If you own a small business then you are familiar with the fees the fees you have to pay on debit and credit card transactions. The 2-4 percent on every transaction can really add up, especially if you are trying to keep prices low to compete. There are more advanced merchant service accounts that can actually save you money and add convenience.
Your iPhone or Android
There's an App for that. In fact there are several. A few companies are now offering an advanced merchant service account that can process credit cards over your iPhone or other smart phone. Some even have a card reader you can attach to your phone. The best part is most apps don't charge you a processing fee because it uses your data connection to process the transaction.
While it sounds cool and may be a solution for some, you have to ask yourself how comfortable customers will be with you running around sliding their credit cards through your phone.
Merchant Advance
If you were looking to take out a small business loan or need some extra cash, then getting a merchant advance can accomplish this and help lower your processing fees.
This advanced merchant account processing option will buy your future credit card sales at a discount and advance you the money for them. Because they also provide account service they can give you steep discount on precessing fees. If the terms are good you could save some real money at the register and get the capital you needed anyway.
If you choose to go this route, make sure the company is reliable and you read the terms carefully.
Last of all, it may turn out Uncle Sam will take care of this. As of the time this article was written Congress was debating a credit and debit processing amendment to the Finance Reform Bill. While it would cap processing fees, it may have some unintended effects that could raise overall costs. It's worth keeping an eye on, however.
Jonathan Fletcher is a small business financial advisor for Performance Commercial Capital in Irvine, California. Performance Commercial Capital provides low cost capital solutions for small business owners across the country. Visit Performance Commercial Capital for more articles and tips on running your small business and to find out about qualifying for a small business finance program.
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