One of the things that we have noticed at CheapestMerchantAccounts.com is that nearly every small business owner that signed up for their merchant account “online” (ie they never spoke with a sales rep), was paying extraneous costs and fees – sometimes to the tune of hundreds of dollars a year.
Hearing these stories is extremely frustrating, as it also seems as though these individuals, almost universally felt as though they had done a lot of research to prevent themselves from signing a bad deal.
In speaking with these merchants they often had the same list of reasons why they chose to try and conduct the entire process online:
- Timing issues (it was 10 o’clock at night or it was 1 in the afternoon, but they were filling out form while at their 9-5 job, and wouldn’t be able to talk until later)
- Avoid high pressure sales tactics
- Too busy to speak with someone
- Felt they would be better able to accurately compare the deals themselves once they had the rates in an email
These are all valid reason but here is the catch:
I really can not stress enough how important it is to actually speak with a knowledgeable sales rep. I’ve done enough of these and worked with so many various businesses to know that no two merchant account contracts are the same. And most important I’ve learned that if they are the same it probably means something is wrong.
Why?
Because the system was designed that way. There are over 200 different types of credit cards, and each credit card can have a different rate; also each card can have multiple rates itself, based on the type of transaction it is (qualified,mid-qualified,non-qualified). If that wasn’t enough what type of business you have and the perceived “risk” in your transactions can impact each potential rate. How long you’ve been open, your personal credit history, your corporate credit history, all of these factors and more potentially impact what rates you will be paying on your merchant account. And all of this is before you even get into the additional fees and charges that some merchant service providers hide in their contracts.
This is the main reason, I so urgently stress that you avoid simply asking for an email with quotes in it. In fact I would advise you to be very wary of any merchant service provider that is excited about doing this. How can they possible provide the best priced account without knowing your business type, your operating hours, whether you are retail or an online business, a mix of both or the hundreds of other factors that go into setting you up correctly?
I recognize this is a lot to take in, and it can be overwhelming, as noted often the individuals I speak with say that they choose to do it online despite the risks because its a simple way to avoid feeling overwhelmed or rushed by a pushy sales person on the phone. My advice in those situations is to politely excuse yourself from the conversation and say “Thank you for your time but I have decided not to go with your company.”. Remember you are the valued customer in this situation, if you are not being treated the way you would treat one of your customers, move on to another processor.
Also as a small business owner myself, I am all to aware of the time constraints place on running/starting your own business, and often find myself searching for things at 1 am because the day light hours seem to fly by. However, for something as important as a merchant account where signing the right deal makes things painless, and signing the wrong deals causes an amazing amount of headaches not to mention the impact it can have on how much money ends up in your account; my advice to those of you who find yourselves reading this during off hours or when you can’t have a conversation on the phone, is to fill out the website form and write in the comments a time that you would like a call back to go over things.
We have tried to give you the best chance of signing up for a great merchant account with our reviews. But even then you might pull the short straw and call their worst rep on their worst day, sadly it happens. When that happens go to the next one, but make sure you always speak with a sales rep before signing up. If the sales rep doesn’t ask you questions like “What type of business do you have?” or “How are you going to be accepting credit cards?” before they offer potential rates, you are likely working with someone who does not have your best interest at heart.
So to summarize, my final advice is this:
Signing up for a merchant account is an important decision. To do it right you need to work with a great processor, and you need to work with them to set up the best deal for your business. Avoiding customization for the sake of time or convenience carries with it too many costs both in terms of time and money down the road, not to take the time to do it right now. If you are busy at the moment or find yourself searching during off hours, fill out the form and ask for someone to call you back at a better time. If you have the time, give the company a call while you’re at your computer. Be concerned if you are not being asked questions about your business and most important make sure you feel comfortable with the person you are speaking with. If something feels wrong, move on and try another processor until you find the one that you feel great about. I hope that our reviews here at CheapestMerchantAccounts.com help guide you in the right direction as well as give you some warnings about potential issues with certain processors.
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Good luck out there.
Robert Evans
Co-Founder, CheapestMerchantAccounts.com
Advice from Fellow Small Business Owners
I opened a company in July (in Quebec) and realized quickly that receiving checks by mail wasn’t the best way to go. Being a consulting company I have customers on the phone already so it would be very easy to request payment by credit card and process those payments through a virtual merchant while on the phone with the customer. Originally I was in contact with Federated Payments(MSI Canada), but after agreeing to the application and submitting all the final paperwork, no one answered. Finally after a week with no response and not being able to get on the phone or any response (even email) from my sales rep, I began to worry. I was afraid to move onto another merchant having already signed the agreement with Federated Payments.
Finally after two weeks of no communication I received a call from them but from a different sales rep. He told me the sale rep I had been in contact with had a death in the family and that I must resubmit the application and said my old one was void. He emailed me a new one, however the rates were nearly doubled. Seeing that I told him I was going with another company.
I spoke with Moneris but was shut down when I told them I had a co-signer who was not a part of my company. Finally I have been dealing with Collective POS who will be applying on my behalf to Elavon. They say my co-signer will be accepted even though he is not a part of my company. I made sure to fill out the application to reflect that, I don’t want to have my merchant shut down after two weeks for misinformation.
Just like your article, I don’t have a lot of free time. I’d like to submit my signed application this monday but I’d appreciate your advice, if you have any comments Collective POS. If you have the time, I’d really like to give you a copy of my application to Collective POS so you can tell me if I am being ripped of or not.
Thank you.