Learn how to choose the right merchant service provider, key factors to consider, and tips for successful negotiations and integration support.
Curious how to choose a merchant service provider? Learn key factors to consider when selecting the right merchant service provider for your business.
A great merchant services provider is secure, reliable, effective, and mostly silent. The best way to find the best merchant services provider for your business, is through a payment processing consultant like Swipesum. We help hundreds of merchants per month source the best solution, negotiate the lowest costs, and provide white glove integration and long-term support.
When you have an exceptional payment processor on your side, your workflow for processing relevant payment methods will work as intended. In this situation, you can count on your provider to do the necessary work behind the scenes to accept payments. There won’t be much, if any, extra work required of you or your team.
Unfortunately, not all merchant services providers live up to this standard. Errors related to transactions and the funds that come from them can cause serious problems for your business.
Even if a provider offers reliable service, their fees may be excessive. Finding a merchant services provider that offers effective support at a reasonable price is crucial for your business. Evaluating the merchant services cost is essential, especially for businesses that process a high volume of card payments.
Swipesum can help you do exactly that. Our independent payments consultants are experts in their field. They know how to find a payment processing system that meets your needs and negotiate the best possible rates. Schedule a free consultation to learn more.
A merchant services provider (MSP) is a company that facilitates the acceptance of payments for businesses, enabling them to process transactions via credit cards, debit cards, and other electronic payment methods. A merchant account provider plays a crucial role in setting up accounts that allow businesses to accept these electronic payments, often catering to individual account setups and offering strategic solutions tailored to various business needs. Essentially, an MSP acts as the intermediary between the business, the customer’s bank, and the payment networks, ensuring secure and efficient payment processing. These services typically include payment gateway integration, point-of-sale (POS) systems, and the management of transaction settlements.
Working with a merchant service provider offers numerous benefits for businesses of all sizes. Here are some key advantages:
By leveraging these benefits, businesses can enhance their payment processing capabilities, improve customer satisfaction, and drive growth.
When selecting a merchant service provider, it’s essential to assess your business needs to ensure you choose the right provider for your specific requirements. Here are some factors to consider:
By thoroughly assessing your business needs, you can choose a merchant service provider that aligns with your specific requirements and supports your business goals. This careful evaluation ensures you select a partner that enhances your payment processing capabilities and contributes to your overall success.
Choosing the right merchant services provider is a critical decision for any business, as it impacts your payment processing efficiency, costs, and customer experience. Evaluating merchant account services is essential to ensure you select a provider with transparent pricing, adaptable features, and industry-specific solutions. Here’s a step-by-step guide to help you select the best provider for your needs:
The most efficient way to choose a merchant services provider is to partner with a payments consultant like Swipesum. Unlike traditional merchant account providers that focus solely on setting up accounts for processing card payments, Swipesum provides expert advice tailored to your business. They can audit your current payment setup, negotiate lower fees, and match you with the best provider based on your unique needs, all while managing the implementation process for you.
Ensure the payment processor you choose integrates seamlessly with the software you already use for managing your business, such as eCommerce platforms (Shopify, WooCommerce), accounting tools (QuickBooks), or enterprise resource planning (ERP) systems (NetSuite). This integration simplifies operations, reducing the need for manual processes and ensuring that your payments sync with other business functions like inventory and financial reporting.
Understanding the fee structure is essential when selecting a merchant services provider. Look at the transaction fees, monthly fee, and any hidden costs like early termination fees or PCI compliance charges. Understanding these charges is crucial as the monthly fee can significantly impact overall expenses. Swipesum, for example, helps businesses identify the most cost-effective options by comparing various providers and negotiating on your behalf, ensuring that you’re not overpaying for services.
Security should be a top priority when choosing a merchant services provider. Look for providers that offer advanced security features, including encryption, tokenization, and fraud detection. Additionally, ensure that the provider is PCI DSS compliant to protect sensitive cardholder data. Working with a consultant like Swipesum can help you navigate compliance challenges while ensuring your payment infrastructure is secure.
Look for a provider that offers strong customer support and detailed reporting tools. Reliable support ensures that issues like downtime or transaction disputes are resolved quickly, minimizing disruptions to your business. Additionally, robust reporting features help you track sales, monitor fees, and analyze customer payment behavior. A provider that offers easy-to-understand analytics will allow you to make data-driven decisions to optimize your payment processing.
By following these steps, you can confidently select a merchant services provider that not only meets your current needs but also supports your business as it grows.
Merchant services providers handle the complex, behind-the-scenes aspects of payment processing, including credit card payments. When a customer makes a purchase using a credit or debit card, the MSP works to securely transmit the transaction details between the business and the acquiring bank, ensuring the payment is authorized. Once approved, the funds are transferred from the customer’s account to the merchant’s account, less any processing fees.
MSPs also offer services such as fraud detection, chargeback management, and compliance with regulations like PCI DSS (Payment Card Industry Data Security Standard). By taking on these critical tasks, MSPs enable businesses to focus on operations while ensuring they meet the necessary security and financial requirements.
When it comes to selecting a merchant services provider, businesses are often faced with a wide range of options, each offering various features, pricing models, and levels of support. Among the top providers, Swipesum, Elavon, Worldpay, and TSYS consistently stand out for their comprehensive services, industry reputation, and proven results in helping businesses process payments efficiently.
Swipesum has rapidly gained recognition as a leading payments consulting firm, particularly for businesses that need a tailored solution. Unlike traditional merchant service providers, Swipesum acts as an independent consultant, working with various processors to find the best fit for each business. Swipesum’s unique approach includes providing fee audits, negotiating on behalf of businesses, and offering a full suite of AI-driven tools to reduce payment processing costs.
What sets Swipesum apart is its hands-on service, especially in industries like retail and eCommerce, where transaction volume can vary significantly. They’ve been ranked #1 by Entrepreneur Magazine for merchant services, which reflects their growing prominence. The company’s revenue transparency model and project-based consulting approach make them an appealing choice for businesses seeking a true partnership, not just a service provider.
Elavon is consistently named one of the largest merchant service providers in the world. Backed by U.S. Bank, it supports over 1 million businesses globally, with a focus on high-volume industries such as retail, hospitality, and healthcare. According to a recent press release, Elavon processed over $450 billion in card transactions in 2023, a testament to its robust infrastructure and reliability.
One of Elavon’s strengths is its ability to offer integrated payment solutions that work across multiple platforms, making it easy for businesses to manage both online and offline payments. The company’s ability to integrate with industry-leading platforms like Shopify and NetSuite ensures flexibility and scalability for growing businesses. Their recently enhanced gateway, Fusebox, now allows even more secure, tokenized transactions, reducing the risk of fraud for clients.
Worldpay, part of FIS Global, is another major player in the merchant services industry. Known for processing a staggering 40 billion transactions annually, Worldpay serves businesses in nearly every sector, from retail to fintech. A 2024 report noted that Worldpay continues to be a preferred choice for large enterprises and global companies, thanks to its international reach and multi-currency processing capabilities.
Worldpay's strength lies in its technological innovation. The company has recently invested heavily in expanding its capabilities for real-time payments and cryptocurrency processing, both of which are critical for businesses looking to stay ahead of the payment trends. With a comprehensive suite of services that includes risk management and fraud protection, Worldpay is ideal for businesses seeking scalability and global reach.
TSYS, now part of Global Payments, is a longtime leader in the payment processing industry. With a focus on card issuer services as well as merchant services, TSYS brings a unique angle to the table. The company is known for its customized solutions, especially in the retail, restaurant, and healthcare sectors. TSYS processed $1.5 trillion in payments in 2023, showcasing its ability to handle massive transaction volumes with ease.
Recent developments from TSYS have emphasized integration with emerging payment technologies, including NFC and mobile wallet transactions. Their cutting-edge POS systems and mobile payment apps have made them a popular choice among businesses looking for seamless in-store and online transaction management.
Choosing the best merchant service provider depends on your specific business needs. For businesses seeking a customized, consultative approach, Swipesum stands out as a top choice. Elavon, with its global reach and powerful infrastructure, is perfect for large-scale operations. Worldpay is an excellent option for companies needing innovative, forward-thinking payment solutions. Finally, TSYS offers flexibility and cutting-edge technology, making it a strong choice for retailers and healthcare providers alike. By evaluating each provider's strengths and considering your business's unique needs, you can select the best partner to support your payment processing needs.
Service quality, software features, and your businesses needs are the top priority when finding a merchant services provider. Rates are always negotiable and you cen get them where they need to be, but features and functionality generally aren't. Find the ideal solution first, then leverage a payments expert to help with price matching and negotiating fees.
Merchant services providers aren't a one-size-fits-all solution. Yes, they all help you accept credit and debit cards (and, increasingly, various forms of electronic payments). However, they can vary significantly in terms of the tools, resources, services, and support they provide on the individual level.
A provider can offer exactly what one company needs, but come up short in terms of service and support for another. The size of your business, the industry you operate in, your customers' preferred payment methods, and more can all make a difference.
That's why it's so important to understand what your business needs from a merchant services provider. Start thinking about these factors to document your company's requirements. Then, you'll be in a better position to compare offerings from payment processing companies.
Starting with your POS system helps guide the rest of the decision-making process. Nearly every business with a brick-and-mortar location needs POS tools — terminals, software, and more.
Be sure to document your requirements. Do you need mobile card readers for transactions outside of a fixed location? How many terminals will you need if your storefront has more than one checkout line? Do you need to manage subscriptions and recurring purchases? What about ecommerce?
You have to provide fast and positive payment experiences for customers and make it easy for staff to accept and manage those payments. You can also benefit from analytics, reporting, and other options that are potentially available, depending on the provider.
A business bank account is essential for managing funds received from credit and debit card transactions, ensuring secure and efficient settlement of transactions.
That includes credit card processing. However, businesses need a broader range of payment services (digital wallets, Apple and Google Pay, etc.), to tap into modern customer preferences.
Your POS system and payment processor can be separate or combined. Closed systems, like Square, can seem convenient. However, they often come with additional fees. Additionally, a closed system will require you to switch POS hardware and software when moving to any new merchant services provider.
If you use an open system, then your POS connects to your merchant services provider through a payment gateway. That means your saved payment information is portable. Additionally, you can keep your current POS system and much more easily switch merchant services providers.
Every merchant services provider will use a somewhat different strategy for customer service. Do you need a direct line to support, or will self-service methods and online chats be enough? Do the support hours align with your company's own hours of operation?
Check out reviews from current and past customers and review the provider's own documentation. This can help you understand how the provider handles questions, concerns, and complaints.
Fees and costs can also vary greatly from one provider to another. A percentage charged per transaction is foundational, and a variety of other fees are the norm for many providers.
Flat rate, interchange plus, tiered pricing, and zero-percent markup with a recurring membership fee are all common. Learn more about these common merchant services pricing structures.
We recommend avoiding tiered pricing. It's especially opaque compared to other options, and very complex. Remember that a payments expert can help you negotiate prices and fees, making a preferred provider in terms of service more accessible for your business in terms of cost.
Once you find the merchant services provider with the best combination of tools, services, and support, you’ll need to fill out a merchant application.
When successful, this process ends with your business receiving a merchant account, explained in more detail here by Investopedia. Unlike a regular bank account, a merchant account is a specialized bank account essential for businesses to accept electronic payments. Funds from transactions are managed and deposited into the business’s primary bank account after settlement. You’ll also receive a Merchant Account ID number (MID). This is vital for efficiently and accurately moving money to and from your account.
The application itself requests relatively basic information. You will need to share details about your business in general and data about transaction volume. Supporting documents are needed as well.
When fully and accurately completed, the merchant application facilitates fast approval. You can have a new merchant account in as few as three days.
Swipesum empowers a seamless transition from your old provider to your new one. We make sure you understand the new setup and what to expect. We also provide access to all of the internal tools needed to process payments and view reporting easily and consistently.
At Swipesum we do all the research for you. You make the final decision, while our experts set it all up and integrate it for you. You can fully hand off complex payments workflows to payment professionals.
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Just call Swipesum, we help merchants solve this question daily. Often a reseller sold someone in your business on "Merchant Services" and the reporting statements have no contact or branding information making it difficult to know who your merchant services provider is.
Merchant service providers make money primarily by charging fees on each transaction processed, which can include a percentage of the sale and a flat rate per transaction. They may also charge businesses monthly service fees for payment gateway access, POS systems, and other value-added services. Some providers earn through leasing hardware, such as card readers or POS terminals, to merchants. Additionally, they may collect fees for ancillary services like chargeback management, PCI compliance, and fraud prevention.
A good merchant service rate typically includes both interchange fees and processing fees. Interchange fees, set by card networks like Visa and Mastercard, are paid to the card-issuing banks and generally range from 1.5% to 3.5% of the transaction amount. Processing fees, which go to the merchant services provider, are added on top of interchange fees and vary depending on the provider. On average, businesses in the U.S. pay around 2.87% in total transaction fees, according to recent industry data.
Some providers offer flat-rate pricing models, typically charging 2.6% to 2.9% per transaction, which can be easier to manage but might not always offer the lowest costs for higher-volume businesses. Swipesum, as a payments consultant, helps businesses save an average of 60% on processing fees by auditing their current setup, negotiating with providers, and ensuring they have the most cost-effective solutions in place. This makes a significant difference for businesses looking to cut costs and improve their bottom line.
Ready to learn more? Schedule a free consultation today!
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Michael Seaman
Michael Seaman is the co-founder and CEO of Swipesum. A veteran of the payments industry and former employee at one of the largest payments companies, Michael, along with his brother Stephen, has led Swipesum since its inception in 2016. Swipesum is committed to providing innovative payment solutions and exceptional service to its diverse clientele. In his free time, Michael enjoys traveling with his wife Kelsey and their three children, pole vaulting, and engaging in typical Midwestern dad activities.
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