Most consumers have at least a few major credit cards, often from different issuers like VISA, MasterCard and American Express. While credit cards operate in essentially the same way from a consumer’s point of view, they’re very different products from a business’s perspective. Credit card services often charge different rates for different major credit cards, as processing is handled in entirely different ways. Understanding a few of the major differences between issuers is helpful when choosing a credit card processing account and assessing the charges associated with taking different types of bank card payments from customers.
The biggest difference between major credit card companies like Visa and MasterCard is the charges that they assess for their services. Charges are always based on the number and size of the transactions that businesses submit, so smaller companies can be penalized with higher rates, but different credit card issuers use very different methods to set these rates. For most small businesses, the best option is to use a credit card processing company, as this allows for easier day-to-day processing, lower rates and advanced features like Internet payment processing. Credit card processing services can usually handle most major credit cards and deal with the security and processing protocols that the credit card services require, allowing businesses to focus on making more sales. The right credit card processing service can mean better productivity and easier debit and credit card handling for a business of any size.
Visa and MasterCard also use very different security protocols, right down to the security code on the back of their cards. While there are many similarities between the security protocols of these companies, the differences can mean big costs for credit card services. Processing companies have to have different procedures in place for dealing with different issuers, which is why most credit card processing companies only accept a few different major credit cards. Issuers like American Express are even more different, as American Express establishes individual accounts with businesses – they sometimes don’t work directly with credit card processing services, and American Express transactions can often be very expensive for businesses in some cases, particularly if the business handles few transactions through American Express on a monthly basis. This is one of the major reasons that many businesses restrict their services and products to Visa and MasterCard purchases.
Customers use a variety of major credit cards, so businesses should look for credit card services that have good rates for each major issuer. The right credit card processing service can provide great flexibility for a business, allowing customers to be handled efficiently with low per-transaction fees and other costs.