How to Tell When a Merchant is the Right Fit for Your Payment Solutions

Merchant service providers are invaluable financial intermediaries that process payments for businesses both online and in brick-and-mortar locations. For these providers, selecting the appropriate merchants for your payment services is an important strategic decision that can have a real impact on financial stability, operational efficiency, and customer satisfaction.

Major Considerations for Selecting the Ideal Merchants

The goal is not simply to foster collaboration with as many merchants as possible, but connect with the right businesses to create a mutually beneficial ecosystem for financial transactions.

Here are the specific considerations that payment processors and merchant service providers should take into account when choosing the right businesses for their solutions:

Addressing Payment Needs

Ultimately, one of the biggest considerations is whether your payment services and solutions are able to address their specific needs and operational requirements.

There is no one-size-fits-all approach. You’ll need to take stock of all your payment solutions to identify which businesses can best benefit from partnering with you.

Merchants are often seeking to work with service providers that can process a range of payments, ensure safe and secure transactions, and offer a variety of customizable hardware and software options.

They’re also partial to a payment partner that can provide attentive service and communication when needed to help navigate system integration, onboarding, tech support, and more.

Understanding their needs and how they’re compatible with your solutions will help decide if a company is a good fit.

Processing Volume

One factor that service providers often assess is the amount of transactions that a company will regularly process, which can include sales volume, and average transaction size, among others. This is used to calculate their processing fee rate, as well as determine a business’ growth potential.

Companies with high transaction volumes are often preferred as they contribute more to the provider's revenue stream. Additionally, processors seek partnerships with businesses that are likely to increase their transaction volume over time.

Industry Regulations & Compliance

Depending on a merchant’s industry or location, a payment provider may need to adhere to several different regulations to avoid legal and financial repercussions.

Some of the most common compliance standards include the Payment Card Industry Data Security Standard (PCI DSS) for businesses handling cardholder data, the Know Your Customer (KYC) policy to verify a customer’s data and identity, and the Anti-Money Laundering (AML) rule which aims to detect suspicious activity and financial fraud.

With that in mind, payment processors look for signs that a business has robust fraud prevention measures in place. Without such policies, businesses can pose a higher risk to the provider.

For merchants that operate internationally or in certain high-risk industries, service providers will have to familiarize themselves with applicable payment processing laws and regulations before establishing a partnership.

Chargeback History

Chargebacks occur when customers dispute a transaction, and they can be a significant headache for payment processors. That’s why they closely examine a company’s chargeback history to assess the risk of future disputes. A record of excessive chargebacks can be a red flag, as it indicates potential issues with customer satisfaction or product quality.

Payment processors may inquire about their strategies for managing and reducing chargebacks. While a low chargeback rate is ideal, having a plan in place to handle disputes and minimize their occurrence can make a merchant more attractive.

Typically an in-depth evaluation of these factors takes place during the underwriting process. This is when a payment processor performs a detailed analysis of the applicant's financial health, creditworthiness, and other relevant measurements to determine whether to approve or deny their application and if approved, on what terms and conditions.

By carefully considering these factors, payment processors and merchant service providers can minimize risk, ensure compliance, and build lasting, successful partnerships.

Become a Sales Agent With OnCore

If you’re looking to take charge of your financial future while elevating your sales career, join OnCore Payment Technologies’ nationwide network of sales agents.

As an OnCore sales agent you’ll gain access to a range of advanced payment technology, exclusive career benefits, and a level of personalized service you won’t find at any other large firms.

OnCore offers a suite of proprietary payment products tailored to suit businesses of all sizes and industries, including cutting-edge point-of-sale (POS) systems, payment terminals, secure payment gateways, and customizable solutions, all designed to seamlessly integrate with a merchant’s existing systems.

Agents can access a range of competitive benefits, including a lucrative commission structure, lifetime residuals, and portfolio ownership. Agents also have 24/7 access to our dedicated in-house support staff and service teams to provide ongoing assistance whenever you need it.

Enjoy the independence and flexibility to excel in the industry on your own terms.

Contact OnCore today to find out more or to join our team.