Navigating the diverse payment ecosystem as a merchant is complex and filled with numerous key partnerships. When it comes to working with credit card payment processors, finding the right relationship plays a critical role in your business’ revenue flow.
Of course, switching from one credit card payment processor to another shouldn’t be a decision that’s taken lightly. There should be two considerations to take into account: What to consider before switching — but also the benefits your business will receive from switching. This decision should be taken after evaluating some core data points about the evolution of the credit card payment processor ecosystem.
The first step in knowing you need a new credit card payment processor relationship is realizing the current partnership is limiting your business’ ability to scale. There are plenty of processors that can keep the status quo, but that won’t make it in today’s market. Payments are part of the entire customer experience and need a credit card payment processor that can develop alongside your business.
Experiencing too much friction? Perhaps too many chargebacks or credit card processing errors? Do you feel your credit card processing bills are continually growing faster than your actual business revenues? Cost, convenience and functionality are all key things to look for when evaluating credit card payment processors. Starting with those questions is a good starting point for determining if you’re in the right payment relationship.
What to Consider Before Switching Credit Card Payment Processors
Knowing the importance of the payment processing industry is critical in determining if you’ve got the right partner by your side. This starts with determining how your processing partner will enable a smoother payment process.
Payments are an integral part of the customer experience process. They enable a seamless checkout process and can make or break an e-commerce merchant’s ability to convert sales. Industry data from Baymard Institute indicates the importance of keeping customers happy during the checkout process. Its data shows that 28% of U.S. shoppers have abandoned a purchase simply because the checkout process was too long or too complicated.
These friction points can be directly related to the types of payment methods your credit card payment processors is able to manage, along with what information is necessary for those methods to complete a purchase. Data from BI Insider shows that 46.1% of cart abandonment occurs at the payment stage, with 37.4% occurring at the checkout login stage.
Although credit cards are the dominant method customers still prefer to pay, the right process credit card payments must be equipped to manage additional options. This includes the ability to integrate subscription billing, ACH payments, and mobile/digital payment methods. Today’s consumers are motivated by choice, and leveraging your credit card payment processor relationship to convert more sales and make the payment process smoother should play a major role in knowing if you’re in the right partnership.
Keep in mind this checklist that we’ve created to determine if it’s time to stay the course or move on toward a different option.
Factors to Consider in the Payment Processing Relationship
- Transparency in Contract and Pricing Models: Learn how you’re paying for your current contract and determine if it’s able to be easily adjusted without paying unnecessary fees. If you’re under contract, it’s important to do a cost-benefit analysis of switching. If the current relationship isn’t transparent about billing, determine when is the right time in your contract to start shopping around for another partner.
- Transition Period Between Old and New Credit Card Payment Processor: Switching credit card processors doesn’t mean your past merchant accounts are automatically terminated. Businesses must remember that there is typically a 3-day period after credit card processing has stopped to determine all pending transactions are settled. Once no more transactions are flowing across your system, then it may be the right time to confirm with your payment processor that the switch has been made. Not knowing these nuances can lead to unnecessary interchange fees.
- Consider What Equipment Is Included in the Partnership: Before moving on to a new payment processor relationship, determine what POS terminal or plug-in reader was included in the original agreement. If the provider offered the equipment as part of the package, they’ll likely want them back. Ensure you’re settling up with all necessary materials before engaging in a new relationship. With that said, your new credit card payment processor should offer your business with the latest and greatest equipment necessary to empower better, more flexible payment processing.
How Your Business Can Benefit From Switching Credit Card Payment Processors
Get your checklist ready when determining how specific credit card payment processors can benefit your business. Whether it’s because of the products they offer, the transparent/flexible pricing options or the easy-to-install and plug-and-play equipment available, these are all important factors in your new payment partner. Switching can seem overwhelming, but the right relationship will be a two-way street that provides you with the education and resources needed to make the switch as easy as possible.
Industry data from ACI Worldwide suggests that when merchants offer more options, compared to a single payment method, this increases the chance of conversion by 30%.
More choices for your customers provides businesses more opportunities to attract customers. Payment processing capabilities can be the first step in helping your business scale and boost revenues.
For example, Payline provides online processing plans that remove the complexity of online payments and choose a plan that fits your business. This includes the ability to integrate methods that best fit your business model. This strategy can help your business simplify and streamline payments for your customers by accepting all electronic payments online. That’s just the start of the benefits of finding a partner that’s focused on the entire payment customer experience.
Need in-store payment processing? Payline’s solutions can help your business easily accept credit payments over the phone and via invoices by manually entering transactions in its Virtual Terminal. As another perk, Payline is equipped with Level 1 PCI compliance processing solutions that protect your business and customers from unauthorized transactions with industry-leading card data security tools. These flexible integration solutions give you full customization and control over accepting payments to a system that can best suit your own customers.
The greatest benefits of finding the right credit card payment processor are knowing you’ve found a solution that gets your business paid faster and on your terms. With endless options to more quick and easy setups, you should look for a solution that doesn’t have on boarding delays. The better your payment process, the better the experience is going to be on the front and back end of your business. Having the power to customize your payment processing to integrate more methods can give your business a competitive edge and help influence customers to become loyal to your brand.
Ready to see if it’s time for a new credit card payment processor? Let us help you decide what may be missing in your current relationship.
Anna Kragie is a content contributor for Payline Data. She previously wrote for PYMNTS.com, as a Sr. Content Producer, where she focused on financial services and payments innovation, fraud and security, emerging payments, and FinTech news, research and thought-leadership content across the payments industry.