Cheapest Credit Card Processing Companies for Small Businesses    
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October 2, 2022

Cheapest Credit Card Processing Companies for Small Businesses

  • December 15, 2021
  • 4 min read
Cheapest Credit Card Processing Companies for Small Businesses

There are literally hundreds of credit card processing companies, and a Google search will produce a mountain of information. If you’re not sure where to begin your research, start by checking out the directory at Merchant Maverick . You can search for service providers in your geographic region or review their listing of the lowest cost small business credit card processors.

Also, if you’re just getting started you may want to find a merchant services company that offers free equipment. This will typically cost more per month but the same amount of service may be obtained without committing to a long-term contract or paying an equipment purchase fee. Once your business is established and processing enough credit card transactions, it may make sense to switch your account to a company that offers better rates for higher ticket transactions.

One point we want to make clear: as a small business owner, you should NEVER sign up for merchant services with one of those companies that promises “instant approval” or “zero chargeback” guarantees. This is not what they advertise and odds are the salesperson will be able to convince you to switch your merchant account from another company to theirs with promises of “instant approval” or “no chargeback fees.” However, banks do not allow their credit card processing companies to approve new merchants within minutes. Banks are very strict about merchant account approvals. If you are approved by the bank it is because they believe your business has merit and will be profitable. Even if a salesperson promises you instant merchant account approval, this should be a red flag that the company or salesperson is simply lying to you.

If your business is just starting out and has no history of credit card transactions, you will likely need to establish a separate charge account with each bank. There are several ways to do this but only one way is required; you must have at least one small business charge card. The law requires that all companies with a credit card merchant account must accept cards in their name (not third party) and use them for purchases whenever possible (even though the customer’s funds may be held until approved by the bank). You want to make sure your company gets paid quickly, so either require your customers to give their card number when an order is placed or use a small business charge card.

The other way to do this is through what’s called a “virtual terminal.” This allows you to manually type in card numbers and process the transactions just as if they were swiped with a credit card machine. However, we don’t recommend this method because you cannot automatically download your transactions into your merchant provider’s software. Plus, there is a small fee for each transaction.

One important thing to consider when choosing a credit card processing company is the Durbin Amendment. This was put in place by the Federal Reserve Board to lower fees that merchants pay on debit/credit card transactions under new regulations. What this means for your business is that you will want to ensure the company you choose provides “interchange plus” pricing or at least has a flat per-transaction fee.

Also, it’s best if the company offers real-time reporting and online management of your account. Additional benefits include: longer guarantee periods (up to six months), discounts for qualified high-volume clients, and the ability to process gift cards.

Why Merchant Accounts are Crucial for Businesses of all Sizes?

I’m sure you have seen or heard advertisements on TV or the radio about how easy it is to open your own business these days. The fact is, with just an internet connection, a few hundred dollars, and some business cards you can have your own “multi-million dollar empire” up and running in no time. The problem is that most people fail to consider the financial aspect of running a business. All businesses require an upfront investment whether it’s for inventory, leasing office space, hiring employees or buying equipment/supplies. What most people don’t realize is that the single biggest investment a business owner will make is in his or her merchant account. Nowadays it’s almost impossible to run an online business without accepting credit cards as form of payment.