Don't fill out that merchant account application online until you read this

STOP!

Don't fill out that merchant account application online until you have read about the 5 mistakes that merchants make when they apply for a merchant account.

It never fails. All of us have a tendency to act first, think later. It must be wired down deep inside. You know, fire-ready-aim instead of ready-aim-fire.

If you are looking for a merchant account, you can't let that happen.

Your business is too important, and your merchant account is the lifeblood of that business. It's where payment processing gets done.

To put it another way: A good merchant account won't make your business, but a bad merchant account will break it.

So before you fill out that merchant account application online, here are ...

Five mistakes no merchant can afford to make

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#1 Focusing exclusively on any one fee or rate

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It's so easy to see how this mistake is made. After all, it's a tactic any salesperson uses to sell anything: Pick one or two features that make your product stand out and hammer them home while downplaying everything else.

Here's the truth: Companies who quote extremely low rates are usually trying to distract you from additional fees they charge that can have you paying much more in the long run.

Filling out a merchant account application online may be free, but a mistake here can cost you.

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#2 Getting roped in to 'proprietary' equipment and leasing

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Most equipment, such as card swipers and printers, can function with multiple processors. When you hear that there are 'only a couple models that work with out merchant account,' be suspicious. It's possible that is true, but unlikely. And either way, it's unusual.

Sometimes you will hear there is a "reprogramming fee" if you buy equipment elsewhere. They use this to pressure you to buy or lease their equipment. Bottom line: Reprogramming is simple and inexpensive. Don't fall for it.

And never, never, never lease. Leasing does two things: It makes the product cost more, and it locks you into a long-term agreement. Bad news on both fronts.

If you can't afford the equipment, consider payments with a goal of owning. And consider whether you have the budget to be looking for a merchant account.

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#3 Signing a bad contract

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What is the best way to know you may be looking at a bad contract? You are getting pressure from the merchant account representative. Get off the phone and away from that pressure so you can think with a cool head.

If possible, don't sign a contract.

If you do sign a contract, make sure it is for the shortest period possible and ensure that it doesn't have unreasonable termination fees. Some providers prefer you cancel so they can collect a hefty termination fee.

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#4 Putting a merchant account ahead of a shopping cart

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Here's another case of fire-ready-aim. There is no reason a merchant account should decide your shopping cart software.

There are literally thousands of shopping cart programs out there to choose from, each customizable in a myriad of different ways, and most importantly, designed to work with a variety of payment gateway.

So before you fill out a merchant account application online, choose your shopping cart.

The shopping cart for your website is too important to come last in the payment processing equation. After all, a poor shopping cart will lose you sales. Without the sales, who needs a merchant account?

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#5 Getting a merchant account before you need or can afford one

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It's easy to fill out a merchant account application online...

However...

If you process less than 50 transactions a month, don't get a merchant account (there are exceptions, of course, but processing charges, monthly fees, and monthly minimums will eat away at your income unless you are selling high-priced goods).

Instead, consider a third-party processor. While you give up direct control of a merchant account when you use the third-party processors, you won't have a contract, monthly fees, minimums or a credit check to go through. And if you use a well-regarded processor like PayPal, you won't even lose any credibility.
Once you are seeing more traffic and more transactions, you can easily make the step up to a merchant account.

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There are certainly other mistakes merchants make, but if you can bring yourself to stop for a moment and, before filling out that merchant account application online, review these critical five areas, you will be on your way to getting a truly inexpensive merchant account: One that saves you money in the long run because it is a good fit for your business.

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