Do's and Don'ts of opening and managing your merchant account.

The "DO's" When you are setting up your merchant account:

  • Do research credit card processing and develop a basic understanding of how merchant accounts work.
  • Do your initial research 1-2 months before you need to be set up.
  • Do apply and complete the setup process at least 2 weeks before you need to run a transaction.
  • Do get setup with  PIN debit and a PIN pad if you are a retail location and your average ticket is over $25.00.
  • Do get set up with B2B merchant account if you sell mainly to corporations or government agencies.
  • Do get set up with a large ticket merchant account if you have very high transactions $5,000 and up.
  • Do get set up as a seasonal account if you are open for only select months of the year.
  • Do use a wireless terminal if you are a mobile business and expect a steady amount of sales.
  • Do accept American Express - American Express card holders statistically spend more per sale.
  • Do accept American Express if you sell to other businesses.  Amex can make up for close to 50% of your sales.
  • Do look into other services that can help your business grow such as Gift and Loyalty Cards.
  • Do be very cautious of creative rates and different rate programs.  Make sure you thoroughly understand them.
  • Do find a business and a representative that will answer all your questions and one that asks you questions.  Every business is different, and a one size fits all merchant account is a bad fit for everyone.
  • Do ask your representative for a list of clients that process through that company.  Ask for names and phone numbers and if you have permission to call.
  • Do ask for all the rates and qualifications if you are on a tiered or bundled program.
  • Do ask for interchange qualifications if you are on a pass through program - go to visa's site to verify interchange.
  • Do become PCI compliant no matter how small or large your business is.
  • Do make sure you understand the fees and provisions of your contract before you sign.  If the company you're thinking about using won't explain them to your satisfaction, find another one that will.

The "DON'Ts" When you are setting up your merchant account:

ŸDon't inherently think your local bank has the best service and lowest price just because you are already a customer.

ŸDon't take any offer you receive without looking at other companies first.

ŸDon't take the lowest offer you find because it is the cheapest.  Go with the business and representative you trust.  Processing through a bad company can hurt your business. 

ŸDon't automatically use your accountant's recommendations without first looking at the company yourself and comparing other options.

ŸDon't confuse a debit rate with a credit rate.  If it is below 1.6% it's either a debit rate or you're going to get charged somewhere else.

ŸDon't sign a lease unless you are 100% sure you want to, and you know how much more it costs than purchasing.

ŸDon't  go with a free terminal program just because you don't have to pay for the equipment.  Processors make up for the lost revenue in other areas, such as monthly or years fees.

The "DO's" After you're set up:

ŸDo check your bank account for the first few weeks to make sure you're getting your money.

ŸDo check your statements.  Ask your representative or company with your first statement to give you a review and make sure everything is as promised.

ŸDo keep your credit card terminal in a safe place away from liquid and heat. Always use a surge protector.

ŸDo control and monitor returns vigilantly. A lot of fraud is committed by employees returning $$ to their own cards.   You can ask your representative to password protect that function.

ŸDo keep receipts locked up, allowing access only to privileged individuals.

ŸDo contact your provider or representative if the full credit card numbers are being printed on your customers receipt copy.

ŸDo respond to chargeback's or retrieval requests immediately.

ŸDo contact your processor or representative if you need to process an abnormally large transaction. ($1,000 when your normal ticket is $50.00.)

ŸDo contact your processor or representative if you are going to process a large total volume for the month. ($50.000.00 when your normal monthly volume is $10-$20,000.00).

ŸDo display your refund policy in your store and on the customers receipt.

The "DON'Ts" After you're set up:

ŸDon't process your own credit cards through your own merchant account.

ŸDon't process a payment for another company or individual.

ŸDon't require a minimum purchase amount for credit card payments.

ŸDon't charge a service fee for credit card payments.  You can discount for cash purchases, but you cannot charge extra for credit cards.

ŸDon't ever refund a credit card payment as cash or check. Only return to the card that was used to make the purchase.  Otherwise, the customer can take the cash and still make a chargeback, so you lose twice.

ŸDon't let anyone reprogram your credit card terminal unless you are absolutely sure they work for your processor.

The "DO's" After you've been processing for a while:


ŸDo continue to look at your statements and make sure there is nothing unexpected on them.

ŸDo give your processor 1 week if you need to change bank accounts.

ŸDo ask your processor or representative for a rate review if your sales have increased dramatically since you first started processing.

ŸDo refer colleagues to your processor if you are satisfied with your service. You can save your friend the trouble of finding a decent company to process and you may be entitled to a referral fee.

ŸDo keep up with PCI compliance requirements for your business. Costs of a data breach for a non-compliant business is huge.

ŸDo give more than on months notice if you need to shut down your account. Make sure you know the terms and conditions of your account.  If you need to send a letter always fax in a letter of termination and call to confirm that it was received and the date is correct.

The "DON'Ts" After you've been processing for a while:

ŸDon't close your bank account until your merchant account is connected to a new one.

ŸDon't wait to contact your processor or representative if something is wrong or you have questions.  They work for you, not the other way around.

ŸDon't neglect to pay your final bill with your processor. You can be put on a Match List preventing you from ever accepting credit cards again.

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