Managing a small business is not an easy task. Sadly, another challenge for many small business owners is the fight over rising interchange fees – the fees that credit card processors charge for every credit card transaction that takes place. What was a $16 billion industry just 7 years ago has turned into a huge $48 billion worth industry (in 2008). Small business owners are watching their profits go down as they have to cut their margin because of the money that is spent on interchange fees. 
This issue is expected to deliver tougher times for all of us over the next few years. Soon, you might find it impossible to fill up your gas tank if you pay with a credit card. Operators at gas stations are losing money because they pay an interchange fee on every gallon of gas their customers charge. Due to the increase in fees, profits go down. And due to the rising cost of gas, some smaller store owners just can’t afford to pay the interchange fees. In some cases, the interchange fees cost more each month than gas purchases bring in.
Small business owners are caught in the middle of all this. In order to stay in the competition, businesses cannot completely refuse credit card payments. On the other hand, they feel as though they have no power to negotiate the fees. Thankfully, Congress has heard about this dilemma and has decided to step in. There is an anticipated legislation that will authorize the analysis of hidden fees that businesses report as being unfair. While some dislike the idea of government getting involved, others are hopeful that new rules will ease the burden on small businesses.
If you own your own business and feel that high interchange fees is hurting you then, there are some steps a few steps that you can take.
First, find out merchant account providers that offer “Interchange Plus”. This is an uncomplicated pricing scale that was available only to big businesses. Now, smaller businesses can also take advantage of this simple alternative to the complicated, tier-based pricing structures currently in place. Some businesses save a great deal each year just by taking part in an Interest Plus plan.
Another thing you should do is lookout for hidden fees. Do not sign to contracts that make you pay an interchange fee for declined transactions. Instead, try and find a contract that does not require you to pay for unconstitutional charges. Take your time in asking questions and reviewing the contract, before signing it.
Last but not least, look for merchant account providers which offer good customer services. In troubled times, you would like the company’s customer services to get the situation strangled out as soon as possible. Companies that offer optimum prices and lack in customer services need to be ignored. Always keep this in mind that with customer service, you usually get what you pay for.
You’re right on with this blog post. Sounds like you may have learned some of these lessons the hard way; am I right?