Man holding tablet pc and credit card indoor, Shopping online“Do you accept credit cards?”  If you’re a business owner you probably hear this question again and again.  If you’re starting a new business, or thinking about it, get ready.  You’ll need to have the right answer.  The alternative can be costly.

Isn’t credit card processing expensive?

There are, of course, fees involved with credit card processing.  These fees are a tax-deductible (consult your tax advisor) cost of doing business like your rent or electric bill.  Now, you could certainly save money by turning off your lights.  However, the negative effect on your business would likely outweigh any savings.

The same is true for credit cards.  Many potential customers will choose to do business with someone else if their favorite payment method isn’t accepted.  I don’t know about you, but I’m surprised and sometimes even a bit suspicious when someone says, “Sorry, cash only.”

But do you think cash and checks are cheaper?  Think again.  Cash is a serious issue that businesses need to plan for and deal with.  It must be securely stored and guarded.  It must be accounted for, at least daily, and probably multiple times per day.  It must be securely transported to the bank.  These things cost your business money.  Don’t forget about theft.  That’s really expensive. Bounced checks?  Don’t get me started.

Expensive?  Not really, especially when you consider the true costs of the alternatives including the cost of losing customers.  And besides, processing costs should be included as a cost of doing business and included in your retail pricing strategy.

Card acceptance lends your business credibility. 

There’s nothing like having those card logos displayed on your front door, or on your truck, brochure, website, or business card.  It says, “I’m open for business, I’m for real, and most importantly, you, and your chosen method of payment are welcome here”.  It’s convenient.  Overall sales volume increases and individual sales (average ticket) sizes increase with card acceptance.  It’s faster than cash and way faster than checks.  Many people carry very little cash these days anyway.  I know, I’m one of them.  Plus, there are many other valid reasons your customers want to pay with a card: points or miles, refund security, stretching out payments, etc.

But it’s really complicated!

It doesn’t need to be.  Sure, I’ve seen some processing statements that are very nearly indecipherable.  This, in my opinion, is either a poor business practice or an intentional attempt to obfuscate.  Your processor should have easy to read statements and have customer service reps that are adept at explaining them to you.

Behind the scenes, the payments industry, made up of banks and multiple processing entities, is actually very complex.  Your own payments processor should shield you from this complexity.  Your fee structure should be understandable to you.  If your sales rep can’t make it simple, or at least clear, keep shopping.

Do you have any topics you’d like to see covered? In this series I’ll be addressing a multitude of payment processing topics.  If you have a particular subject you like me to report on, please let me know.  And if you have a specific question you’d like answered, just reach out!  I’d love to hear from you. Reach me at 888-608-0003,, or   

Michael Darrow is a 22 year veteran of the payments processing industry.  He is an independent agent for Ignite Payments, part of the First Data family of companies.  Michael has helped thousands of businesses with their payments needs over the years.  He has interviewed and consulted for clients in nearly every imaginable industry, and business sizes ranging from mom-and-pop startups to Fortune 500 multinationals and everything in between.

His interests include bicycling, swimming, walking and hiking, but Michael especially likes to spend time with Mary, his wife of 24 years, Adrian, their 11 year-old son, and Kiki their 13 year-old cat.