Merchant Services is an all encompassing term that signifies a business’ ability to take payments from a customer. Those payments include credit/debit cards, check services and gift cards. We provide merchant services for all types of businesses, including:
- Restaurants
- Retail
- Mobile
- Service
- Internet / eCommerce
- Home Based Businesses
Oftentimes, businesses are hesitant to accept credit/debit cards because they feel there are costs involved. Yes, there are. But those costs should be inline or less expensive than non-electronic payment methods. For example, a business that accepts cash only has no merchant services fees. Statistically however, they have the greatest risk for employee pilferage as they only do cash.
When you accept payments via the mail, your Days Sales Outstanding (DSO) increase. That means the total time from when the order is placed to the time you have money in your account, it could be 30 or more days; especially if you have Net +15, Net +30 and so on. When you accept electronic payments, albeit checks or credit cards, the money is deposited immediately, there are no NSFs and no trips to the bank.
When you consider whether or not merchant services is right for your business, consider all of the implicit as well as the explicit costs of processing. For example, if an office manager in a dental office is spending 30 minutes a day preparing checks and cash for the bank and has a round-trip time to the bank (including standing in line or the drive through) of 30 minutes, then that office manager is spending one hour per day on non-value added tasks. If the office manager makes $35,000 per year, then their unencumbered hourly rate is $17.50 per hour. Multiply that $17.50 per hour times 5 days a week, times 50 weeks per year and you come up with a non-value added cost of $4,375! Further, this is time that the office manager could have spent on other, more important tasks. The cost to process the payments would have been a fraction of that amount.
At Merchant Services, we provide Cost Plus processing. This means that you pay the posted rate for a specific card type (there are roughly 250 of these card types between Visa and MasterCard) plus a small fixed fee noted in basis points. A basis point is a unit that is equal to 1/100th of a percentage point. So for example, 20 basis points would be 20/100th of one percentage point or .0020. We provide this Cost Plus processing as we feel it is the most fair and cost effective way for a business to process.
You can see the current Visa Interchange rates by clicking here. MasterCard’s is posted here.
While Interchange may seem a bit complex at first blush, we can explain it in layman’s terms that are easy to understand. Call or contact us today for cost-effective processing and technical solutions.