Ways to Save on Credit Card Merchant Transaction Fees

Ways to Save on Credit Card Merchant Transaction Fees

A processor should lessen your workload by handling merchant processing. They should free you up to focus on the customer, while feeling confident that your processing remains compliant and safe.  

By Richard Rodgers, Dannah Investment Group, LLC, and Aaron Cott, TRUECard

Cash or card? Apple Pay? Chip or swipe? Email receipt? These questions are asked of consumers at most businesses today at the time of payment. Credit cards are the primary payment method, requiring business owners to have efficient and reliable machines to process credit cards. Where employers get stuck is by assuming they have no say or option in the merchant fees associated with processing credit card transactions. What if you could find a way to save money each month simply by changing your credit card processing company?

5 Things You Should Look For:

  1. No Contract – Companies that do not require a contract focus more on retaining their customers by providing exceptional service, not by a signed document. Find a company that has a retention rate of 90% or higher, as this indicates a high focus on relationships. Also, make sure they do not require a termination fee.
  • Free Equipment – Look for a company that includes their equipment at no cost to you. Equipment is not cheap, and this approach supports a customer-first mentality.
  • 20% Savings in Fees – When looking for a new processor, make sure they can ensure long-term savings. Depending on the company, you can find an average of 20% savings in merchant fees.
  • Custom Plan – Usually the best cost-savings plan is custom to your business needs. Look for a company that does a full analysis of your transactions, as they can typically find solutions to accepting payments at a lower cost to you.
  • Subject Matter Expert – The goal of a processor should be to lessen the workload of managers by handling merchant processing.They should take the burden of PCI (payment card industry) and compliance regulations off your hands, serving as the liaison between card brands, including gift cards. This frees you up to focus on the customer, while feeling confident that your processing remains compliant and safe.  

In order to find a company that meets the criteria above, you will need one to two months of merchant statements for a comprehensive analysis to be completed. The purpose of reviewing multiple months is to ensure there is long-term savings, lessening any outliers. The merchant statements help the processing company learn more about your company, the type of cards you are accepting, how they are accepted (is the card present or not), and the volume of payments.

If you decide to move ahead with changing merchant processors, you can expect to receive the equipment within days. In addition, you should be assigned an account concierge who will walk you through the transitional stage of switching processors. 24/7 support is a must for you as managers and business owners, so make sure your company offers around-the-clock support.

Below is one example of how you can find savings in your merchant fees by finding the right processor.

 Current Card ProcessingFictitious DealershipVariance
Monthly Credit Card Sales$200,000$200,000$0
Credit Card Processing Fees$5,000 (2.5%)$0 (0%)$5,000
Experience Based Dividend$0$500 (.25%) *$500
   Monthly Merchant Benefit: $5,500

*Rebate paid to merchant

Without adding a new service or product to the business, this company will save $66,000 in just one year by changing merchant processors. Just imagine what savings you might uncover by getting quotes from different processors. All it takes is two months of merchant statements to see what savings you are missing out on. So, what are you waiting for?   


Securities offered through Kingswood Capital Partners LLC, member FINRA SIPC. Advisory services offered through Kingswood Wealth Advisors LLC an SEC Registered Investment Advisor. Dannah Investments may at times offer products or services that are unrelated to and unaffiliated with Kingswood Capital Partners and its affiliates. Kingswood Capital Partners and its affiliates do not provide tax, legal or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any transaction.

You May Also Like

How End-of-Year-Sales May Impact Auto Finance Digital Transformation Strategies

We still have a very paper-driven culture but we need to continue to shift focus to digitization to reduce risk and liability.

Following a challenging sales environment in 2022, a noticeable recovery in the automotive sector has stabilized in 2023. This year, even as supply chain problems subsided, new challenges emerged, such as the persistent risk of a potential recession, stubbornly high inflation, increased delinquencies and a UAW strike, which may impact production and, ultimately, prices.

The ROI of Giving Back

The key place to begin for any type of giving-back initiative is to determine what drives you and inspires you.

5 Technologies That Have Transformed Automotive Transportation

Recent advances in transportation offer efficiencies for drivers and carriers and provide peace of mind for customers. These improvements often offer cost improvements, as well as reduce liability for the carrier.

car carrier Ship.Cars
Skip the Stip: Lending Without Stipulations

New AI-powered technologies are creating more access to credit opportunities without the need for these stipulations and lengthy supporting documents.

EV Credits — Are They Worth It?

The industry brings with it environmental benefits, economic opportunities and infrastructure development, but are EV credits the way to go?

Other Posts

Utility Audit: More than 80% of Companies Overpay on Their Utility Bills – Are You One of Them?

Are you paying too much for your utilities? A utility bill audit by a trained professional can uncover errors and overcharges.

Unmasking Double Brokering in Automotive Transport: A Quick Guide

Transport and logistics is not immune to fraudulent practices such as double brokering. Here’s what you need to know to stay safe.

autosled - double brokering
Dial in the Details: Preserving Vehicles and the Profitability of Dealership Inventory

Making cleanliness a priority of each car will all but guarantee to lead to a more profitable season ahead.

Rob Harper - Ziebart blog
How to Boost Appointment Conversions with Positive First Impressions

It’s crucial to equip your staff with effective phone handling strategies that can make a lasting impression and persuade callers to choose your dealership.