Before you enlist an additional payment processor to collect payments for your business, it is important to consider the risks associated with having more than one merchant account.
While many business owners believe there are benefits to using multiple merchant accounts for the same business, working with various vendors and contracts takes time, money and energy.
When working with the proper gateway and a single payment processor, collecting payments with one consolidated merchant account allows business owners to save money and time, mitigate risk, protect cashflow, and plan for growth.
Here’s Why It’s Best to Have One Consolidated Merchant Account:
Reduced Fees and Predictable Costs
Using more than one payment processor means paying multiple recurring account maintenance and processing fees. If a business has numerous active merchant accounts, it is likely they are losing money by paying the same PCI compliance and maintenance fees to various third parties. Consolidating merchant accounts and processing through one provider ensures businesses are paying no more fees than necessary to collect electronic payments.
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Merchant processing fees come in several forms–flat, interchange, tiered, interchange plus—and no two merchant providers bill quite the way. Statements are already cumbersome to decipher, so when multiple merchant providers with varying fee structures are thrown into the mix, it is nearly impossible to understand what is actually paid in processing fees each month.
Choosing a single merchant provider, particularly one with transparent fees and easy-to-read electronic statements, helps business owners more accurately predict monthly overhead costs, an essential part of running a successful business.
Lower Risk to Protect Your Business
It is a common misconception that having more than one merchant account is safer for a business in the event that one is compromised or shut down. Yet, quite the opposite is true. When a business opens a merchant account to collect electronic payments, the signer agrees to terms and conditions that often include a non-compete clause. If it is revealed that a business is collecting payments through multiple merchant accounts simultaneously, the processer may consider them ‘high risk.’ The processor then reserves the right to close the account and place any unsettled funds on hold. By consolidating merchant processing accounts, businesses are more likely to avoid unnecessary shut downs and subsequent funding delays, which can halt business operations.
Access Insights to Plan for Growth
Businesses that collect payments through one merchant account, as opposed to many, have access to concise reporting that summarizes business performance at a glance. This information allows businesses to quickly and easily reconcile, freeing up time and energy that can be refocused on revenue-producing activities.
When businesses use a consolidated merchant account, payment data is easily translated to business insights, which are used to understand business trends and empower businesses to more effectively promote their offerings and grow.
Streamline your Payment Experience
Consolidating merchant accounts streamlines the payment collection experience for the customer and business owner alike. Utilizing one merchant account plugged into a gateway that offers multiple payment channels empowers customers to pay with the method that is most convenient for them. This improvement to the customer experience encourages more timely payments and boosts cashflow. Since customer payment data is securely stored in one place, return customers are able to make future purchases with ease, encouraging more revenue.
As a business owner, working with a consolidated merchant account provides the convenience of working with a single point of contact who understands your billing cycles, goals and the nature of your business. This relationship provides advocacy for the success of your business and gives you more negotiating power when it comes to your contract and rates.
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