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merchant account providers

5 Things to Look For When Choosing a Merchant Account Provider

Brant Schelhaas

The growth of ecommerce and mobile payments has opened the floodgates of entrepreneurship to millions of people. Startups are bursting on to the scene every day, ready to sell their ideas to the world, but before they do that, they’ll need to set up a merchant account.

Merchant accounts are bank accounts that allow businesses to accept payments by payment cards, typically debit or credit cards. With today's consumers holding an average of 2.1 credit cards and 1.3 debit cards (1), it's necessary for a today's businesses to be able to accept payment cards.

Fortunately for fledgling business owners, it's not too difficult to set up a merchant account. As long as your business does not pose any undo risk to providers, you will have no trouble finding lots of merchant account providers to choose from. The biggest challenge is selecting one that is a perfect fit for your company. Knowing what to look for will help you sort out the good from the bad, and the best from the good. Following are some things you should consider when choosing a merchant account provider.

Reliability

There is no such thing as a flawless payment solution, but some providers are more reliable than others. To find out how reliable the providers you are consider are, check review sites and see other businesses have to say. How much, if any, downtime have they experienced with certain providers? Also look for providers who have won accolades for reliability, and offer products designed to increase a reliable processing experience.  

Customer service

One true test of a good provider is how they deal with problems when they arise. You can put their customer service to the test by calling to see how competent and efficient they are at solving problems, particularly during peak hours in your business day. Look for a provider who offers customer service during the hours you are in business. One that offers 24/7 support is optimal. Here, again, look for a provider that has been recognized for customer service excellence.

Security

All businesses face the possible risk of cyberthieves who exploit vulnerabilities in merchant payment systems and steal customer data. Small business owners with no payment security protections are taking an enormous risk; all it takes is one data breach to close a business' doors. It’s essential to follow the Payment Card Industry Data Security Standard (PCI DSS), a global standard established by five global payment brands. Compliance with the PCI DSS is vital for all merchants who accept credit cards, online or offline, in order to help protect their customers' payment card data. 

Staying in compliance with the PCI DSS can be challenging for even the most sophisticated merchant. Security standards change as cyberthieves explore new ways of finding weaknesses in payment systems. Some merchant account providers offer PCI assistance tools and resources such as security scans, best practice advisement, and breach assistance, that can assist with a merchant's compliance efforts.

Protections

Even the best security protections cannot completely eliminate the risk of fraud. Businesses can reduce the risk substantially, but there is always a possibility of data theft. Companies that are victimized by a breach face enormous expenses, including a forensic audit of their systems, replacement card costs, non-compliance fees to financial institutions and other penalties.

Merchant rates

Although you shouldn't base your choice of merchant services provider on how much you will pay, rates are nonetheless an important consideration. Look for a provider that offers transparency into its rates structure, so you can understand what exactly you are being charged for, and when.  Review all the terms and conditions before signing an agreement, and ask questions if you are unsure about any of the fees. It's worth the time to research providers and choose one that works with you and gives the most straightforward answers.  

Some merchant account providers offer additional protections that help offset fees. Breach assist programs help merchants reduce financial losses associated with a data breach. Vantiv's Breach Assist solution, for example, reduces certain merchant breach indemnification obligations by up to $100,000 per merchant location, and up to $500,000 per event involving multiple locations. These protections can help you stay in business and upgrade your security even after a breach has occurred.

Today’s merchant account providers offer much more than a clearinghouse for transactions. Many provide additional services that help keep transactions running smoothly and customers protected from cyberattackers. By taking the time to find a reliable account provider that has reasonable fees and solid security protections, you will be well on your way to a creating a lasting and profitable relationship with your customers.

  1.       Vantiv and Socratic Technology survey, September 2015, Vantiv Fast Facts.

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