4 tips for keeping credit card processing fees low

4 tips for keeping credit card processing fees low

Keeping credit card processing fees low is essential to high profitability in a business, especially in today's economy.

There are a few things that you can do to reduce your credit card processing fees and maximize the amount of money that your customers spend.

• Shop around. Shopping around for the lowest credit card processing fees is probably one of the easiest ways to ensure that you keep your expenses down. Review at least three vendors before making a final selection on their merchant accounts. While shopping around, see if you can get vendors to compete for your business.
• Suggest purchase minimums. It's actually against Visa and MasterCard policies to set purchase minimums for transactions. You can, however, suggest purchase minimums to your customers. Some customers will comply with your request, which will cut back on the overall fees you must pay.
• Provide cash discounts. Reward customers who pay in cash and you may see your merchant account fees dip. Sometimes consumers use credit cards because of various cash-back offers and other incentives. Lure the customers to save money now by paying in cash.
• Raise prices. Instead of providing discounts for cash transactions, you can raise your prices across the board to maximize your profits. However, if you aren't careful, this can backfire on you. If you have tried all other methods of reducing your merchant account fees and still need to do something to increase your bottom line, this could be your only choice. However, make sure that you don't price yourself out of the market.

Keeping merchant account fees as low as possible is a delicate balancing act that every business owner must face. Monitoring fees and finding incentives to get customers to stop using their cards for small purchases before raising prices is the best route to lowering credit card fees.

Updated: May 27,2023