5 mistakes made with merchant accounts

5 mistakes made with merchant accounts

Having a merchant account is vital for business, but sometimes business owners jump right into a contract without even thinking twice about it. These are some of the most common mistakes business owners make with merchant accounts that can easily be avoided.

1. Signing before Comparing
Not comparison shopping is one of the worst mistakes you can make when looking for a merchant account provider. Research the company and check their Better Business Bureau (BBB) rating. Take the time to be selective and read the fine print in each contract so you'll be able to differentiate between a scam and a good deal.

2. Not getting it in writing
A salesperson may pitch an offer that sounds amazing, but you should also ask them to point it out in your contract. You don't want to be misled and stuck with costly fees due to a dishonest person vying for your business.

3. Lured in by free equipment
Free equipment will grab your attention, but make sure it isn't attached to hefty hidden fees. The credit card processing business is very competitive and companies will use all sorts of sale tactics to get your business. It's important to figure out the true cost of your merchant account before signing on the dotted line.

4. Ignoring the cancellation fee
Cancellation fees are meant to keep you locked into a contract. Consider the possibility of having to close down your business. You will be responsible to pay a hefty cancellation fee and possibly a reconditioned terminal fee for returning a used credit card processing machine.

5. Not asking any questions
Don't be too intimidated to ask questions about your contract. Some of the jargon used in a merchant account contracts can be confusing, but it's always best to ask for clarification. High fees, bad service and a long term contract can cause you to go out of business. Know what you're getting into or it will cost you thousands of dollars.

Article by Stephanie Armstrong

Published: February 15,2023