If you’re a business owner, you probably know the basics of credit card processing, but you might not know a lot about what’s going on behind the scenes. For example, what is a payment processor, and what do they do?
Your payment processor takes the credit card information you input and passes it along to the credit card network, which checks with your customer’s bank to make sure they have the funds. Your processor then passes along the approval from the network back to you.
Later on, they instruct the credit card network to go back to the bank of each customer, collect the amount of each transaction, and deposit the money into your account.
Here are some tips on what to look for in a payment processor:
- Look for someone with high security. Make sure that they’re PCI compliant. Ask them how they protect their customers’ information. Do they use advanced security measures like data tokenization? Where do they store the information?
- Consider a processor that doesn’t require a contract. If they do their job, then they shouldn’t need to keep customers locked into their services.
- Ask for references. They should have happy customers that have been with them for at least a year or two. This will also tell you whether they follow through with the rates that they promise.
- Make sure they can adapt to your workflow. Whether you handle payments through your accounting system or an online payment gateway, your processor should have the technology and software needed to set you up for success.
- Check to see that they offer good customer support. You want to work with a processor who makes themselves available to you. Is their support team in house? How long does it take to reach them on the phone?
Those are the basics! We hope this information helps you make an informed decision in choosing the right payment processor for your company.