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Money Saving Tips for Credit Card Processing Fees

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Money Saving Tips for Credit Card Processing Fees

 

Entrepreneurs and small business owners juggle dozens of tasks and issues daily to keep their businesses afloat and profitable. So, it is no surprise that researching ways to save money on credit card processing fees falls to the bottom – or off – the To Do list.

 

Processing fees are similar to a slow water leak: it’s a slow drip you know about but ignore as you rush through each day.  But over a year’s transactions, that little leak deals a significant blow to your bottom line. Transaction processing fees are the most familiar charges along with assessment fees, authorization costs, chargeback fees and others that sneak into your statements if you aren’t paying attention, creating a complicated, expensive mess. 

 

If you are dedicated to serving your customers, accepting credit cards is a necessary evil for your business. However, you can take a bite out of those charges by adopting these tips.

  1. Leverage your processing volume.

The more you sell, the more processing you generate, adding value to your merchant profile with your payment processor. Make sure that you are getting appropriate credit (in the form of reduced rates) for the volume you are processing with your payment vendor. Credit card payment vendors are a middle link of the processing chain; they can negotiate with their providers for lower rates based on your current volume. As your business increases and you ask for better rates, the payment vendor has a better negotiating position to lower their overhead and pass the savings along to you.

 

“When a business owner proves to me that their transaction volume is strong and rising,” Mike Krause of Sales Sense Payments observed, “I can use that to negotiate better rates for my merchants, ensuring their loyalty and saving them money in the process.”

 

  1. Take a bite out of fraud.

If a payment vendor believes your business is a higher than normal security risk, your processing fees will reflect that fact. With chipped credit cards becoming pervasive in the United States, in-person card transactions should be the most secure. Next in the security hierarchy, is swiping credit cards and entering basic security information such as the billing Zip code and CVV (card verification value or security code) from the back of the card.  If a credit card’s 16 digits and security code must be manually keyed, the rate per transaction rises because the payment provider’s risk profile increases, even for inadvertent mis-keying the numbers. 

This step alone can protect 1 percent of the transaction value for your business. Again, not a big number by itself but each lost percentage point adds up. 

  1. Check the address.

Another step you can take to reduce your exposure to credit card fraud is by using Address Verification Service (AVS). Address Verification Service confirms the customer-keyed address matches the address on file at the credit card company. This valuable service is essential for preventing fraud for online (card not present) purchases, including limiting merchant chargebacks.

 

When an entered address matches what’s on file, the card-issuing bank transmits a unique AVS code to the merchant, which is then used to authorize or deny the transaction.

Globally, Visa and MasterCard fully support AVS; in the U.S., Visa encourages AVS use by offering merchants lower interchange rates on transactions confirmed with AVS, another money-saving opportunity.

  1. Start well, process well.

When you initially set up your merchant services account, ask enough questions to ensure you are enrolled accurately. Your business categorization, types of transactions you accept and the frequency of transactions all figure into your specific fee structure. Be sure you understand the implication of your answers and inspect how your account is set up. While credit card processing can be complicated, you owe it to your business profitability to completely understand the charges and process thoroughly.

Further, your business process and policies will affect the processing fees you pay. Process your transactions for a given business day within 24 hours. Batching your transactions each day is more cost effective than holding transactions for a couple days or even once a week. The less frequently you process your transactions, the higher the rates and fees you are charged. Get in the habit of daily transaction batching.

  1. Ask, ask, ask.

You started your business because of your talents in a particular area, not because you knew everything there was to know about credit card processing. You are not alone! However, you can research the topic and work with your payment provider to get sufficient knowledge to ensure your business is in control of its expenses. Your payment provider is a middle link in the transaction processing chain and their knowledge and relationship with their suppliers is an asset you should lean on.

 

This sort of insider information, and having an expert payment provider working with you, can help you process credit card transactions efficiently and economically. Switching among processors to squeeze a little savings isn’t worthwhile. However, make your payment processor representative an ally in your business to reap better rates and a more satisfying experience.

 

For more information on merchant credit card processing services, contact Mike Krause at 585-704-6453 or visit SalesSensePayments.com.

To Chip or Not to Chip

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Retailers in the United States mostly converted to chipped credit cards in October 2015 and slowly over the past 3 years we have all become accustomed to dipping credit cards at retail checkouts. So, why are we sometimes sliding cards the old-fashioned way rather than dipping (plugging the cards into the terminal) at some retailers?

There are a couple issues behind whether a retailer has a chip-equipped terminal but still has you slide your card for payment. In addition to installing a new chip-ready terminal for checkout, the merchants must also install new software and then certify with their transaction processor that transactions are coming through accurately. Certification of their new process takes time and scheduling.

Another reason for merchants’ reluctance to adopt EMV is the additional time it takes to process a credit card transaction. While sliding a credit card takes only a few seconds, dipping the card into the card reader slot takes up to a minute longer because the transaction is verified in real-time. During non-rush months, an extra minute might be inconvenient but not noteworthy. However, during peak retail periods such as the winter holidays, every minute counts and retailers want those minutes spent shopping, not at the register.

Smaller localized merchants are somewhat more willing to take the gamble that the credit cards they’re accepting are not risky and will not affect their ability to receive funds from the transaction. In addition, smaller merchants don’t see the clear benefits of EMV chips because it doesn’t add to increased sales and it doesn’t make it easier for them to process credit cards. They know there’s a risk of credit card fraud but it doesn’t outweigh the pain and process of converting to EMV completely, certification included.

Another issue is that the United States has primarily adopted “chip and signature” technology, rather than “chip and PIN,” not providing the same level of security expected of the overall chip implementation. Moving to chip and PIN authorization is still pending in the US.

The whole movement to chip-enabled cards originated with major financial institutions (Europay, MasterCard, and Visa – EMV), pushing the responsibility for credit card fraud back on merchants, rather than absorbing the costs of fraud themselves. This has been the impetus of law suits still pending.

The US has lagged significantly behind other countries in converting to EMV. Among the largest global markets, the US was the last to make EMV law. It took more than a decade for other countries to fully adopt EMV. While it seems slow in the United States for the adoption of EMV, it is far ahead of the UK adoption, which took about 8 years for 90 percent conversion. The EMV Academy expects the US should be at 90 percent adoption by some time in 2019. Good news for those of us wanting better security for card-present credit card transactions. 

For more information about credit card services and merchant payment processing, contact Mike Krause at Sales Sense Payments by visiting salessensepayments.com or calling 585-704-6453.

Could I Get Your Autograph?

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The occasions where you are asked to sign your name for anything are quickly disappearing. You used to sign at stores for your purchases but as of May, 2018, it’s not required any longer, it’s up to the merchant. Almost no one uses checks at stores these days to pay for items and most bill paying is done online. Again, no need to sign your name.

In fact, it turns out that few merchants over the past decade have taken signatures on seriously. People scribble something, squiggle a line with their finger or a doodle and it’s accepted whether it is a bona fide signature or not. Most sales clerks don’t even check to see if it’s legit or ask for other dentification to compare your name or your signature.

American Express, Visa, Discover Mastercard, and retailers like Walmart and Target have already abandoned getting signatures as a way of authenticating transactions in some countries and for some circumstances. So, your signature is soon to be valuable only on reams of paper when buying a house or other big money purchase.

However, some merchants, namely restaurants, want to keep the signature requirement alive. If the customer doesn’t have to sign the bill for drinks or a meal, where is the new opportunity to leave the server a nice tip? Other business owners mention that signatures can be handy when fighting fraud claims. One owner had a signature on a receipt where a customer was challenging a hefty bill. She ultimately got her payment.

Smaller retailers want to retain the requirement for signatures and it’s their right to do so. However, getting a signature takes a few extra seconds, even if it’s a scribbled smiley face, and those seconds count during busy periods.

It seems that it makes credit card transactions just a tad less personal. Before, you had to at least put something on paper. Now you hand someone your card and get a receipt back. If you’re rushing or engrossed in conversation, you may not even look up from your phone. How is a motivated server or sales clerk to compete with that? A touchpoint between customer and server/retailer is vanishing, making our interactions with others more impersonal every day. And don’t get me started with self-serve checkout lanes where you are both customer and clerk to save the retailer money.

To fight this faceless trend, be present and aware when you are finishing a transaction. Pay attention to how much you’re being charged and to the person on the other side of the counter or table. Put your phone down, pause your conversation and smile. It will do both of you good.

 

 

Filed Under: emv

Seven Ways to Protect Your Credit Card From Being Hacked!

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The number of Americans having their credit cards stolen, compromised or hacked each year is staggeringly in the millions. While the new EMV (stands for Europay, MasterCard Visa, the major credit card companies behind the more secure cards) chips protect your cards in live, in-person transactions at a retail store or restaurant, the new cards are no match online or over the telephone.

 Here are seven ways you can add protection to your credit and debit cards.

  1. Get a secure wallet or purse

The new chipped cards are come with RFID (radio frequency identification) and NFC (near field communication) technology for contactless payments (Apple Pay, Google Pay, bank mobile applications and others). Unfortunately, this leaves them prey to contactless pick pocketing. A thief uses a portable RFID card reader to transfer money from your credit card as a “payment” to a nearby accomplice.

Sure, you can keep your credit cards in an Altoids mints tin or wrap your cards in tin foil. A more conventional option is to buy a wallet, credit card sleeve/holder or purse that blocks automatic RFID transmissions. These are not expensive and give you some peace of mind when you’re on the town or out of the country.

  1. Set Payment Limits on Contactless Cards

If you use contactless cards frequently, contact the credit card company and limit the size of any purchase made with the cards. You can always call them back and raise the limit for a specific purchase. Alternatively, you could disable the contactless payment feature, although that defeats the whole idea somewhat.

  1. Set Up Purchase Notifications

If your financial institution or credit card company offers notifications for purchase transactions, get alerts sent to your cell phone or email. You’re notified immediately of a transaction. If it’s legit, no action required. If it’s fraud, contact the lender and inform them of the unauthorized transaction. They put a hold your card and credit the fraudulent transaction. You can also set up other monthly notifications to help you monitor your credit. 

  1. Use Mobile (Contactless) Payments

Payment services such as Apple Pay, Android Pay, Google Pay and others use your cell phone’s camera to scan, read and store the data on your credit cards. To use these services, hold your phone close to the payment entry device and complete the purchase. Mobile payments can keep your wallet slimmer by leaving the actual cards at home. Just make sure you have a strong password on your cell phone so you’re not vulnerable in that way.

  1. Strong, Secure Passwords

Speaking of passwords, make them strong and secure. Use combinations of upper and lower case alphanumeric and special characters (check – some apps and sites don’t allow special characters) to make them too hard to hassle with. Many online sites (Amazon is one) let you use a two-factor authentication (2FA) so you receive a separate access code on your cell phone or email account to complete a transaction.

  1. Stick with Secure, Reputable Online Retailers

When you’re making an online purchase, even from a company as large as Amazon, make it a habit to glance at the address bar. There should be a lock icon and the first letters should always be https://. This means that the site is locked, encrypted and your transaction is secure. If you don’t see https, do not enter your credit or debit card information. It could be a fake site set up to look like the real site and take your money without a single glance back.

  1. Keep Your Card Within Sight

More restaurants are equipping their servers with portable payment devices so your card doesn’t have to leave the table to be run. You can always accompany your server to the machine if their system is not portable. Always be on the lookout for skimming devices on do-it-yourself payment systems such as self-serve gas stations. Gas station pumps are particularly vulnerable to skimming devices. If the payment entry device looks odd to you, move to another pump or pay inside.​​

For more information about keeping your credit and debit cards safe, contact Mike Krause at Sales Sense Payments, 585-704-6453, mike@salessensepayments.com.

 

7 Rochester Networking Events for March 2017

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There’s a bunch of great Rochester networking events happening in March that you should consider joining. Take a look below at my list of the 6 Best Rochester networking events for March. I have also included a couple of my own events, like the ROC City Hot Sauce Festival. I hope you see you there, or bump into you at a networking event in the area!

1.ROC City Hot Sauce Festival

Hot sauce lovers can’t miss this event! It’s also a great chance to mingle with other business owners in the local restaurant industry. Your ticket includes access to the build-a-plate station with burgers, Zweigle’s Hots and all the traditional fixins, samples of all restaurants’ hot sauces at their individual booths, a chance to vote for your favorite hot sauce in the People’s Choice Award, and 1 drink ticket redeemable for beer, wine or soda.

  • Date/Time: 3/2/17; 6-9PM

  • Location: Burgundy Basin, 1361 Marsh Road, Pittsford, NY

  • Fee: $20 pre-sale (tickets must be purchased by EOD 2/28) or $25 at the door

  • Event Link: ROC City Hot Sauce Festival – Eventbrite

 

2. West TipClub Business Networking Event

From the event organizers: “Join us on Wednesday morning, March 8, for our powerful business networking event that comes with a unique twist. We use a structured format that allows for spotlight introductions followed by our famous “lightning round” so connections are made instantly! For first time guests, there is no cost to attend. Register early before the event closes out, and feel free to forward this invitation to an associate!”

 

3. FEI Rochester St. Patrick’s Day Networking Event

The Financial Executives International Rochester Chapter is hosting a special social networking event integrated with a presentation on insurance industry updates and learning opportunities.

 

4. Eastside Business Expo 2017

From the event organizers: “Join us for an evening of business awareness and networking with businesses from across the eastern suburbs.This event is open to the public and attendance for networking and exploring is free. Registration for attendance is highly encouraged to ensure we have enough refreshments available and to give our exhibitors an idea of how many people to expect.”

 

5. FemCity Rochester March Social

A business networking event for women:  “Come prepared to learn the impact that strengths awareness can have on you personally and on your performance at work, home and in your community — and how to identify the areas where you have the greatest potential for building strength.”

 

6. March vBeer Meetup for VMware Users & Professionals

From the organizers: “ March vBeer will be held at The Lost Borough in Rochester NY. The Lost Borough Brewing Company is the realization of a dream for two life long friends – Dave Finger and Dan Western – in search of the perfect pint of locally brewed craft beer. After years of experimentation with all styles of artisan beers, they have decided to leave their mark by opening a local brewery where they can share their passion with others while providing a truly different craft beer experience.”

 

7. Monthly Young Professionals Happy Hour at Blossom Road Pub (Hosted by AMA Rochester)

About the event: Enjoy some great food specials and meet fellow marketers to put answers into action and solve the biggest problems in the marketing industry. We discuss a new topic every month. This a recurring monthly event on the 4th Tuesday. $1 Off Appetizers – $1 Off Wine – $1 Off Drafts

 

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Have an event you would like to see featured for next month?

Please send the following information to Mike Krause at mike@salessensepayments.com for consideration:

  • Event Name:
  • Brief paragraph about the event:
  • Event Time/Date:
  • Event Address:
  • Event Fees: We prefer to feature free or low-cost events that are open to the general public
  • Event Info/Registration Link:

About Sales Sense Payments

Sales Sense Payments can help save your business thousands of dollars a year in merchant processing fees. We also offer complete point-of-sale (POS) solutions and EMV-compliant credit card machines in addition to platforms for customer loyalty programs. If you process credit card transactions for customers, we can save you money.  Sales Sense Payments is a Rochester-based business, deeply supportive of the success of our local businesses.  Let’s talk!