Well, when my company was looking to establish their online presence, we first looked at the cut the payment processor would take -- obviously, the bigger their cut, the lower our profits. While we didn't necessarily decide on the lowest possible, we wanted someone who's rates were competitive.
We also looked for someone that seemed reliable. In our case, we started with a payment processor that was recommended by our hosting company (we trusted the hosting company thanks to several years of experience with them). We later moved to another payment processor that offered us a better discount rate and was recommended by our bank.
Once you've found processors that don't charge an arm and a leg, and that seem to be trustworthy, then it's a matter of reading the agreements carefully. You might even want to invest the money in having a lawyer review the agreements, just in case. The legalese can trip you up if you don't read closely and make sure you understand every clause.
How often do they send you your money? Many traditional processors send daily; some other services only settle up once or twice a month. This can make a big difference in your cash flow.
Do they hold back funds for any reason? Some will hold back funds on new accounts until you establish a history with them, or if they believe your business is more prone to fraudulent transactions, or just because they feel like it. Eventually, you'll get your money, but how long are you willing to wait? This doesn't necessarily mean they think you're a crook -- remember, you have to establish trust with
them, same as they need to establish trust with
you. And as a new business, you don't have a previous track record for them to rely on.
What transaction limits are they willing to allow you? Many processors will place limits on new accounts: so many dollars per month, so many dollars per transaction, maybe both. As with holding back funds, they may do this until you've established a track record with them -- or they may have some kind of permanent limits. Are the limits (if any) reasonable compared to your expected average transaction and/or monthly volume? What happens if your products "take off" and you exceed your monthly limit? (Some will simply shut you down until the next month rolls around. You don't want that, obviously.)
What are their cancellation policies? Sometimes, no matter how careful you are in making your choice, you need to make a change. Or maybe something better comes along. Whatever. If you're locked in to a long term contract with big penalties for early cancellation, you could find yourself stuck in a less-than-optimum situation. Be sure there is some way for you to get out of the agreement without it costing you an arm and a leg.
And, of course, what sort of support do they offer? Trust me, things will go wrong. There will be errors, transactions will go awry, things will get out of sync, you'll have questions. Can you call them in the event of an emergency issue? Or are you limited to filling out a problem report form on their support website and waiting for a reply?
More than five factors, sorry...
--Torka
What’s Important To Look For When Choosing An Online Payment Processor?
I have worked for cardpay.net for three years. The owner, Perry, is completely honest and reliable.
