Top 5 Payment Processing Myths Every Merchant Should Know

23 March 2021
 Categories: Business, Blog

Working with a payment processing service will allow you, as a merchant, to offer payment flexibility to your customers. Whoever shops at your place of business may be able to use whichever credit card, debit card, or other means of payment they want. Unfortunately, a number of myths are associated with payment processing services. 

1. Myth: All credit cards will have the same payment processing fees. 

In the world of card processing, not all credit cards are considered equal. Some credit cards come along with higher processing fees than others, even though you may find similar rates for processing multiple types of cards. For example, payment processing fees tend to be the highest for American Express cards, which have average processing fees of up to 3.30 percent of the purchase plus an additional $0.10 cents. 

2. Myth: Processing credit cards means customer data more likely to be stolen. 

Everything that takes place during a card payment transaction is digital, so assuming the transaction could put customer information at risk is a typical assumption. However, when you look at the encryption and security measures taken with a card payment compared to what happens with a paper check, you will actually find that digital card processing transactions are actually less risky. Payment processors go to extraordinary lengths to keep all sensitive data secure. 

3. Myth: You're only a high-risk merchant if you sell risky services or products. 

Being dubbed as a high-risk merchant when signing up for payment processing services can come as a surprise for some merchants. The general myth is that only very specific types of services and products could be considered high risk for payment processing services, such as adult services or gambling. However, "high risk" only translates to "risk of seeing chargebacks with credit card payments," which can apply to a number of types of services. Each payment processer determines what types of payments may be risky according to prior transaction chargebacks. Therefore, which type of product or service is deemed high risk can be ambiguous. 

4. Myth: You have to wait a long time to get paid when working with a payment processor for merchants. 

Most payment processing services make it a point to make sure you are paid on your terms. If you prefer all money to be held in a merchant account and then transferred to your business bank account weekly, monthly, or even daily, you can likely make arrangements for that to happen. 

5. Myth: You need different payment processors for in-store and e-commerce transactions. 

The best payment processors are versatile enough that they can handle card payments both in-store and online. Therefore, you should have no trouble finding a payment processing service that can meet both of your needs as a merchant.