Here is a list of questions we have learned to ask when shopping for credit card processing:
1. Who are the gateway and processing companies?
2. What are the setup fees?
3. What is the monthly fee?
4. What is the statement fee and does it increase with low volume?
5. What is the discount rate?
6. What is the fee per transaction?
7. What is the monthly minimum?
8. What are the contract term and the early termination fee?
7. How long does it take the for the funds to appear in my bank account after approval? (Usually 48 hours. However, some processors only deposit funds every 14 days!)
8. Whom do I contact when I have questions or problems?
The PayPal Model
PayPal, ProPay, and 2checkout are third-party processing services. These companies accept online credit card orders on behalf of you or your company. Like processors, they charge small setup fee, a per-transaction fee, and a discount rate per transaction. Unlike processors, you do not have to open a merchant account and you pay no gateway fees, monthly fees, or statement fees. If you are just starting out and you only do credit card sales online, you might check out these services to see if they meet your needs until online sales take off.
We have a relatively low volume of credit card transactions overall. However, because we accept credit cards from direct retail sales and from our wholesale customers as well as online through our shopping cart, we cannot use PayPal. These services are intended for online shopping cart sales only.
1 comment:
setting up a merchant account for your credit card processing can also be considered as an alternative.
before making a decision, one should really analyze their volume of business and decide whether or not the fees of a 3rd party site for processing is necessary over a merchant account with lower fees.
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