How Can You Tell If a Merchant Account Company is Good?

I have business owners asking me this question all the time, how can you tell if the merchant account vendor you are getting a quote from is a good company or not...?

Just like most business decisions you should always firstly listen to your gut. If you feel uneasy or pushed by a sales rep for any reason or you feel that the potential provider is not being 100% up front with you then find someone else.


Here is a list of some check marks you'll want to make sure are being hit:

1. A good company will ask you questions about your business and make sure they setting you up with the right payment processing solution. A bad one will be pushing for the sale and not asking questions.
2. Cheap prices are usually synonymous with cheap quality and/or poor services. The old expression of "you pay for what you get" really is true. I would do a little research to find out what the current buy rates are from Visa and Master Card online. Just type in visa interchange or master card interchange to find out what the credit card processor is buying the rates at. If the rates they are quoting you are way below that rate then you know something must be wrong. They must be back ending you with tons of hidden fees to make up the difference because no merchant account company is looking to become an investor in your business.
3. A good company does not hide their fees nor makes excuses for them. They will be more focused on services and providing customer support. Look for social proof, testimonials, referrals, ask other business owners who they use, jump on business forums and ask people who have similar business as yours in the general area or region you are in who they are using and are they happy.
4. A good company will openly give you their tech/customer support phone number for you to call at anytime you want to test out their services.

If you tick off those four questions before choosing a merchant account provider you should be in good hands.

Do You Run a Co-op Type Business and Need Merchant Account Services?

It is common for some business types to be set-up like a co-op where a group of services providers like hair stylists or massage therapists etc. will come together in one location and split costs on the store space or clinic office space.

The problem occurs when it comes to getting merchant account services for these types of businesses because typically most merchant account providers in Canada will not allow several different business accounts on the same terminal.

Some of these co-op type businesses can have as many as 6 - 10 people in all sharing one location. Nobody wants to see a barrage of 6 different Point of Sale Terminals all lined up at the check out desk, nor do the technicians want have the expenses of each having their own payment processing solution.

What can these Co-op type of businesses do?

Well, many Point of Sale terminals now have the capability to be set-up with clerk I.D.'s, which can track each person's sales, tips, cash back, etc. Although there can still only be one business account associated with the merchant account this essentially would simplify the accounting.

One brave soul at the Co-op could sign-up for the merchant account and then they could write checks to the other technicians on a weekly or bi-weekly basis minus the costs associated with the merchant account services. This way the costs are kept down for everyone at the Co-op, there is only one Point of Sale Terminal, and the Co-op doesn't have to worry about losing any sales by not offering debit and/or credit cards as a method of payment.

What Will Cause Your 3rd Party Merchant Account To Be Suspended

Some of the fastest factors that will cause your third party payment processing account to be suspended is to do any of the following below:

• Persistent pattern of charge backs - most merchant accounts do not like to see more then a 1% charge back ratio regardless of whether they are 'third party' merchant accounts or 'true' merchant accounts
  
• Poor or inadequate response to customers and a history of unresolved complaints or refused refunds
• Supplying faulty or inferior goods that are not as described in your product description
• Entering customer credit cards yourself which goes against your merchant agreement - do not and say do not take orders over the phone then enter it into your PayPal buy button for people to process their orders - they must do it themselves. If you are want to take orders over the phone you will need to be set-up with a merchant account that handles MO/TO ordering.

It is important that you take the time required to read the terms and conditions to your merchant accounts and know you rights and what the correct procedures are to processing your credit card payments then to be naive and find out the hard way of having your accounts suspended.

If you do run into major issues with charge backs and suspensions I recommend you visit: www.merchant911.org

Do You Run A Restaurant, Bar, or Night Club And Do Not Offer Debit As Option To Pay?

Do you run a Restaurant, Bar, or Night Club and do not offer Debit as option to pay?

Well you may want to re-think you decision to do that.

Having a short range Point of Sale Terminal with a one step tipping feature can really benefit the bottom line in your business.

I believe the stats are that over 60% of all Canadians pay by their debit cards. The first point is you should allow your customers to pay by the method they most prefer.

Besides listening to the stats, there are other reasons having a 'at the table' or 'mobile' Point of Sale Terminal that offers debit is:

• Turn Tables Faster
• No pre-authorizations at the end of the night
• Lower transactions costs for debit vs credit (just taking 10-20% off your credit card costs can save you 1000's of dollars every year.)
• Smart Chip credit cards require at the table terminals
• Happier customers, because they keep their cards in their hand
• Can offer cash back (certified cash back = proper cash back records for accounting/tax preparation

Chew on a few of those benefits!

I know many restaurants, bars, and night clubs have only offered cash or credit cards as a method of payment for many many many years, but owners of these establishments might want to rethink that decision.

How to Get a Merchant Account in Canada

Example Scenario: Your website is finally gaining traffic and your online business is looking like is going to produce profits:

1) You have captured your website visitor’s attention with good SEO, good content, and good sales copy.

2) You have generated an interest for your product and prospects desire your product/services.

3) Now you want to close the sale -- Immediately!!

The Problem: Without accepting credit cards you can't close the sale immediately! By not making as easy as possible for potential clients/customers to pay you, you know, you are certainly losing all your potential impulse purchases, and even some otherwise dedicated customers who simply become too frustrated to complete the purchase process.

So you finally decide to set-up a merchant account! You have decided to phone your local bank in Canada to setup a merchant account to sell your $20.00 widget on the Internet. Hopefully you can be all setup by the end of the evening and widget orders will be filling your email box from around the world by morning.

Getting a Merchant Account at Your Local Bank:

You phone your bank on Thursday, setup an appointment to come in next Monday at 10am to speak to a Bank Manager.

Monday Morning Day 1 The Bank Manager then tells you need to contact their Sister Merchant Account Company’s Account Executive to set-up payment processing on your website. So now you phone with the sister organization after wasting a time to go in to see the Bank Manager to find out that they cannot help you. After speaking with the merchant account service provider, they tell you to fax in all your business registration papers, identification and samples of your product you will be selling online. Excitedly, you head home to gather all this information.

Day 2 You finally tracked down all the necessary paperwork they said they would require to apply for an account and fax it in by noon’ish and now you expecting to hear back within the next 24 hours of your approved. You day dream that any minute now people will be ordering from your site like a dog on a bone!

Day 5 Worried, that you haven’t heard anything back yet, so you call your accountant executive that has been assigned to you and ask them what is your status, to only find out that you still have a bunch of forms to authorize. You then have these forms faxed over to you and the paperwork is 15 pages of lawyer jargon that does not make any sense to you.

Day 6 You call your account executive and ask him to explain the paperwork and what the fees are and he lists off the fees and rates and says none of it matters because this is only an application, and that they don’t even know if you will be approved.

Day 7 You begin to panic after watching more and more lost sales on your website occur you decide to sign-off on this 15 page application and fax it in.

Day 10 Still no merchant account.

Day 14 Monday comes along and now it is running into week 3 of trying to get set-up with a merchant account so you can simply accept credit cards on your website. So you decide to phone your account executive to inquire about the status of your approval. You find out that you have been approved, but with conditions. They either want a $7000 deposit or they want to hold 25% of your sales until it equals $7000 as a reserve account in case of any charge back scenarios.

Day 16 You reluctantly authorize the reserve by signing more lawyer jargon paperwork. You ask how long will this take? The account executive replies, “It should be approved in about five days.”

Day 21 You receive a call from your account executive and you are told that your account is conditionally approved, and you will receive your merchant accounts once you make sure that your ‘private policy, terms of use, and refund policy’ is clearly stated on every page.

Day 23 You contact them letting them know you have made the appropriate changes they requested.

Day 25 They get back to you, to say yes you did do what they requested and they will issue your merchant account numbers shortly so you can integrate them into your shopping cart software program.

Day 30 Finally, after almost a month from initializing your first appointment with the Bank, you now have a merchant account for your website and can now start accepting payments by credit cards.

Does this scene sound too familiar when trying to get a Canadian Merchant account?

Getting a Canadian merchant account is harder than one anticipates. Not to mention …expensive!

There are alternatives to the Bank and/or their sister organizations:

PayPal
This is the easiest way to get a merchant account online and most likely the cheapest if you just have a small product line. They will even let you sell in Canadian funds and deposit right into your Canadian bank account. They’ve been around for years and you know if E-bay uses them, they must be trustworthy and reliable.

Use a Merchant Account Specialist:

Merchant Account Specialist
A Merchant Account Specialist can save you time and help you make this administrative nightmare seem pleasant. They typically do your application for. Shop around from the competition in advance and can usually have most clients set-up and ready to go in about 2 weeks.

If you choose to do it yourself – Use your favourite search engine and type “Canadian merchant accounts” in it, you will find tons of links to research.

Whoever you decide to open a Merchant Account with:
Make Sure There Are No Hidden Charges! A good reference to have by your side is this article titled ‘The 17 Essential Questions Every Canadian Business Owner Must Ask before Choosing a Payment Processing Provider’

The best way to avoid any hidden or unexpected fees is to do your research…

What is the big benefit of using a IP Point-of-Sale Terminal over a Dial-up Point-of-Sale Terminal?

There are many benefits to use a IP Point-of-Sale Terminal over the old Dial-up Point-of-Sale Terminals.

However, before we get into the benefits let's just make sure we clear on the the basic terminology. IP means connecting through your High-speed internet connection, sometimes referred to as DSL, Broadband, and IP. From this point forward we will refer Point-of-Sale to "POS".

The three major benefits are:

1. Does not tie up your existing phone line(s)

2. Can add many terminals to one IP connection

3. High Speed Internet POS Terminals can process transactions in 4-5 seconds

If you currently have both high speed internet at you place of work and your current POS is connected to you phone line causing it to be not usable while you do debit and credit card transactions then you will find it huge convenience to upgrade your old Dial-up POS terminal into an IP POS Terminal because you will not have to worry about tying of your phone line anymore.

With an IP connection you can be on your computer surfing the net and still processing your sales through your POS machine, in fact, you could also have serveral POS terminals all running off one IP connection.

Therefore, if you are one of those merchants who has multi-check out stations with each their own POS Terminal and with each POS Terminal on it's own dedicated phone line then this will save you a ton in phone line expenses, for with IP connection you can run as many devices off one IP connection. Less cost then than paying for a second phone line.

You will also notice that IP POS Terminals can process transactions in about 3 seconds, which can really decrease lines ups at your checkout or if you run a business like a restaurant/bar you would be able to turn tables faster, etc. This usually makes both customers and staff happier.

This usually means more money for everyone too!