Common Mistakes Business Owners Make With Their Credit Card Processor

Feb 15, 2017

Payment Processing Companies: The Common Mistakes Merchants Make

E-commerce has come a long way. Gone are the days when getting a merchant account for an online business was as challenging as a Greek puzzle. Nowadays, payment solutions are available to even the newest and simplest traders. As expected, merchants are opening processing accounts every day; and consequently, many are signing contracts unbeknownst to what they are getting into.

The following are some of the most recurrent mistakes that business owners make when choosing their processors, and how best to avoid them.

  1. Skimming through the merchant contract

Applying for a payment processing account involves filling some forms and signing an agreement. Many applicants are usually willing to submit all the relevant information about themselves and their businesses, but when it comes reading the T&Cs of the contract, only a few take the time to go through the section carefully

The T&Cs section outlines the guidelines to be followed in the usage of the service, as well as your relationship with the account provider. Unfortunately, the documents are usually filled with complicated legal clauses and confusing wording, which automatically discourages the reader.

The most common eventuality of not reading the T&Cs is frustrations resulting from unforeseen charges. And when a merchant complains, you’re at fault because the information was in the contract all along.

  1. Committing to a volume-of-sales agreement

Some processors include a condition in the contract dictating the minimum amount of money a merchant must process within a specified period. Failure to meet the set target can result in increased transaction fees or other financial penalties.

A good number of SME owners either ignore or downplay this condition, which results in strained profits, bankruptcy and premature business closures.

When applying for a merchant account, ensure the contract doesn’t have any volume commitment. If it does and your processor is unwilling to negotiate, move on to another company. EMB is a good example of a firm that offers reliable processing services without volume commitments.

  1. Going with the cheapest option

Merchants are often swept off their feet with unbelievably low transaction charges and near-zero monthly charges, only to realize later that the processor either didn’t have the expertise they promised or had additional fees hidden in the contract.

Instead of rushing to shake hands with the most cost-friendly firm you can find, your priorities should lie with a processor has enough knowledge about your business, and is capable of servicing your needs as required.


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Having a merchant account allows an account holder to take advantage of merchant cash advances. When a merchant is approved for an advance, the business agrees to receive a lump sum of cash in exchange for an agreed-upon percentage of future credit card sales.

Pricing varies depending on the merchant’s industry, past credit card processing history, the type of business seeking the account, average ticket sales, and average transaction volumes.

Yes, EMB works with merchants who are building their credit, as well as those who have poor credit. EMB also approves merchants that have no credit card processing history and businesses that have lost their merchant accounts due to high chargebacks.

Several factors influence a merchant’s risk level. Though only one factor likely will not get a merchant classified as high risk, a combination of these may: business size, location, and industry, credit score, credit card processing history, a industry’s reputation for excessive chargebacks, a prior history of high chargeback ratios, and whether a merchant exclusively sells online.

Virtual terminals are stationed on a merchant’s website, making it easy for customers to make a payment or purchase online. Merchants or a payment processor can easily set up virtual terminals, so online businesses can accept credit and debit card and e-check transactions.

A merchant account is a business account with an acquiring bank. Without this business account, which actually works more like a line of credit, a merchant cannot accept and process credit and debit card transactions. Businesses need a merchant account to accept major credit cards via a static point-of-sale terminal, mobile card reader, or through a virtual payment gateway.

After filling out EMB’s simple online application and submitting any necessary, requested documents, many merchants get approved within 24 and 48 hours.

EMB specializes in working with high-risk merchants. EMB works with many merchants, including but not limited to businesses in these industries: gambling and gaming, adult entertainment, nutraceuticals, vaping and e-cigarettes, electronics, tech support, travel, high-end furniture, weight loss programs, calling cards, e-books and software, and telecommunications.

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