3 Reasons to NEVER Lease a Credit Card Machine

3 Reasons to NEVER Lease a Credit Card Machine

Dejavoo with credit card-small

Although leasing terminals has declined in recent years, some sales reps will try to convince you that leasing is the right option for you. They’ll tell you a bunch of great things like, “you’re not required to pay any money up front,” or “you’re guaranteed a replacement terminal if yours breaks,” or “you’ll be eligible for new terminals when there are new features”.

Don’t fall for it!!!

  1. Leasing a terminal will end up costing you hundreds, if not thousands of dollars, including the fees associated with the lease. You could purchase that same machine in a matter of months… if not immediately.
  2. You may be required to purchase equipment insurance, which is another added cost.
  3. You have to sign a 4-year contract for processing services with that provider while you have the 48-month equipment lease. And, not to mention, you may even have to return the equipment at the end of your lease.

Why Purchasing a Credit Card Terminal is Your Best Choice

Typically, terminal leases carry 48-month lease agreement with a monthly payment between $50-$100/month. That is a LONG time to be paying for a machine that doesn’t cost more than $300 these days. Why not just purchase one outright?  Most startups can’t afford to pay $300 for a new machine so ask your processor if they will work with you and spread the payments over a 3-4-month period. Simply Credit Card Processing will work with you to spread those payments over a 2-4 month time period because we know what it’s like to start a new business from the ground up.

The cost of the purchase is completely tax deductible, and you won’t get stuck paying $2400 for a machine that costs $400. That’s 600% in interest over the course of four years. Yowzaa!

The “Free” Credit Card Machine

Some processors offer up “free” terminals to their merchants, but as we all know, there is nothing free in this world. Generally, a free terminal carries with it a yearly “Terminal Replacement” or “Warranty” charge of anywhere between $50-$100/year. That’s still much less than what a lease would cost you.

If you really can’t buy one, see if your processor will give you one for “free.” Alternatively, some processors will spread the payment over 2-4 months and if they won’t, call us.  We certainly will! Email us today: info@simplyccp.com

To Summarize…

If you’re already locked into a lease, you most likely won’t able to break the contract. A lease term is usually 48 months, so you’ll have to find out when that term ends before you can walk away without a penalty.

If you’re not currently in a lease, but are considering one, don’t be deceived by exaggerated claims from sales reps. Instead, do your own homework and calculate the total cost of leasing vs. owning. I’m sure you’ll find that the best and most affordable option lies in ownership.

Simply Credit Card Processing, LLC
www.simplyccp.com

Increasing fees

Why it seems like rates are increasing each month

Increasing fees

Why does it seem rates are increasing each month?

For one, you may be selling more this month than prior months.  That’s the easy answer, but did you know Visa and MasterCard increase rates twice a year in April and October?  In addition, the card ‘type’ your customer uses is what drives the rate.  For instance, a US Visa debit card that is swiped will have the lowest interchange rate but if that same card is key-entered into your terminal or gateway, the fees will be slightly higher.  Not having the card in hand increases the risk, therefore increases the rate.  One of the highest interchange rates is the business or corporate card or a rewards card.  As the merchant or business owner, you can’t control what type of card your customer uses and unfortunately, you take the hit by paying higher interchange fees so your customers can reap the rewards of those airline miles or other rewards.

Excerpt from Forbes, February 11, 2016 “Who Pays For Your Credit Card Rewards”: all major U.S. banks issue credit cards that offer some form of rewards – whether it be points, miles, or cash back. The reward space is extremely competitive, as consumers become increasingly aware of benefits like award travel. The idea of earning rewards has penetrated the mentality of shopping for credit cards. After surveying credit card users, we found that nearly 32% consider rewards and bonuses to be the most important factor in evaluating a card offer – above other aspects such as annual fees, interest, or brand.

So what can you do to help keep your rates low or consistent?   Have a rate review with your current processor every 6 months.   Or, contact us.  We can analyze your statement for free and show you the hidden fees, if any. We simplify the process and the fees for you.  Email: info@simplyccp.com or call us at 631-392-8169.

 

What are Non-Compliance fees?

non-compliance

 

 

PCI “Non-compliance” Fees
The non-compliance PCI fee is assessed to your merchant account and provides no value except to collect extra revenue for your processor.

It is a monthly fee for not being compliant with the PCI DSS standards. The fee usually ranges from $9.99 to $39.95,

This type of PCI fee can easily be removed by becoming compliant. Simply call your processor and they can walk you through the steps.  In most cases, it’s just about filling out a form online with a PCI Company like Trustwave or Control Scan or some other Compliance company.  You will log into their portal, complete the information based on the type of processing you have (terminal or e-commerce).  This process should take anywhere between 20 minutes to an hour.  There is also a toll free number for the PCI Company if you run into issues.  If you continue to receive a non-compliance fees even after you’ve completed this questionnaire online and met the requirements, then it’s time to switch to a new processor.

Feel free to call us at 631-392-8169 or email us at info@simplyccp.com.   Visit our website for more information about PCI Compliance.

Basics of PCI Security

PCI Security Standards

PCI and the Data Security Standards (DSS), establish protocols for protection of cardholder data,  mandating how card numbers and expiration dates must be protected. This is known as PCI Security.

The Basics of PCI Compliance and Validation Regulations

These regulations apply to financial institutions, Internet vendors and all e-commerce and retail merchants. The rules spell out what security measures must be taken to protect the private information of employers and employees during any transactions occurring with the use of a credit/debit card. They also require certain auditing procedures. The Payment Card Industry Data Security Standard (PCI DSS) is used by all card brands to assure the security of the data gathered while an employee is making a transaction at a bank or participating vendor.

There are six categories of PCI compliance security standards.

PCI Data Security Standards Council
Build and Maintain a Secure Network
  1. Install and maintain a firewall configuration to protect cardholder data
  2. Do not use vendor-supplied defaults for system passwords and other security parameters
Protect Cardholder Data
  1. Protect stored cardholder data
  2. Encrypt transmission of cardholder data and sensitive information across open, public networks
Maintain a Vulnerability Management Program
  1. Protect all systems against malware and regularly update anti-virus software or programs
  2. Develop and maintain secure systems and applications
Implement Strong Access Control Measures
  1. Restrict access to data by business need-to-know
  2. Identify and authenticate access to system components
  3. Restrict physical access to cardholder data
Regularly Monitor and Test Networks
  1. Track and monitor all access to network resources and cardholder data
  2. Regularly test security systems and processes
Maintain an Information Security Policy
  1. Maintain a policy that addresses information security for all personnel

Source:  PCI Security Standards Council
If you need help, call or email us now.