Assume your business has a “No Exchanges” or “No Refunds” policy.  If you place such restrictions on sales than it is important that you disclose this policy on your Sales Drafts with the words “No Exchanges” or “No Refunds.” 

If you have not yet applied for your merchant account, be sure to let us know when you apply what terms you would like disclosed on your Sales Drafts.  We will make sure your account is setup to disclose your terms of sale on your Sales Drafts.  

If you already have a processing account setup with Best Merchant Rates and would like to add terms of sale to your Sales Drafts, then call our Customer Service Department and we are happy to have your terms added.    As a reminder, Best Merchant Rates has a dedicated in house Customer Service Department available from 8:00am – 5:00pm Pacific Time every weekday.

Also remember that if a refund needs to be given to a customer who paid with a Debit or Credit Card, then the funds must be returned with the same form of payment with which they were received.    Avoid giving cash, check or in-store credit for a refund when the original purchase was made with a Debit or Credit Card.

I love it when we hire a new employee. Why? There are two reasons why I love it. One, they are testing the process and procedures that we have in place and two, they have fresh new ideas. Some come to the table not really knowing too much about the credit card processing industry which means random questions come up from time to time.

So the new employee came in and asked me, “What is the difference between online debit and offline debit?” Answer — The difference is whether a PIN (personal identification number) is used at the time of sale. When a PIN is used the debit transaction becomes “online” and the funds are immediately withdrawn from the customer’s checking account. If the customer were to log onto their banking account, they should see the sale amount “pending.” When an offline debit transaction occurs, funds are not withdrawn for approximately 2-4 days (usually when the transaction process).

I welcome these random questions. They break up my day from the reporting I have to conduct. Besides, it’s like a pop quiz but this time, I’ve studied and I know the content. Gosh, does that have credit card processing NERD written all over it or what?

“Where is my money?”  That’s what I heard on the phone the yesterday.  “Where is my money? I had ten sales this week and I don’t see any money in my bank account?”  I kindly asked the merchant, “Did you batch out your terminal? Have you settled the terminal?”  Once I asked those questions, the merchant changed their tone immediately.  We get a handful of these types of calls every month from new business owners.  

To those of you who are new to the payment processing industry, batching or settling your credit card machine or terminal means you are sending your “completed” transactions to the acquiring bank for payment. Two parts comprise a credit card transaction – an authorization and a settlement. Both functions must be performed in order to complete the transaction and receive the funds in their assigned bank account. 

If you are a standard retail store, you may request to get your terminal set up for auto-batch. Auto-batching is when the terminal automatically settles at a specific time each day; it will preform the function for you so you will never forget.  Now, if you own a restaurant, nail or hair salon or any business that receives tips for service, we do not recommend the auto-batch feature. And that’s because if for some reason you forget to adjust your tips at the end of the day, you will lose all the tips and just get paid out on the sale.

Assume you have purchased a product from your own business and think it would be most convenient to pay for the product by swiping your own credit or debit card.  As harmless as this may initially sound, your personal credit or debit card should never be processed through your merchant account. 

As with any transaction, swiping your own Visa or MasterCard will result in funds being deposited into your business bank account .  And if you are the owner of the credit card that was swiped as well as the owner of the merchant account than you have essentially given yourself a cash advance.  And merchant accounts are not intended to be used as ATM machines.

The bank does regularly monitor the names on credit cards that are processed through a merchant account.  Play it safe and make sure you do not swipe your own credit or debit card.

When the topic of credit card processing comes up, people who are foreign to the industry usually ask “…so how does all that work?” Although it is seamless to the consumer (which is exactly the point), there are quite a few steps that need to take place to make sure that funds are transferred correctly. First and foremost, the place of business needs to be set up with a terminal and a credit processing partner. If you are a place of business researching this service, make sure you research credit processing companies out there. Do your homework and choose a reputable company that is going to be your partner and not just your processor. Once this has been established and you are up and running, the following happens before a transaction is complete.
1. Your customer provides you with their credit card or debit card to pay for their merchandise or service. You swipe their card. All credit cards or debit cards have a magnetic stripe on the back of the card which is passed through a terminal OR you manually enter the 16 or 15 digits (depending on the type of card being used). The terminal therefore “reads” the information on the card and the pertinent information is then entered into the processor’s network.
2. As you enter the expiration date and possibly the CVV code and/or the customer’s zip code, you are generating a request for authorization.
3. Your processor will communicate with Visa or MasterCard in order to transmit the authorization request to the issuing bank’s network.
4. A process takes place in which the information entered during the swipe or manual entries are verified. The issuing bank also makes sure that there are sufficient funds in the customer’s account in order to complete the transaction.
5. The customer will see a difference in their balance and their “available” balance. Transactions of this nature take a day or two to fully fund. Therefore it is typical for a consumer to see a difference in their daily balance and fund availability. This is due to “unposted” transactions that are pending on their account. The money hasn’t technically been collected from their account, but it is also no longer available to them because of the pending transaction.
6. Once the transaction has posted the customer’s account, the merchant will see a deposit into their account usually within the same business day.
Since these steps are crucial to making sure that funds are correctly transferred from the consumer’s account to the merchant’s account, it is imperative that the merchant work with a reputable processor. Again, take the time to do the research and select the best company who will take care of your needs, who will provide the customer support in case of any questions, and who will provide you with the best possible rates.