How to save money on your card payment transactions?
In today’s fast-paced world, card payments have become the norm for both customers and businesses. But the convenience of card payments often comes with hidden fees and costs that can add up quickly. Whether you’re a small business owner or managing a large enterprise, understanding how to minimise these costs can significantly impact your bottom line. In this blog post, you will learn effective strategies to save money on your card payment transactions.
Audit Your Previous Statements and Card Costs
The first thing you need to do is look at your current credit card processing costs. Audit your last three statements and compare the discount rate, per transaction rate, authorisation fees, minimum monthly fees, and every other charge on the statement. By examining these details, you can identify patterns that may be costing you more than necessary. Look for hidden fees or charges that you don’t fully understand and mark them for further investigation.
Understanding these charges will provide you with a baseline for what you’re currently spending and where potential savings can be made. The fees may seem insignificant, but over multiple months, they can add up to big costs. Having an audit in place allows you to make data-driven decisions about your payment processing.
Evaluate Your Card Transactions Contract
Being under contract does not affect a rate reduction. However, the term remaining in the contract will impact on your ability to reduce existing fees. Review the terms of your contract carefully. Check for clauses related to early termination fees and understand the renewal terms. This will be important when you’re negotiating better rates or deciding to switch providers.
Also, it’s essential to assess whether your current merchant services align with your business needs. Sometimes, contracts include services or features that you may not be using but are paying for. By identifying these, you can negotiate or remove unnecessary features and reduce costs. If your contract is nearing its end, start exploring your options early to give yourself enough time to negotiate better rates or switch to a more cost-effective provider.
Do Some Research
Consult with a credit card processing expert to help you lower fees. If you’re reading this blog post, you’re already doing your homework. You want to be as informed as possible about the different types of processing, pricing structures, your rates, and other rates offered on the market. Familiarise yourself with terms like interchange rates, tiered pricing, and flat-rate pricing. Understanding these will help you make more informed decisions.
Take the time to read reviews and case studies about different payment processors. See what other businesses in your industry are saying about their experiences. This research will give you insights into the strengths and weaknesses of various merchant service providers, and help you identify which one might be the best fit for your business needs. The more informed you are, the better you’ll be at negotiating and choosing a supplier that offers the best combination of price and service.
Negotiate Fees and Push Back
Most businesses don’t realise this, but credit card processing fees are negotiable. The scheme fees imposed by the credit card networks are firm, but everything else is up for discussion. Most companies will tell you from the beginning that they can’t go any lower. But push back on that! They obviously don’t want to lower your rates because it impacts on their profit margins. But they don’t want to lose your business either. Use the research we’ve discussed to strengthen your negotiation.
When negotiating, emphasise your value as a customer. If you have a good payment history and a steady volume of transactions, highlight these points. Processors are often willing to offer better terms to retain valuable clients. It can also be helpful to mention that you are exploring other options. This can provide additional leverage in your negotiations. Remember, persistence is key; sometimes, multiple discussions are necessary to achieve the desired rate reduction.
Monitor Your Monthly Credit Card Fees
Most processors spike their rates from time to time, even mid-contract. You need to be aware of this because lowering your credit card processing fees is only half the battle. You need to ensure that your pricing always stays low and never increases once you negotiate. Regularly audit your monthly statements to catch any unexpected increases in fees. If you notice a spike, contact your processor immediately to address the issue.
Consistency in monitoring can help you catch these changes early and avoid prolonged overcharging. Set a regular schedule, perhaps monthly or quarterly, to review your statements in detail. By staying vigilant, you can maintain the benefits of any negotiated rate and helps you not being taken advantage of. This practice can help you stay informed about your transactions and any emerging patterns that might suggest a need for changes in your processing arrangements.
Reduce the Risk of Credit Card Fraud
High-risk merchants have higher processing costs. Not only are the transaction fees higher, but you’ll also pay a chargeback fee and other fees associated with fraud. Fraud is the number one chargeback reason for both card-present and card-not-present transactions. Implementing robust fraud prevention measures can help reduce these risks. Use secure payment gateways, employ advanced fraud detection tools, and follow best practices for handling customer data.
Investing in fraud prevention can have a significant return on investment by lowering your overall processing costs and protecting your business from financial loss. Ensure that your payment systems are PCI-DSS compliant and regularly update your security protocols. Training your staff on how to recognise and prevent fraudulent activities can also play a crucial role in reducing your risk. The lower your risk profile, the better the rates you can negotiate with your payment processor.
Consult with an Expert
Working with an expert in the credit card processing space is the easiest way to lower your fees. Here at Procure.ie, we negotiate with credit card processors on behalf of our clients every day. We help identify the hidden fees and unnecessary fees that can be removed from statements. Our team also helps reduce transaction costs and markups imposed by the processor. By partnering with us, you can ensure that you’re getting the best possible rates and terms for your business.
Our experts provide insights and recommendations that you might not have considered. They can analyse your specific situation and tailor strategies to your business’s needs. You will never have to worry as our experts stay updated on industry trends and regulatory changes, ensuring that your payment processing remains efficient and compliant. Chat to our team and get immediate pricing now to start saving.
