Every company loves to have a low rate merchant account. After all, credit card processing companies charge fees for credit card processing, and when you have a low rate merchant account, more of your revenue goes towards profits and less towards payment processing fees. But how can one find a low rate merchant account in a misleading industry with confusing pricing plans? Here is PayFrog’s 4 step guide to finding a low rate merchant account.
Avoid the Big National Banks
Some people think that by obtaining their credit card processing through their big national bank, they’ll have an added layer of convenience. Nothing could be further from the truth. Because of their large size, you get treated like a number and not a person. You speak to a different person every time. The business bankers in the physical branches are not experts in payment processing because they also deal with checking accounts, savings accounts, money market accounts, and a plethora of lending products.
If you walk in with a merchant account question, they’ll usually make you call a different department for assistance because they don’t specialize in it themselves.
Lastly, it is EXTREMELY difficult to find a low rate merchant account at a big national bank. Think of all the overhead they have…thousands of branches and tens of thousands of employees. They must charge you an arm and a leg for a merchant account so they can cover their overhead and still make a profit for public shareholders. Big national banks are by far the most expensive places to get a merchant account.
You may ask, if I don’t use a large bank, who will I use for my business checking account and business loans?
Use Your Small Community Business Bank
We recommend small local business banks to handle your business deposits and financing. At PayFrog, that’s what we have always used. You won’t just get a bank account, you’ll get a designated business banker. You won’t just have an account, but you’ll have a relationship. Business is built upon relationships. Looking for a small community business bank in Colorado Springs? We endorse Eastern Colorado Bank for their excellent banking technology and customer service. We having nothing but good things to say about our experience with Eastern Colorado Bank since we’ve been banking there. Our designated business banker, Patricia Kessack, is wonderful to work with and makes our banking easy so we can focus on our business. Believe it or not, you can be happy with your bank! Check out Eastern Colorado Bank today.
Avoid the Payment Aggregators
There’s a growing number of companies who will process credit cards for you, without actually giving you a merchant account. The most common payment aggregators are Paypal, Square, and Stripe. They are not FDIC insured, and most of the time they don’t even offer phone support. If you’re lucky enough to find a customer support phone number, you’ll be speaking with someone overseas with a heavy accent who you can barely understand and who is reading from a script. You won’t get a low rate (or a merchant account) from a payment aggregator. 
They’ll usually offer simple yet expensive tiered pricing. For example, they may offer a single fixed high rate usually between 2.75% – 3.5%. If you ask us, we think payment aggregators are nothing but aggravating!
Find a Wholesale Pricing Plan
If you truly want a low rate merchant account, then you need a wholesale pricing plan. This is also known as “cost plus” or “interchange plus.” Here’s how it works: merchant account providers charge you their true wholesale costs for processing credit cards. This wholesale cost is called interchange, which is what processors pay to the card brands to process credit and debit cards. It is the same for every payment provider in the country. In addition to interchange, low rate merchant account providers will also charge a small fixed rate as their markup.
We at PayFrog have chosen to endorse and sell merchant accounts for a processor called PayJunction because of their low rate merchant account with simple, transparent, and wholesale pricing. See the pricing chart below:
Find a Low Rate Merchant Account Provider Local or Online
Online merchant services companies have much lower overhead than large national banks. You’ll get faster funding and better customer support from a merchant account provider than you will from a payment aggregator. Also, a wholesale merchant account provider will offer a much lower rate. If that provider has a local rep in the area, then you can get local, on-site service as well. Finding an online merchant account provider with wholesale pricing is your best bet. And you’re in luck! Because at PayFrog, we have been setting up low rate merchant accounts since 2010. It’s time for you to hop to it!
