If you accept credit card payments in your practice, do you keep tabs on the processing fees you’re paying on each transaction?
You should, because card providers have been raising their rates. In addition, there may be hidden charges you’re not even aware of.
“Most businesses don’t fully understand what they are paying in fees,” says this source.
Another tip: make sure your computer system is in compliance with Payment Card Industry (PCI) standards. If it isn’t, you could be slapped with hefty fines – or even be stripped of your merchant account altogether.
Interested in learning more about cyber security? Attend our free CLE webinar on August 14 on “Top 10 Things to Prevent a Data Breach?” Register here. It’s just one benefit of membership in the Alta Pro Lawyers RPG.
How to Save Money on Credit Card Processing
You may not fully understand what you’re paying in credit card fees. That’s understandable. The terms of service can be confusing, and the rules keep changing.
“Credit card processing may seem straightforward but there’s actually a lot to consider,” says the website CO. “Many variables can impact credit card payments, especially in a retail environment.”
Not only that, but there’s little consistency within the industry regarding processing terms, price variables, and even the definition of a “transaction.”
Here are 9 pointers that could save you time and money, courtesy of the U.S. Chamber of Commerce:
- Know that fees have been going up. The precise fee depends on the size of the transaction and how it’s processed. The average processing fee is around 2 percent if the card is swiped in person, but closer to 3 percent for online or phone orders. But fees have been rising. In April, Visa and Mastercard hiked their base percentage for certain transactions.
- Become a smart consumer. Shop around. Compare vendors. Ask your colleagues about their experiences.
- Read your merchant services contract. Especially the fine print.
- Read your monthly statements. Contact your service provider if there’s something on your bill you don’t understand.
- Maintain strong cyber security. “You must ensure your business complies with security measures set by the Payment Card Industry (PCI), the Chamber of Commerce advises. “As hackers continue to find new, more sophisticated ways to breach security systems, PCI compliance guidelines continue to change and adapt as well.”
- Realize that you are a prime target for hackers. “One study found that 46 percent of businesses surveyed had been victims of a data breach,” reports the Chamber of Commerce. “A study conducted by IBM found that the average time to identify a security breach is 197 days. And it took most businesses an average of 69 days to contain the breach. The financial damage caused by a data breach increased by over six percent in 2018.”
- Be aware of emerging threats. Smart cards and EMV chip cards come with built-in protections. As a result, hackers have changed their tactics to target phone and online payments.
- Adopt the latest security standards. New safety guidelines were introduced in 2018. These include: enabling multi-factor authentication, using anti-virus software, storing mobile devices to minimize the risk of accidentally recording customer information, and sharing credit card data only on an as-needed basis.
- Understand the risk. “Companies pay an average of $148 per lost or stolen record. And the bigger the breach, the more costly it becomes — not to mention the time lost and inevitable damage to your company’s credibility.”
The Bottom Line
To stay competitive in a cashless society, you need to make it easy for clients to pay your fees. Offering a range of payment options, including by way of credit and debit cards, is wise. Even wiser is keeping your processing fees as low as possible, making sure you are PCI compliant, and bolstering your cyber security to minimize your risk.
Protect your practice with cybersecurity insurance. We can help you get the right coverage for your needs. Get a free quote or more information here.
