The Ultimate Guide to Choosing a Payments Provider For Your Business

The Ultimate Guide to Choosing a Payments Provider For Your Business

Gone are the days of settling for an expensive and frustrating relationship with your payments provider. Begin by asking the right questions. 

It seems like every business we talk to is, at best, content with their payments provider, or at worst, ready to pull their hair out in frustration. It can be surprising that so many businesses settle for such a disappointing experience for such a central part of their business, especially when they no longer have to. The truth is that there are some great options available to businesses today, you just need to do a bit of research to find them. 

Traditionally, the whole landscape of credit card processing has been extremely difficult to navigate, and that was back when the only thing you needed to worry about was the rates! Now, you need to consider quickly-evolving hardware options, more robust software solutions, the explosion of online sales channels, all-in-one platforms, and a ton of new and novel ways for your customers to pay.

Luckily, with all the disruption in the industry – and in financial services in general – there has been a refreshing upheaval of the old guard, and an ushering in of a new way to look at accepting payments. While this is great news for businesses who have experienced disappointment and frustration with their credit card processors in the past, it’s also an excellent opportunity for new businesses who can avoid many of the headaches that used to just come along with accepting card payments. 

But with all these new options, it can be difficult to see the forest through the trees. If you’re currently shopping around for a processor, here is what you should be considering to thoroughly evaluate your choices and determine which solution is right for your business. 

How Does Your Business Accept Card Payments?

This is the first, most fundamental question you should answer about your business. Knowing how you’re going to accept credit and debit card payments can make it easy to eliminate certain payment processors right away. Here are some of the different ways you might be accepting card payments:

  • Card present payments from customers who visit you (or you visit) in-person
  • Card-not-present payments over the phone
  • Online credit card payments through invoices
  • Online payments through an online store or hosted payment page

Depending on the industry that you’re in, your business might need only one of the options above or it might need a unique combination of them all. By specifying your needs ahead of time, you can better evaluate each payment processor’s offerings. 

The traditional big banks have a long history of offering in-person payments, and they are the most likely to offer a variety of traditional terminals and stand-alone payment options that we’ve all grown up with. This makes them great for a business looking for a very traditional payment experience, but you will find they fall short if you want to add online payments for a more omnichannel experience, or if you want any sort of data or analytics to help guide your business decisions. While this option can work for merchants who want a more traditional and familiar payment experience, there are also other risks beyond the lack of features. You also need to look out for contracts, hidden fees, and rate hikes with these traditional bank processors. Don’t say we didn’t warn you!  

If you’re looking for a purely online experience for your payments, several technology-focused providers have popped up over the past few years who will be much better suited for your business than the traditional big bank processors. These can, however, be expensive services (complete with high processing rates) and it isn’t always necessary to go for a fully-featured, robust “website-builder” solution, especially when you don’t need it.

Finally, there are the hybrid or omnichannel payment processors that offer the requisite hardware for in-person payments, with a variety of software solutions that allow you to incorporate online payments with your in-person solution, all from one account. Many businesses will find they can benefit from having access to software solutions that allow them to pivot and adapt to changing business conditions or adjust their operations as their business grows. Again, these options can be expensive as well, especially if you’re being charged per tool, per user, per module, or per invoice sent, but there are some excellent options that won’t break the bank – more on that later. 

Your Monthly Volume Matters

When you sign up with a payment processor, they are going to ask you what your estimated monthly processing volume is, so it’s important to have an idea of what you expect to process on a monthly basis, even if it’s just an estimate. This is usually to determine your effective rate, but it can also be used to determine if they even want to bother doing business with you. If a processor doesn’t want to give you the time of day because you don’t process enough, that’s usually a red flag and it’s best to eliminate these options right at the start.

Payment processors that offer flat rate pricing with no monthly fee are best suited for businesses with low processing volumes, ideally a few thousand dollars a month or less. So for pop-up shops, farmer’s markets, and hobbyists, flat rate pricing can be a good option. With flat rate pricing, you know what you’re going to pay for each transaction, and it’s easier to predict and manage what your monthly statement will be each month. 

Always Seek Out Interchange Plus Pricing

If you haven’t heard of Interchange Plus pricing, do yourself a favor and get an idea of how it works so you can understand how it can benefit your business. There is a good reason why it is generally regarded as the most affordable way to accept credit cards, and it also allows for a very transparent agreement between you and your payments provider. Flat Rate pricing, while it may be simple to understand, employs rates that are simply too high (usually between 2.6%-3%) for most serious businesses to pay.

When you partner with a payment processor that offers Interchange Plus pricing, you are generally billed at lower average rates than other pricing structures. This is because, unlike Flat Rate pricing, you are able to take advantage of the fluctuating interchange rate and save money on transactions that are processed at the lower interchange rates. Another benefit of providers who employ Interchange Plus pricing is that they often offer volume discounts, meaning that the more you process, the lower your rate gets. Be sure to confirm what the different tiers and pricing differences are, as volume discounts can help you save money on your payment processing over time, making this type of payment provider ideal for partnering with long term as you grow your business. 

Ideally, you’ll be able to find a payments provider that openly offers this billing method to businesses of all sizes, but some providers reserve Interchange Plus pricing for only their higher volume merchants, so it is always worth asking. 

Customer Service is More Important Than You Might Think

Your payment processor is responsible for overseeing the majority of your cash flow and the funds that you rely on to run your business, and the best way they can demonstrate their commitment to this responsibility is by providing consistently excellent customer service. If an issue occurs, you want to be confident you can get in touch with your payment processor and that they will be helpful and quick to respond to your inquiry. 

Some considerations to make when evaluating a company’s customer service team are: 

  • Is their support team in-house or outsourced? An in-house team is more likely to have direct contact with the people needed to fix issues or communicate changes to services, whereas an outsourced team might not have the tools or resources they need to respond to complex inquiries or urgent issues. It can be incredibly frustrating to receive a templated response when you are experiencing a disruption to your payments service. 
  • What do the customer reviews say? Check a few different sites and see specifically what their customers have to say. This is a great way to see what kind of customer service other merchants have received. Most companies will have a mix of positive and negative reviews, but overall you want to get the sense that this is a company that cares about its customers and that is invested in resolving issues if they do arise. Also, be sure to check accredited institutions like the Better Business Bureau to understand what kind of reputation they have. 
  • How do they treat you? Try giving their customer service a call and seeing how they are before you’re a customer of theirs. By asking a few questions and testing out their customer service ahead of time, you can get a sense of the company and what your experience as a merchant might be. Ask to see a contract or the terms of service before signing up. If they refuse to share it with you, or if the details and fees in the paperwork don’t line up with what the customer service rep has told you, that should be a major red flag. 
  • How can you contact them? There are a variety of ways you can seek out customer support, including email, phone, chat, and social media. The right type of support for you will come down to individual preferences and communication styles, so there is no one right answer. What is important is that you can get in touch with your payment processor in a way that works for you. 

You Should NOT be Paying a Surplus of Extra Fees

As new payments solutions move further and further away from the “old ways” of the big bank processors, there are more progressive payments providers who have done away completely with the traditional practice of padding profits through charging exorbitant extra fees. With the options available to businesses nowadays, there is no way you should be paying any sort of setup fees, cancellation fees, administration fees, or anything that sounds like it’s coming from a bank or a telecommunications provider. 

First, start with reviewing the basics, including adding additional users, added fees, and PCI compliance. Ideally, you’ll be able to find a payment processor who doesn’t charge extra fees for extra services and tools or at least limits the number of extra fees they might apply. 

What Else Does the Payment Processor Offer? 

Confirming that a payment processor offers payments the way you need and for a fair price is just the beginning of what your payment processor can do for your business. Once you have narrowed down your selection to a few different companies that will allow you to accept payments the way you need to at a competitive rate, it is time to consider all the extras.

Most modern payment processors will offer either their own software or integrations and partnerships with other third-party companies to help your business do more. These tools can cover a wide range of functionality including:

  • Point-of-Sale Software
  • Customer Manager (CRM)
  • Online Store and Ecommerce adoption
  • Product and Inventory Management
  • Virtual Terminals
  • Comprehensive Invoicing
  • Recurring Billing
  • Customer Portals
  • Payment Pages
  • Developer APIs
  • Accounting Integrations

Having an idea of what your payment processor offers is helpful as your business grows and you need added functionality. While you’re completing your initial evaluation of the tools and software offered by different companies, be sure to confirm if these tools are either free, inclusive of a monthly fee or if you need to pay extra to access them. 

What About Hardware? 

Need to accept cards in person at your business? Well, you’ve probably noticed that there has been an influx of equipment options for processing credit and debit cards at the places you regularly shop over the last decade or so. There has been a sizable shift away from the “brick” credit card terminals that the big banks have traditionally offered toward smaller, sleeker, and ultimately more versatile devices that can do everything and more than the old, bulky terminals can do. 

You should be able to secure a payment device for your business that does everything you need it to do to keep up with current payments trends – accept tap (NFC) and chip (EMV) payments, feed transaction and customer data directly into your CRM, and the ability to use it as a mobile reader for trade shows or take it with you to where your customers are. Devices are mightier, more versatile, and more affordable than they’ve ever been, so settling for an expensive, bulky terminal from your bank is no longer your only option.

Why Not Go With a Household Name?

There are probably a few payment processing companies whose names you hear mentioned regularly, or you find that you often see their hardware when you’re out shopping. This can be a big bank whose name you recognize or sleek hardware that looks like it’s straight out of Silicon Valley. This makes it easy to assume that if so many people are using these companies, then they must be a solid choice. Not so fast. 

When it comes to payment processors, it’s definitely worth digging a bit deeper. The payments industry is changing extremely quickly, and it’s often the newer, lesser-known names that are providing the most value with their services. Once you start doing your research into the different options, you will discover less recognizable names in the payments space that offer more competitive pricing and a more robust technology solution. This is where the tips you’ve learned in this article can come into play. Even if you don’t know these companies by name, by grilling them about their pricing, features, hidden fees, and customer service, you can thoroughly evaluate their services. 

Things to Look Out for 

Now that you know what your payment processor should be offering, here are some things that you should watch out for: 

  • Hidden pricing details: Ideally, your payment processor will list their pricing information transparently on their website. If you can’t find the information on their website, and they instead prompt you to contact them or “get in touch,” it usually means they’re hiding their pricing for a reason. At the very least they should willingly give you the information when you contact their customer service. But if you are having a hard time getting them to confirm their pricing information or send you any of the details, it’s best to walk away. Any company that won’t openly share their pricing information is most likely hiding something.
  • They won’t share a contract: Asking to review a contract before you have to sign anything should be standard, especially when you’re signing up for a financial service. If your payment processor is pushing you to complete pre-approval or pre-application to see the actual contract, then you should consider this a red flag. 
  • Never Lease Equipment: This is a common industry practice, and often involves you paying for the base price of the equipment many times over. Avoid equipment leases like the plague. 
  • It seems too good to be true: Unfortunately, with most things in life, if it seems too good to be true, then it probably is. So when a sales rep offers you a “special rate” or a processing rate that is less than 1%, you should be extremely cautious. Any offer that seems overly generous is most likely hiding hidden fees, escalating rates, a long-term contract, or some other nefarious practice that could end up harming your business in the long-run. 

OK, So What’s the Best Option?

After making it through all of that information, you’re now ready to choose a payments provider. We’d like to introduce you to Helcim and what we like to call, Better Payments.  

At Helcim, we genuinely believe in partnering with our merchants instead of just trying to simply profit off them. We offer an omnichannel payment solution to meet all of your in-person and card-not-present payment needs. Whether you’re needing to accept contactless payments at your retail store, use QR codes or mobile readers at your pop-up events, create a complete eCommerce solution for your business, or send invoices through email and SMS, Helcim has all the payment tools you would ever need to serve your customers and get paid quickly. No matter what combination of tools you end up using, all of your customer, product, and transaction data is synced to your cloud-based Helcim account and easily accessible through any online device. 

We offer Interchange Plus pricing to all of our merchants, and you automatically qualify for volume discounts when your processing volume increases. On top of that, we don’t charge any hidden fees and all of our pricing details are listed plainly on our website for all to see. And what you see is what you pay, period.  

When you sign up for your Helcim account, you get full, unlimited access to our suite of payments and business tools that are all included for one low monthly fee. These tools open up more sales channels for your business and more ways to get paid faster.

If you’re applying our tips from the sections above, you might be wondering if this all sounds a little too good to be true. But don’t worry, you don’t need to take our word for it. Our customer and third-party industry reviews speak for themselves, and they all agree that Helcim is a great choice for businesses that want a better payments provider. 

If you would like to learn more or have any questions, our excellent, in-house team of Helcim Gurus are eager to answer your questions and help you find the right fit for your business. Go to helcim.com to sign up and get started right away. 

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