Choosing the best merchant services provider for your business requires research and an understanding of how the industry works.

There is a multitude of elements that you need to consider when examining the various merchant services providers available to you, including whether or not they meet PCI compliance, how innovative they are and whether or not their fraud prevention tools are the best in the industry.

Here are some factors that you should look at when choosing the best merchant services provider.

PCI Compliance

Every business needs to be certain that it works with a payment processor that meets PCI compliance. Online merchants must be sure to process transactions through a PCI compliant payment gateway. There are also different levels of compliance, with Level 1 being the highest level of the standard.

Smaller online merchants, in particular, make enticing targets for bad actors. The bulk of security attacks have targeted these types of merchants, compromising millions of sensitive records. In addition to the severe penalties for merchants who are breached and have customer data stolen, there is the steep cost of lost customer trust. Without having a merchant services provider with the right security tools that meet PCI compliance, businesses are at risk and the subsequent costs could shut down the business entirely.

Pricing Structure

Understanding the pricing structure of the merchant services provider you’re working with is important. Some will offer interchange plus pricing, where they pass through the interchange costs they incur plus a markup, which may be a percentage of the transaction’s amount, a flat per-transaction fee or a combination of both. Other factors can determine what the interchange rate is for any given transaction, including:

  • Your type of business and the industry (MCC code);
  • Processing method (card swiped, keyed by merchant, ecommerce);
  • Transaction data submitted (must be proper and complete);
  • The type of payment card used (consumer credit, debit, business, and rewards).

Some providers will offer tiered pricing, which are often broken down into Qualified, Mid-Qualified and Non-Qualified tiers. Others may offer a blended rate. When determining which pricing structure is best for your business, consider the size and volume of your transactions, as both may impact how much you pay.

Innovation and Compatibility

The best merchant services provider will be up to date with the latest technological innovations and consumer trends and preferences. The e-commerce industry evolves at a blistering rate and your payments processor should be able to keep up with these changes. This means that if you decide that you want to accept new payment methods such as Apple Pay or implement the latest security protocol, like 3D Secure 2.0, you have the ability. Your processor should be able to accommodate all of your payment processing needs.

The company you work with has to also be aware of the latest trends in payment processing and cyber threats or vulnerabilities. You merchant services provider also needs to be compatible with other software that is used to run your online shop. There are several moving pieces to selling and processing transactions online, and the best merchant services providers will be able to easily integrate with your existing infrastructure.

Fraud Prevention

There have been plenty of high-profile data breaches recently that have affected the likes of Facebook and Twitter, but smaller businesses are targeted as well. Your merchant services provider should make it a priority to keep your customer data and proprietary information protected.

The best merchant services provider will have secure payment gateways along with automated fraud prevention tools that can combat credit card fraud to help identify and stop transactions that may seem suspicious.

Choose a merchant services provider that leads with innovation and has access to the latest fraud management and monitoring systems. Do your homework and ensure that your industry is one they cater to. High risk merchants are behooved to work with a specialized payment processor who can accommodate more complex needs.

Reputation and experience will help you determine whether or not a merchant services provider is right for you. Choose a merchant services provider that acts as a trusted partner and that can help advise on the best payment processing strategy for your business.

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