"Tedious, but essential"
Small business owners need to stay on top of their financial transactions to record sales, manage inventory, and prevent unnecessary losses. Monitoring your monthly payment processing statements might seem tedious, but it's essential. Here’s why:
1. High Processing Fees
Many merchants accept the processing fees listed by their payment processors without question. These fees can either be a fixed amount for each transaction or a percentage of the transaction value. They have the potential to significantly decrease profits.
Educational Tip: Regularly review your fees to see if you are paying more than others in the industry. This can give you the opportunity to negotiate better rates.
2. Hidden Fees
Hidden fees are another common issue that small business owners may encounter when reviewing their payment processing statements. Companies often bury these fees in the fine print, and they can quickly add up if not closely monitored. Examples of hidden fees include chargeback fees, PCI compliance fees, and statement fees.
Important to carefully review your statements to identify any unexpected charges and address them with your payment processor. To prevent losses and boost profits, regularly check your business's payment processing statements. Stay alert and proactive in monitoring them. This will help you avoid unnecessary expenses and maximize your earnings.
Don't forget, saving money on processing fees means more profit for your business. Payment processors might hide fees that they do not clearly state at the beginning. These fees can add up to a lot of money. They include setup fees, monthly maintenance fees, statement fees, and PCI compliance fees.
Educational Tip: Ensure you receive a detailed monthly statement. If your processor does not provide this, request a detailed breakdown of all charges to uncover any hidden fees.
3. Passthrough Fees
Technically, passthrough fees, such as interchange fees, should be consistent across the board since they are not marked up. However, discrepancies can occur, especially if your processor adds hidden markups.
Educational Tip: Monitoring these fees is crucial. Additionally, leveraging optimizations for different card types (like level 2 and level 3 processing) can significantly reduce costs.
4. Equipment Costs
The initial investment in payment processing equipment and ongoing upgrades can be a major expense for many businesses.
Educational Tip: Make sure to review your equipment leases or purchase agreements regularly. This can help you save money and avoid overpaying for technology that no longer suits your needs.
5. Chargebacks and Fraudulent Transactions
Chargebacks and fraud are perhaps the most direct ways businesses lose money. Not only do you lose the sale, but you often incur additional fees.
Educational Tip: Implementing effective fraud detection and prevention measures and training your staff in these areas can mitigate risks. Furthermore, discussing chargeback terms with your processor can potentially lower the costs associated with these losses.
Introducing the "Fee Rover”: Your Tool for Financial Monitoring
At Feerover.com, we understand the challenges merchants face with payment processing fees.
Our software quickly reviews your merchant statements to find hidden fees or excessive credit card charges. It is designed to identify any extra costs you may be paying. Gain clarity on your payment processing costs and receive actionable insights to improve your financial strategies.
Click HERE to get a free analysis.