A study of Americans showed that 14% of us have more than 10 credit cards. Not everybody is in this minority, but the average American does have upwards of 4 credit cards.
As a professional legal business, should your firm accept credit cards? If you decide to do so, some smart choices can help you save a lot of cash.
The first step is to determine which method of credit card processing is right for your business:
Regular merchant services:
If a firm uses traditional merchant services and deals directly with credit card companies (like Visa, American Express, etc.), they will shoulder all the transaction and processing fees associated with credit cards.
Merchant account providers often charge statement fees (around $10 a month), transaction fees (a flat fee per transaction), an annual fee (ranging from $45-95), program fees (ranging from $5-25 a month), a discount rate (ranging from 1.95-5.95% of each transaction amount), and equipment lease fees (ranging from $29-79).
Sounds a bit steep? Well, read on.
Third party credit card processing:
On the contrary, if a firm opts for third party processing, the third party will shoulder the processing fees and the client will pay a convenience fee.
However, third party processing isn't free. One provider, Virtual Payment System, offers a portal for law firms to accept credit cards. VPS will pay the transaction fees associated with the credit cards, but the law firm has to pay a $100 setup fee, $15 per month, and $150 annually.
Other applications offer both convenience and savings. Accept by Phone gives users the ability to accept credit card payments using only their phone, and has a minimal monthly fee of $5 and a discount rate of 3.97% per sale.
While third party credit card processing may be good for small businesses, if your firm has a large volume of credit cards charges going through, setting up a merchant account could ultimately save more money. It all depends on the size of the business, and the client base.