So, the new credit card processing company has done their analysis of your current situation. They've given you a proposal and you're ready to sign on the dotted line and make the switch. Hold on their cowboy, you best give this a little more thought.
Typically, most processors contract terms are for three years. If you've been with your current provider for less than three years, you'll likely incur the dreaded, and usually unexpected early termination fee if you make the switch. Get out your original contract and check out the fine print for yourself. You'll find fees of $250 or more. That kind of cost could literally wipe out any potential savings you may receive from making the switch. So, what do you do? Here's some ideas.
First, you could consider contacting your current provider and let them know that you have an offer on the table that beats their rates. Oftentimes, they will match, or even beat, the rate (as long as it is a legitimate one...in writing) to keep you in their portfolio. If you absolutely have problems with the current provider and want to leave anyway, here's another suggestion.
Many times, processors will charge you a Monthly Minimum fee (normally $5-20). Typically, it never comes into play because your processing volume and subsequent fees are more than what the minimum is. So, let's look at some numbers here. Let's say that you've got a good deal on the table and you really want to make the switch. You check your existing contract and discover that you have an Early Termination Fee of $250. And, let's further assume that you have a year to go on your original contract. Make your switch but instead of calling and cancelling your prior contract, just keep paying the Monthly Minimum for the next twelve months. So for example, let's say it's $10 monthly, you end up only paying $120 instead of the $250. The one thing you want to keep in mind is to be sure and contact the previous processor near (not after) your original contract term expiration and cancel then. Otherwise, it will automatically renew for a year and you'll be paying the minimum for the next twelve months.
It's important to stay on top of what's going on with your credit card processing rates. We have seen several increases in interchange this year and some, if not all, have been passed on to you. If you don't fully comprehend your statements and all your rates and fees, get in touch with me and I'll help you to
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