For a small business, a payment processing partner can give you more ways to do business. But payment processing can still leave businesses to deal with risks and a headache here and there.
Key Takaways You Will Get From This Article
1. To avoid lack of transparency, when signing up for a payment processing plan, ensure you receive an itemized or detailed plan list.
2. To best prevent credit card fraud, ensure your business is PCI Compliant.
3. Making explicit return policies can help your case when an issuing bank or payment processor contacts you about a potential chargeback situation.
4. You need payment processing that has an integrated payment solution.
5. Find a payment processor that has 24/7 customer support.
6. Give more power to your customers by offering as many payment methods as possible.
If you aren't prepared for the problems that can arise, you can lose money and the trust of your customers.
That's why Electronic merchant Systems wants to help you by providing effective solutions for the six most common problems with payment processing. We hope this article will prepare you for anything thrown your way when running your business with a payment processor.
Let's get started!
7. What's Next?
Lack of Transparency
There is no simple answer when asked how much payment processing costs. Difference pricing models and fees determine how much you'll pay for payment processing.
But, it might be a problem for your bottom line if you aren't aware of what you're paying for.
Solution: When signing up for a payment processing plan, ensure you receive an itemized or detailed plan list—no one like to find hidden fees in their invoice after signing on.
It will also benefit you to ask if there are any minimum or maximum limits. For example, some companies require a $25,000/month minimum for processing. That means you could be penalized if your business brings in less than $25,000 in payment processing for any given month.
Making purchases online or in person with a card allows for great convenience for consumers. However, your customer's information could be in jeopardy and fall into the hands of bad actors such as hackers.
In fact, small businesses account for the highest likelihood of being victims of credit card fraud as opposed to larger corporations. Fraud can cost your company money and, potentially worse, your customer's trust.
Solution: To best prevent credit card fraud, ensure your business is PCI Compliant. The Payment Card Industry Data Security Standard (PCI DSS) is followed by payment processors and businesses that accept credit card payments.
It’s the most common way to protect your customers’ data. Some payment processors, like Electronic Merchant Systems, require their merchants to be PCI Compliant.
A chargeback refers to an amount of money paid back to the cardholder from the merchant. Chargebacks can result from fraud, but that’s not the only time you can see them.
You may find yourself in a case of charging back funds if any sale is disrupted by the cardholder or issuing bank.
Keep in mind that chargebacks are not the same as refunds. Refunds are honored by the merchant when a customer is happy with their service or wishes to return an item.
Solution: As we mentioned, PCI standards can prevent fraudulent chargebacks, but you might also want to revise your return policies. Making explicit return policies can help your case when an issuing bank or payment processor contacts you about a potential chargeback situation.
Lack of Integration
Bookkeeping for your business is essential, but that doesn’t make it fun. Manually entering your transaction data and employee management is tedious and leaves room for error that can cost your business money.
Solution: You need payment processing that has an integrated payment solution. The right integrations should leave you with management software all in one place for an optimized workflow.
You’ll spend more time operating and refining your business than having your nose in spreadsheets.
Lack of Support
Here’s a scenario; you’re running your 24-hour coffee shop, and you happen to be on the graveyard shift.
Suddenly, at 1 am, your point of sale terminal won’t connect to the internet. You check your network, and every other device is working, so it must be the terminal that’s not working.
Bad news: Your payment processing partner's support line isn’t open until 8 am. You can take cash, but considering most people pay with cards or mobile wallets nowadays, you may have to turn away business until the morning.
Solution: Find a payment processor that has 24/7 customer support. Your business may not be 24/7 like the coffee shop above, but issues can arise anytime.
Having around-the-clock customer support gives you and your employees peace of mind.
Few Payment Methods
There are more ways to do business now than ever before. Trends in the payment industry leave customers with more options than just cards or cash. So, it’s an issue when you can only accept cash and cards.
You might be paying your processor to accept just cards while other processors charge the same amount for cards and other payment methods.
Solution: Give more power to your customers by offering as many ways to pay as possible. The term “cardholder” can now apply to customers using mobile wallets, QR codes, SMS payments, and many others.
Hopefully, you haven’t run into these problems in the past, and now you can better prepare yourself having read this article.
If you want to safeguard your business from any of the above issues, you may want to consider Electronic Merchant Systems as your payment processor.
Since 1988, we’ve provided innovative payment processing solutions and merchant services to small businesses nationwide.
We’ll be there whenever you have an issue, as our customer support team is on call 24/7/365 to help you get out of the bind you find yourself in.