Below is a post from Chris Miller on DistributorTalk (DT). For some in our industry it may not work efficiently enough, but it's an interesting angle on minimizing credit card processing fees.
For those who are members of the DT forum, here is the thread. http://www.distributortalk.com/forum/showthread.php?t=7377. For those who are not, here is his original post.
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With all the posts and questions about credit card processing I had to set the record straight. I have been through it all and believe me when I tell you I have found the BEST way to accept credit cards. This thread will save you the HOURS of research that I have already done and a ton of money too!
First off I use the Paypal Virtual Terminal to process all cards. I collect my customers credit card info myself and run the cards so they do not even know I use Paypal. The charges appear on their statements under MY company name.
Because of my volume I fall under the "Merchant Rate" of 2.2% + $0.30 per transaction as shown in the attachment. I also pay $20 / month and NO OTHER FEES. I am able to process Visa, Mastercard, American Express, & Discover all for this one low rate even with the card not present. Best of all I can do it ALL ONLINE in just a few seconds.
The funds are then stored INSTANTLY in my paypal account where I can immediately access them at any ATM with my debit card, with any merchant using the Paypal debit card (Has a mastercard logo) OR I can transfer it out to a bank account of my choice. Every other merchant account makes you wait DAYS before you can access the funds. Not with paypal though!
Now that I have collected payment from my customer (98% pay me with credit card and they are HAPPY about it) I can turn right around and pay the supplier upfront with my Paypal debit card and I get 1.5% cash back in my account for doing so!
With this system you can keep your credit card processing rates EXTREMELY low and you can improve cash flow too.
What's better? My paypal account is a MONEY MARKET fund that earns 5% on all of the businesses money each month while it sits there.
I seriously cannot imagine running my business any other way. I have been through the invoicing, collections, sending out checks, etc and I will never go back. This makes things SO MUCH easier and saves me a ton of TIME and MONEY which means more time to SELL!
If you want to be set free and enjoy a new, easier way of handling your companies AR/AP I HIGHLY recommend Paypal and their Virtual Terminal. |