If you’re a business owner, then you know that credit card processing fees can quickly add up. Not only do these fees cut into your profits, but they can also be difficult to predict. Wouldn’t it be nice to plan your financial future while being able to keep more of your profits? By following these tips, you can save yourself a lot of money in the long run.
What are Credit Card Processing Fees?
Every time a customer pays with a credit or debit card whether online or in a store, the merchant is charged a processing fee. Why? This fee covers the cost of approving the card transaction, including the cost of sending money to the merchant’s bank, and a small profit for the credit card company.
Depending on which country your business is based, these fees can be a little different. For example, in the US, businesses are typically charged a different rate from those in Australia. Also, the way that the fees are applied varies from one location to another. Some fees you might see as a business include:
- Interchange fees
- Percentage of the total transaction
- Per-transaction fee
In Europe, there are different rules when it comes to credit card processing fees. Businesses there are only charged a very small fee, known as the “interchange fee”. This is because the European Union has capped the amount that businesses can be charged for credit card processing.
In Australia, businesses are more likely to be charged a higher fee, which is generally a percentage of the total transaction. In some cases, businesses might also be charged a per-transaction fee. With this in mind, it’s important to be clear about the terms of the agreement before proceeding.
Saving Money with Credit Card Fees
If you’re looking to minimise the fees you’re charged for credit card processing, there are a few things you can do. First, make sure you understand the fees that apply to your business. Often, businesses sign contracts without fully understanding the fees they’ll be charged.
Second, try to negotiate a lower rate with your credit card processor. Although rates are set by credit card companies, processors have some flexibility when it comes to pricing. Businesses are often pessimistic, but it doesn’t hurt to try to negotiate a better rate – you may be surprised at what you can get.
Third, consider using a flat-rate credit card processor. With flat-rate pricing, you pay one low rate for all credit and debit card transactions, regardless of the card type. This can be a great option for businesses with variable transaction amounts.
Finally, new solutions have developed over the years that don’t charge any hidden fees. With a fee-free EFTPOS machine, businesses can process credit and debit card payments without paying any merchant fees. Among others, the type of solution is perfect for small businesses or startups that are operating on a tight budget.
Why are EFTPOS machines so good aside from the lack of fees? Well, they’re easy to use and don’t require an extensive setup. All you need is an internet connection and a power outlet, and you’re good to go. Contactless payments are also becoming more and more popular, which is perfect if you want to avoid handling cash.
Typically, the best EFTPOS machines have a touchscreen and they’re also linked up to an advanced POS system. This allows you to keep track of your sales, inventory, and customers with ease. If you’re looking for a comprehensive solution that will save you money and make the business more efficient, an EFTPOS machine is the way to go.