Stuck in an agreement with a credit card processor?

While its becoming less common, there are still processors who lock merchants into three to five-year agreements with early termination fees ranging from $250 to over $5,000. Many also have auto-renew agreements, making it difficult to ever switch processors. Fortunately, as a merchant you do have some tools available to you when it comes to getting out of your contract early.

Leveraging your Banking Relationship

Most merchants were referred by their credit card processor through their banks. Most processors are either bank-owned, or have a profit sharing agreement with the bank. For example, Bank of America and Wells Fargo both refer their clients to FirstData merchant services.

If this is how you got into your agreement with your credit card processor, you may be in luck. Don’t be afraid to contact your bank rep and use your existing banking relationship as leverage.

Request that the bank waive the early termination fee. Let them know that turning down this request could lead them to losing your banking business altogether. You'd be surprised at the effectiveness of this method. While the banks see credit card processing as a value-added service that generates increased profits, in the end, they often care more about keeping you as a banking customer.

Don't Let Another Processor Pay for Your Cancelation Fee!

While this may seem like an easy solution, remember that there is no free lunch! Any processor willing to pay for your cancelation fee is generating that revenue through fees they charge right back to you, such as setup fees, application fees, high processing rates, lease agreements and other hidden fees. Don't let yourself go from one bad processing relationship to another.

Be Wary of Equipment Lease Agreements

Unfortunately, equipment lease agreements last years (48 to 60 months) and are most often tied to a non-cancelable personal guarantee. It can be very difficult to end a lease agreement. Instead, contact the leasing company (usually a third-party) and inquire about lease buy-out options. Most leased terminals are also unlocked, and can often be reprogrammed by your new processor.

We've always taken pride in being the only Canadian processor to display our complete pricing online. Now we can take pride in being one of the only providers in the country to offer certified merchant accounts with month-to-month pricing.

At Helcim, we offer month-to-month credit card processing equipment you can buy, or lease month-to-month. Learn more. 


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