When I first opened the merchant account for Moments of Elegance, I was a total newbie to the world of merchant processing, I knew nothing and therefore pretty much just trusted what the company was telling me, and what I was doing. I also suffer from an occasional “I hate paying attention to details” syndrome, so every month when my merchant statements came in I wouldn’t even look though them, just put them on my mile high pile of “to be filed” (wow, that was quite a rhyme there).

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BIG MISTAKE. What I didn’t realize at the time as my husband and were manually processing our credit card charges (can you say “another DUH”), was that we figured out if we didn’t type in the credit card owners address into the system, it would take half the time to process the orders. So for about 9 months we were processing transactions only using the name and amount. Combine that with not taking the time to look at our statements. I am sure no one out there was as dumb as I was and is sitting there thinking “Wow, how did this girl get her business off the ground if she didn’t figure out that was a bad idea”. What can I say, I was engrossed in my SEO campaign and taking care of a newborn. Call it “new mommy brain”, who knows.

What I’m sure you’ve all figured out, is that by not processing the orders with the customers billing address, the credit card company put all of those transactions into a higher risk pool, as they assumed we hadn’t bothered to capture the billing address and therefore were not able to perform an AVS check on it. How did it affect us? 9 months worth of charges billed at the high risk rate of 4.2% instead of our “standard” rate of 2.3% – resulting in close to $2000 worth of higher charges because of the higher rate. Yeah, that was not a fun day when I realized that.

But what doesn’t kill us makes us stronger, right? Since then I’m a merchant account WARRIOR!! First I made sure I was using my cart to automatically process all payments (duh, I could write an entire “learn from my mistake” article just on that), and I send the credit card processor every possible detail that I can about the transaction, giving it the best chance to fall into the “qualified” (and therefore lowest) rate. I check my statements quarterly and always pay attention to changes in my statements and rates. When you sign up for your merchant accounts many will only “advertise” or talk about the qualified rate. If you do the right things that will hopefully be the rate for 90% of your transactions. But rates for reward type credit cards, out of country credit cards, and various other transactions will automatically fall into higher rate categories so make sure you know what those rates are, and when a transaction will fall into those categories instead of the usual qualified rate.

I also have a great processor that is a very ethical company and not into the rate and “pull the wool over your eyes” game that so many of the slick salesmen at other merchant accounts will hit you wtih. Check out my merchant processor if interested.

I am now a much wiser merchant, and hoping that this lesson (as obvious as it may seem), may be of some help to at least 1 or 2 of you. The rest of you, please try to contain the laughing and finger pointing, lesson learned.

Ashley R.

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