How-to

How To Get Lower Payment Processing Rates

How to get lower payment processing rates instruction
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Josh Phelps
October 24, 2022


Lower payment processing rates are decided by the merchant account provider you choose. Each custom payment processor is different and has separate pricing models depending on your type of account. Mainstream providers tend to lock in steady pricing to compete with one another, but if you want lower rates you’ll have to meet certain qualifications.

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Negotiating Lower Processing Rates

Firstly, it’s important to keep in mind that every payment processor is a business. As such, they want to avoid risk and maximize their revenue streams. Utilize this premise as a negotiating tool to have them focus more attention on your file and offer decreased rates

  1. Leverage Your Size – Also called monthly volume in the processing world is your revenue stream that’s generated through steady customer transactions. This dictates the importance of your account as a customer to the payment processing company. For example, if you’re processing over $50K per month through your merchant account, you’re likely paying too much for processing fees. Businesses this size can negotiate with a new payment processor like Zen Payments to review your current payment structure and decrease your fees .
  2. Establish History – As your business continues to grow over your time your transaction history becomes more stable. This is good news for the bank that hosts your merchant account. The more likely they can count on your business to provide steady payments, the more room you have to request lower rates. Conversely, startups may pay a premium on their merchant account fees . If you are starting a new business and have less than six months of processing history, you’re considered a high risk merchant . Not to worry, after you’ve proven your business model is sound and steady income is flowing your risk profile decreases.
  3. Find Custom Payment Processing – Standard payment processing providers include PayPal, Square, and Stripe. These three are considered aggregate payment processors because they bundle merchant accounts together and have low risk profiles. Moreover, they approve accounts quickly which means they drop certain businesses after reviewing the contents of their site. They’re prices are locked in at around 2.9% of the total purchase and $0.30 per transaction.
  4. Ask To Negotiate – Many business owners often forget that in order to get lower fees, you have to ask. Like anything, the rates you pay are decided by the business your working with and can be lowered if you make sure they have skin in the game. Underwriters, sales people, and executives alike all have skin in the game and want to open your account. Be sure to ask for lower rates in order to establish a groundwork that your goal is to save money. If your business is fully qualified with high volume , a long transaction history, and isn’t in a high risk vertical, then you’ll likely get an offer from your merchant provider for lower fees.

Compare Businesses – There are numerous merchant account providers out there, and each of them looks at fees through their own lens. Some offer quick approvals at basic rates while others work with merchants to evaluate their specific business and provide the best rates possible when it comes to transaction costs.

Zen Payments its your solution to getting lower payment processing rates

What Is The Lowest Payment Processing Cost?

Custom payment processing on the other hand can go as low as 0.5% of the total purchase using what’s called interchange pass through pricing . In this model, a merchant pays the exact price for fees imparted upon the card providers. Visa, American Express, and Mastercard have baseline fees that cannot be negotiated. However, interchange pass through pricing is the lowest a merchant can ever get in for their payment processing fees.

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Josh Phelps is an experienced sales professional with eight years of expertise, including four years in payment processing. Throughout his career, Josh has successfully secured approvals for thousands of businesses, demonstrating his skill in navigating and optimizing the payment processing landscape.


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