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IS IT BETTER TO LEASE,
BUY OR OPT FOR FREE CREDIT CARD
PROCESSING EQUIPMENT
This question is very
common. You need to find out whether it
is best for you and your business to
lease, buy or get the credit card
processing equipment for free.
Most of the business
owners consider obtaining one or more
merchant accounts for their business at
one point. The merchant account will
permit them to accept payments through
debit and credit cards from their
customers. To accept payments through
debit and credit cards the merchant must
get “credit card processing equipment”
and a merchant account.
The Processing Equipment
for credit cards, also referred to as
“Credit Card Terminals”, obtains the
credit card details by reading the data
that is embedded on the back side of the
credit card in a magnetic strip. Once
the terminal gets the details, it will
encrypt the information and send it to
the credit card processor who sends it
to the issuing bank to get
authorization. The transactions can be
submitted to the processor in a “batch”.
There are several types
of equipment available in several
different ways. Making the right choice
of processing equipment and at the
correct price is important as it will
have several financial impacts on you
and your business. For most of the small
and medium sized companies, a compressed
all-in-one processing solution such as
Hypercom T7 Plus will be the optimal
solution.
Several owners face the
problem of whether they should buy,
lease or take the free equipment
program. There are many direct and
indirect benefits and draw backs with
each method. Some solutions can be
bought for some hundred dollars. The
merchants will also get the software and
warranty from popular payment systems.
Such solutions should not be taken on
lease if you have the funds. Moreover,
you should be extremely careful when you
go for leases as they are not
cancellable until the contract ends. The
lease contracts extend till 36 months
costing you about $20 to $100 a month.
But, when the point of
sale systems is extremely costly then
“lease” is the best option for your
business. For example, the POS system
for a restaurant costs more than $5000.
In such cases, if you have just opened a
restaurant, then go for leased
equipments. The All – in – one
processing system and cash register will
cost you about $90 a month, if you take
it on lease. This is much more budget
friendly and affordable for small or
start up businesses.
Free terminal equipment
programs are great options provided you
read the agreement very carefully. For
all such programs, you must agree to
process your transactions with the same
company. In most cases, these programs
are given with one of the following:
high start-up fees, additional monthly
fees, high cancellation fees or high
processing rates. In some cases two or
all the conditions will apply.
Therefore, you need to read the fine
print very carefully before applying for
the free terminal programs or you will
loose more money than earn.
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