Lucid Payments

How Can Tradespeople Benefit From Mobile Payment Solutions?

Tradespeople can benefit from mobile payment solutions because they make it easier to accept payments wherever work is being done.

Instead of asking customers to call in their credit card number or wait for an invoice, a mobile payment terminal allows them to pay on-site when the job is complete.

This can create a more convenient payment experience for customers, help tradespeople get paid faster, reduce the need to follow up, and support a more professional payment process.

Key Takeaways:

Getting paid at the job site can help improve cash flow and reduce follow-up.

Customers may find in-person payments more convenient than calling in their card number.

Mobile payment terminals allow tradespeople to accept debit and credit card payments on-site.

Mobile and virtual payment terminals can give trades businesses more flexible ways to accept payments.

Card-present transactions typically cost less than card-not-present transactions, which makes mobile payments much more affordable.

For many tradespeople, the job doesn’t end when the work is finished.

A plumber can complete an emergency repair at a customer’s home, a contractor can wrap up a renovation, and a roofer can finish an inspection or collect a deposit before work begins.

In each case, the customer is ready to pay, but the payment process can still create friction.

Maybe the customer has to call an office with their credit card number. Maybe they have to wait for an invoice. Maybe someone has to follow up later. Or maybe the business has to manually enter the payment details after the fact.

These extra steps may not seem like big issues, but over time, they can create consequences.

For one thing, they affect the experience you provide for your customers, and they can also affect things like processing costs, when you get paid, and how difficult it is to collect what you’re owed.

And this is where mobile payment solutions for tradespeople can make a real difference.

For tradespeople who work in the field, mobile payment terminals and virtual payment terminals can help make payment easier, faster, and more professional.

What’s more, they offer added flexibility in terms of how they accept payments, while giving customers a more convenient way of paying when the work is complete.

Why Payment Flexibility Matters for Tradespeople

Tradespeople don’t usually work from one fixed checkout counter.

People like plumbers, electricians, contractors, roofers, and painters often accept payments in homes, at commercial properties, on job sites, in vehicles, or even through an office after the work is done.

And ideally, their payment setup needs to match the way their business actually operates.

If your team is completing work at different locations, collecting deposits, taking progress payments, or accepting payment after a service call is complete, you need a payment process that can move with your business.

Because when payment options are limited, the process can become much more complicated than it needs to be.

Customers may have to call in their card information, wait for an invoice, send an e-transfer, or remember to pay later.

And that can create delays for business owners and inconveniences for customers.

But the right mobile payment setup helps close that gap.

What Are Mobile Payment Solutions?

Mobile payment solutions allow businesses to accept payments outside of a traditional storefront or office.

This can include the use of things like mobile payment terminals and virtual payment terminals.

A mobile payment terminal is a handheld device that allows customers to pay in person using a debit or credit card.

A virtual payment terminal, on the other hand, is a secure, web-based software application that can turn any internet-connected device (like a computer, tablet, or smartphone) into a mobile payment terminal.

And both of these options are particularly useful for accepting payments on the job site, or at a client’s home, without having to chase people around for payment later.

In any case, the main points to be made here are that tradespeople shouldn’t have to force every customer through the same payment process, and your payment setup should support the way your business works.

How Tradespeople Can Benefit From Mobile Payment Solutions

Payment processing isn’t just about accepting card payments.

For tradespeople, the way you process payments can affect customer experience, cash flow, administration, processing costs, and how professional your business appears.

All things considered, a smoother payment process can help reduce friction at one of the most important points in the customer relationship: the moment when they’re ready to pay.

With that in mind, let’s look at some of the key benefits of mobile payment solutions for tradespeople.

Mobile Terminals Make Payment More Convenient for Customers

Most customers want payment to be simple.

When the work is complete, they may not want to call an office, read out a credit card number over the phone, wait for a payment link, or remember to deal with an invoice later.

More likely, they’ll simply want to pay and move on with their day, and a mobile payment terminal allows them to do that.

Instead of adding extra steps, the tradesperson can accept payment on-site, and the customer can use their card in a way that feels familiar, whether that means tapping, inserting, or swiping.

This can be especially useful for service calls, repair work, emergency jobs, maintenance visits, inspections, and smaller projects where the customer expects to pay once the work is finished.

At any rate, the easier you make it for customers to pay, the less friction you’ll have to deal with once the job is done.

In-Person Payments Feel More Secure Than Calling In a Card Number

Many customers are cautious about sharing credit card information over the phone.

They might not know who’s taking the information, where it’s being written down, how it’s being entered, or whether the details are being handled securely.

Even if your business has proper procedures in place, the customer may still feel uncomfortable.

But a mobile or virtual terminal that allows customers to pay in person can help reduce that concern.

When customers pay directly through a terminal, they keep control of their card. They’re not reading the card number aloud, leaving it on a voicemail, or trusting someone else to enter the details later.

And this can make the payment experience feel much more secure and more professional.

It also helps you avoid awkward payment conversations, because instead of asking the customer to call a number or provide card details after the fact, the payment can happen naturally once the job is complete.

All things considered, for tradespeople who want to build trust, these small moments matter.

A customer may not know much about payment processing, but they do notice when a business makes the process easy, organized, and respectful of their comfort and privacy.

Calling In Payments Can Cost More in Processing Fees

Another important reason to avoid unnecessary call-in payments is that they tend to cost more to process.

When a customer calls in a credit card number, that transaction is considered card-not-present, which means the card is not physically present at the time of payment.

Card-not-present transactions are generally more expensive for business owners because they carry higher fraud and chargeback risks and are therefore associated with higher interchange fees.

And for tradespeople, that difference can matter over time, especially if many customers are calling in their card details after the job is done.

So, if your business regularly has customers call in card numbers after the job, you may be creating a less convenient process for the customer and potentially paying more for each transaction.

A mobile payment terminal can help turn many of those payments into card-present transactions, where the customer is using the card in person at the time of payment.

Of course, there may still be times when remote payment options make sense, but the point is to understand the difference and choose the right method for the situation, instead of relying on call-in payments as the default.

Getting Paid On-Site Can Improve Cash Flow

Late payments can create unnecessary stress for tradespeople.

If your team completes the work but payment doesn’t come until days or weeks later, that delay can affect your cash flow, and it can also create more follow-up work after the work is done.

In these situations, someone has to send the invoice, track whether it has been paid, follow up with the customer, reconcile the payment, and possibly chase overdue amounts.

But mobile payment terminals can help reduce that delay.

When payment can be collected on-site, you have a much better chance of getting paid when the work is complete.

However, this doesn’t mean every job will be paid for immediately.

Larger projects may still involve deposits, progress payments, holdbacks, or other billing arrangements. But for the types of jobs where immediate payment makes sense, a mobile terminal can make the process much smoother.

Mobile Payments Can Make Your Business Look More Professional

Customers judge your business by more than the work itself.

They also notice how your business communicates, how appointments are handled, how paperwork is managed, and how easy it is to pay.

As a result, having a mobile payment terminal can make your business look more organized and prepared.

And instead of telling the customer they need to call your office, wait for an invoice, or provide payment information later, you can offer a simple payment option on-site.

For established trades businesses, this can support a more professional reputation, and it can also help create consistency when multiple technicians, crews, or team members are collecting payment in the field.

Mobile Terminals Can Reduce Administrative Work

A complicated payment process can create extra work for everyone.

If customers have to call in their credit card number, someone has to answer the call or return the message. If invoices are sent later, someone has to track them. And if payments are entered manually, there is more room for mistakes.

Luckily, mobile payment solutions can help reduce some of that administrative burden.

Because when payments are accepted on-site, typically there will be fewer follow-up calls, fewer unpaid invoices, fewer manual entries, and fewer delays between the completed work and the completed transaction.

Moreover, if crews or technicians can accept payment directly, then you won’t have to spend as much time chasing information, matching payments, or reminding customers to pay.

The right mobile payment setup should make it easier for customers to pay, and easier for you to collect what you’re owed.

If you’ve been following payment industry news in Canada, you’ve probably heard the term real-time rail more than once.

It’s often mentioned as a major modernization of the Canadian banking system, and something that will make payments instant, available 24/7, and more efficient for businesses.

But what exactly is real-time rail? When is it actually coming to Canada? And why has it been delayed so many times?

More importantly, what does all of this mean for Canadian business owners?

In this article, we’ll break down what real-time rail is, how it’s expected to change the Canadian payments landscape, how it could benefit businesses, and why the timeline has shifted repeatedly.

What Is Real-Time Rail?

At its simplest, real-time rail (also known as RTR) is Canada’s upcoming instant payment system.

It’s being developed to allow money to move directly from one bank account to another in seconds – with immediate clearing and settlement – 24 hours a day, seven days a week, 365 days a year.

A Simple Definition

Real-time rail is a new payments infrastructure designed to enable:

Instant payment processing

Immediate settlement of funds

Enhanced payment data capabilities

Continuous availability (including evenings, weekends, and holidays)

And unlike traditional electronic funds transfers (EFTs), which are processed in batches at scheduled intervals, real-time rail is designed to process transactions individually and instantly.

How Real-Time Rail Works

Under the current system in Canada, many electronic payments are processed in batches, which means transactions are grouped together and cleared at specific times during business hours.

And that means that even if a payment is initiated today, it may not officially settle until later – sometimes the next business day or longer.

But real-time rail will change that model. Here’s how it’s designed to work:

A payment is initiated.

The system verifies available funds instantly.

The transaction is cleared and settled in real time.

The recipient receives funds within seconds.

The key difference from how things work now is that both clearing and settlement will happen immediately, rather than being delayed.

How Is Real-Time Rail Different From E-Transfers?

Many people assume we already have instant payments because of the existence of e-transfers.

But while e-transfers might feel fast, the truth is they’re not the same as a fully integrated real-time rail infrastructure.

Real-time rail is a broader system-level upgrade to Canada’s payments framework, designed to support larger volumes, richer data, business-to-business payments, and deeper integration with financial institutions and financial technology platforms.

Who Is Building Canada’s RTR Infrastructure?

The development of real-time rail is being led by Payments Canada, the organization responsible for operating Canada’s core payment clearing and settlement systems.

This is not a small upgrade, and it represents a fundamental modernization of Canada’s financial infrastructure.

What’s more, once it’s in place, major banks, credit unions, financial technology providers, and payment processors will have to integrate their systems with this new framework.

And because real-time rail touches the core of Canada’s banking system, the development process is complex, highly regulated, and heavily scrutinized for security and stability.

How Real-Time Rail Will Change the Canadian Banking System

If it’s successfully implemented, real-time rail will modernize how money moves across Canada.

So, let’s explore some of the ways it may be able to do that.

Moving From Batch Processing to Instant Settlement

Today, many payments rely on batch processing systems. This model has existed for decades and works reliably, but it was not built for real-time commerce.

With real-time rail:

Funds will move instantly.

Settlement will be immediate.

Payments will no longer wait for clearing windows.

This shift from scheduled settlement to continuous settlement represents a significant structural change.

24/7 Banking Infrastructure

Under the current system, many payment processes depend on banking hours or business days.

But real-time rail is designed to operate continuously, and that means:

Holiday delays would be eliminated.

Weekend payments would settle instantly.

After-hours transactions would be cleared immediately.

For businesses, this could remove the friction of waiting for Monday morning deposits or next-day settlement.

Increased Competition and Innovation

A modern real-time rail infrastructure may also encourage innovation in Canada’s financial sector.

Because the system is designed to support richer data and API integration, it may enable:

Smarter invoicing tools

Automated reconciliation

Embedded payment experiences

More seamless B2B payment workflows

Canada has historically lagged behind countries like the U.K. and Australia in real-time payment adoption, and real-time rail is intended to close that gap.

How RTR Is Supposed to Benefit Canadian Business Owners

From a business perspective, the appeal of real-time rail centres on speed, efficiency, and control.

So, let’s explore some of the proposed benefits of RTR for Canadian business owners.

Faster Access to Funds

Cash flow is critical for businesses of all sizes. And under the current model, even electronic payments can involve waiting periods.

But with real-time rail:

Working capital cycles could improve.

Funds would be available within seconds.

Businesses may rely less on short-term financing.

For industries where margins are tight or projects are large – such as construction or the trades – faster settlement could significantly improve your cash flow.

Potential Cost Efficiency

Real-time rail may create alternatives for certain types of payments, particularly in business-to-business transactions.

While it will not eliminate card networks, it could offer a lower-cost method for:

Invoice payments

Larger B2B settlements

Recurring account transfers

Having said that, cost impacts will depend on how financial institutions structure their fees.

Greater Payment Finality

Another potential benefit of real-time rail is finality.

Because under this system, once a transaction settles, it’s considered complete.

For business owners, that may reduce:

Reversal uncertainty

Extended clearing risk

Administrative disputes

At any rate, this kind of immediate settlement will provide business owners with more confidence in terms of cash flow forecasting.

Improved Customer Experience

Customers increasingly expect speed in all transactions, and real-time rail could enhance the experience by:

Confirming payments instantly

Reducing delays in order processing

Supporting seamless digital checkout experiences

And for service providers and online merchants, this may also improve the efficiency of their operations.

When Is Real-Time Rail Coming to Canada?

This is the burning question many business owners have been asking.

Unfortunately, the answer is: It’s been coming for years – but it’s been delayed multiple times.

Real-time rail was initially projected to launch several years ago as part of a broader modernization initiative, and initial expectations suggested a much earlier rollout.

However, large-scale financial infrastructure projects often face complexity beyond initial estimates.

Why Has Real-Time Rail Been Delayed in Canada?

If you’ve been hearing about real-time rail for several years, you’re not imagining things.

The project has faced multiple timeline shifts, and that has led to confusion and skepticism among business owners.

It’s natural to wonder: If other countries have already launched real-time payment systems, why is Canada still waiting?

The reality is that implementing a nationwide instant payment infrastructure is not a simple software update.

It involves rebuilding foundational components of Canada’s financial system, which processes trillions of dollars annually and connect banks, credit unions, financial technology platforms, and payment processors across the country.

Below are the primary factors that have contributed to these continued delays.

1) Technical Complexity

Real-time rail is not a surface-level upgrade. It requires rebuilding core clearing and settlement systems that connect all major financial institutions in Canada.

2) Security and Fraud Prevention

Instant payments introduce higher risks for fraud because once funds are transferred and settled in real time, reversing fraudulent transactions becomes much more difficult.

As a result, ensuring robust fraud detection and security controls is essential before launch.

3) Coordination Across Institutions

All participating banks and financial institutions must integrate their systems once real-time rail is rolled out, and that kind of coordination is complex and time-consuming, to say the least.

4) Regulatory and Compliance Oversight

Because real-time rail impacts the national financial infrastructure, the regulatory compliance and oversight requirements are quite significant.

5) Testing and System Resilience

Before launch, the system must undergo extensive testing to ensure reliability, uptime, and resilience against cyber threats.

And considering these factors, the delays – while frustrating – should reflect caution rather than failure.

As of the most recent updates, the launch timeline still remains subject to change. 

And while progress continues, Payments Canada has adjusted projected timelines multiple times before, so it’s not unlikely that they’ll do it again.

In any case, business owners should understand that large infrastructure rollouts of this scale often move slower than anticipated.

What Do These Delays Mean for Business Owners?

For many business owners, the shifting timelines around real-time rail have created uncertainty about when – or how – to prepare.

Some may be holding off on upgrading systems, while others are unsure whether this will have any meaningful impact on their day-to-day operations.

Having said that, understanding what these delays actually mean can help you make more informed decisions rather than just reacting to headlines or speculation.

Here are a few key takeaways that you might want to consider:

Delays May Reduce Risk

Launching prematurely could create systemic vulnerabilities, and in payments infrastructure, stability matters more than speed.

As such, a delayed launch may ultimately result in a more secure and reliable system.

Real-Time Rail Will Not Replace Card Payments

It’s important to understand that real-time rail is not a replacement for credit card networks.

Credit card networks provide:

Global acceptance

Rewards ecosystems

Consumer protection

Chargeback frameworks

And real-time rail will likely complement these existing networks, rather than replace them.

Adoption May Be Gradual

Even after launch, widespread adoption may take time.

Financial institutions, processors, and businesses will need to integrate systems and adjust workflows.

So, real-time rail will likely gain traction in specific use cases first, such as B2B payments, before expanding more broadly.

All things considered, at this stage, most businesses should not overhaul their payment strategy solely in anticipation of this new infrastructure.

Instead, you should focus on:

Ensuring reliability and uptime

Understanding your fee structure

Optimizing current funding timelines

Preparing to adapt once RTR becomes operational

Staying informed about this is wise, but making drastic changes prematurely is not necessary.

Final Words

Real-time rail represents one of the most significant upgrades to Canada’s payment infrastructure in decades.

Among other things, it promises:

24/7 availability

Instant settlement

Improved cash flow

Greater innovation in payment services

However, the rollout has been much slower than many expected, and these delays reflect the scale and complexity of transforming a national financial system.

For Canadian business owners, the key takeaway is this:

Real-time rail is coming – but it will not instantly replace existing systems, nor will it immediately transform every transaction overnight.

In any case, understanding what real-time rail is, how it works, and how it may eventually impact your operations will allow you to prepare thoughtfully rather than react impulsively.

Not sure how your current payment setup will be affected by real-time rail?

If you run a business in Canada, there’s a good chance you rely on e-transfers, as they’re quick, familiar, and easy for both you and your customers.

But in the last few years, e-transfer scams have dramatically increased, and Canadian businesses are being hit harder than ever.

Many of these scams look completely legitimate on the surface. The messages mimic real Interac notifications, the emails look nearly identical to what your bank usually sends, and the payment instructions often come from addresses you recognize.

That being said, for business owners who are juggling clients, staff, and day-to-day operations, the sophistication of these scams makes them incredibly dangerous.

And unlike credit card payments, once an e-transfer is intercepted or redirected, the money is usually gone.

Banks rarely reimburse businesses for e-transfer scams because the transfer is considered to have been authorized by the sender.

In any case, it’s becoming increasingly important for business owners to understand what this new wave of e-transfer fraud entails, and how to avoid getting scammed like this.

So, let’s break down what’s been happening, how e-transfer scams work, and the steps you can take to protect yourself and your business.

Why E-Transfer Scams Are Increasing in Canada

E-transfer scams are rising rapidly across the country, and several factors have contributed to this. 

As digital payments become the norm, fraudsters are focusing their efforts on the tools Canadians trust most.

E-transfers are fast, widely accepted, and simple to use, but those same benefits make them appealing targets for criminals.

Businesses – especially those that are handling multiple payments daily – are increasingly vulnerable because they tend to rely on email for communication, and email is one of the easiest entry points for scammers.

And this uptick isn’t random. Fraudsters today have access to more sophisticated phishing tools, compromised email lists, and automated systems than ever before.

Combine this with the fact that e-transfers are immediate and irreversible, and businesses become some of the most ideal targets.

The Most Common E-Transfer Scams Targeting Canadian Businesses

While these scams vary in terms of how they operate, they all exploit the same vulnerabilities, which include email communication, trust, and the finality of e-transfer payments.

Modern fraud attempts are no longer obvious, poorly written messages. Instead, they’re carefully crafted, data-driven, and often timed to match your actual business activities.

And because many business owners use e-transfers frequently, it’s easy for a fraudulent request to slip into a busy workflow unnoticed.

In any case, the following scams are the most common ones affecting Canadian businesses today – and the ones you’re most likely to encounter.

Spoofed or Fake Interac Notifications

Imagine this: You receive what looks like a real Interac email or text.

The branding is correct, and the message sounds legitimate. But when you click the link to deposit the payment, you’re taken to a fake login page designed to steal your banking credentials.

The moment you enter your email and password, the fraudster logs into your real account and starts sending money out.

The Overpayment Refund Scam

Here’s another scenario: A customer sends you an e-transfer for too much money, and they explain it was a mistake and ask for a refund.

But the original e-transfer never clears. It’s cancelled, fraudulent, or spoofed. And after you’ve sent the refund, that money is gone for good.

Business Email Compromise

This is one of the most financially damaging scams in Canada.

A scammer gains access to your business email, or the email of a supplier, customer, or employee, and then they wait, watch, and strike at the perfect moment.

Some common examples of this include:

A fake invoice sent from a hacked vendor email

A payment instruction change sent from an employee’s compromised account

A “follow-up” message on a real conversation, but with the fraudster redirecting the payment

Because these emails come from legitimate accounts, they’re extremely believable, and that’s what makes them so dangerous.

E-Transfer Deposit Interception

In this scam, the sender’s email is compromised.

A real e-transfer is sent to you, but before you can accept it, the fraudster intercepts the deposit notification and changes the deposit email or phone number.

Then the money is accepted by the scammer long before you ever see it.

Fake Security Alerts or Verification Requests

If you’re targeted by this kind of scam, you’ll receive a message claiming:

A recent payment failed

Your e-transfer is pending

You must verify your account

Your Interac profile needs updating

But when you click on a link, it leads to a phishing page that looks identical to your bank’s website.

And once your credentials are entered, the scammer has full access.

Warning Signs That an E-Transfer Might Be a Scam

Even though fraudsters are getting better at making scams look legitimate, there are still some signs that can indicate something isn’t right.

However, these red flags tend to be very subtle – sometimes only noticeable based on a tone shift, a slightly unusual request, or a small formatting issue.

But when you know what to watch for, spotting an e-transfer scam becomes much easier.

Teaching your team to watch out for these red flags can prevent most losses:

There’s pressure to act quickly

Payment instructions arrive at strange hours

You’re asked to click a link to deposit a payment

A customer suddenly uses a new email address for payments

The message asks you to verify, reactivate, or reclaim a transfer

The sender requests a refund before the transfer has fully cleared

The email design looks slightly off compared to normal Interac messages

All things considered, if you’re ever in doubt, make sure to call the sender to confirm the details, rather than emailing them.

At any rate, many businesses miss these clues simply because they’re busy or rushed.

But by building awareness and teaching your team what suspicious behaviour looks like, you can create a strong first line of defence against fraudulent e-transfers.

The Hidden Costs of E-Transfer Fraud

The financial loss of e-transfer scams is painful, but it’s only part of the problem.

When a business gets hit with e-transfer fraud, the ripple effects often extend far beyond the original amount that was stolen.

For instance, business owners typically spend hours untangling the situation by contacting the bank, alerting customers, updating passwords, and reviewing accounts.

And during that time, normal operations can slow down or even stall completely.

There’s also the emotional toll, as fraud incidents create stress for both owners and staff, especially when the scam appears to have come from a trusted contact.

For businesses that depend on strong relationships with customers or suppliers, a compromised transaction can also damage trust.

And with banks rarely reimbursing businesses for e-transfer fraud, the financial loss sits squarely on the owner’s shoulders.

Why Relying on E-Transfers Puts Your Business at Risk

E-transfers offer convenience, but they come with limitations that can create serious risks for your business.

Unlike professional payment systems, e-transfers don’t provide built-in dispute resolution, fraud monitoring, or multi-layered authentication. They’re designed primarily for personal use, not for the complex needs of businesses processing high-value or frequent payments.

And as your business grows, these limitations will become much more noticeable.

Multiple staff members may accept payments, invoices get larger, and tracking payments manually becomes time-consuming.

Over time, the risk increases – not because you’re doing something wrong, but because e-transfers weren’t built for the realities of commercial transactions.

Practical Steps You Can Take Today to Stay Safe

Fortunately, protecting your business doesn’t necessarily require major investment or complicated security systems.

Many of the best protective measures are simple, practical actions that can be implemented immediately, like:

Enabling multi-factor authentication

Training staff to recognize suspicious emails

Establishing internal procedures for verifying payments

And by combining these small steps with the security of a reliable payment processor, you can create a layered defence that significantly reduces your risk of falling victim to e-transfer scams.

How a Reliable Payment Processor Helps Protect Your Business

A secure payment processor provides safeguards that e-transfers simply don’t offer.

These systems protect transactions at multiple stages, not only preventing fraud, but also helping identify unusual patterns or suspicious inquiries before they lead to financial loss.

For businesses, this means greater confidence and less time spent managing or verifying payments.

Better yet, a trusted payment processor can help you reduce your reliance on email communication for payments, which is where many of these scams begin.

Tools like payment terminals, mobile readers, virtual terminals, and secure payment links make it much harder for fraudsters to interfere.

And when you have a dedicated support team to help verify concerns in real time, you’ll gain peace of mind that e-transfers alone can’t provide.

When to Switch From E-Transfers to Safer Payment Options

Every growing business eventually reaches a point where e-transfers are no longer the best option.

Having said that, if you’re processing payments more frequently, handling larger invoices, or involving multiple staff members in payment acceptance, you’ve probably outgrown e-transfers, whether you realize it or not.

Many business owners don’t make the switch until after a fraud scare.

But identifying the signs early gives you the opportunity to transition to safer, more efficient systems before an issue occurs.

If any of this sounds familiar, then it may be time to rethink how you accept payments.

The Bottom Line

E-transfer scams are rising quickly in Canada, and businesses are increasingly targeted because fraudsters know how busy and trusting owners often are.

And while e-transfers are convenient, they come with risks that grow as your business grows.

But if you work with a secure payment processor, you don’t have to navigate those risks alone.

Combined with a few simple internal safety steps, you can safeguard your business from the newest wave of e-transfer scams, and whatever might crop up in the future.

Need help reviewing your current payment setup or exploring safer ways to accept payments?

Canadian business owners have long voiced their frustration over the high cost of accepting credit card payments.

And up until recently, if you wanted to be able to process credit card transactions, this cost was unavoidable and non-negotiable.

Merchants had no legal way to pass even a portion of these fees on to customers choosing credit over debit, meaning they were forced to absorb the full cost of doing business in this way.

That reality began to shift in October 2022, when new rules allowed Canadian merchants (outside of Quebec) to apply credit card surcharges – a percentage fee added to the purchase price when customers pay with a credit card.

This change followed more than a decade-long class action lawsuit against Visa, Mastercard, and certain banks, which resulted in a settlement that not only reimbursed some past interchange fees, but also opened the door for merchants to apply surcharges moving forward.

These new rules have been in place for a couple of years, but the rollout of this functionality across payment systems has taken some time.

In any case, with most major terminals now equipped for surcharging, business owners have a real opportunity to recover a portion of their processing costs.

So, if you’d like to learn more about credit card surcharges, including how surcharging works, how it can benefit your business, and how to get started, then you’ve got to keep reading.

The Road to Surcharging in Canada

In Canada, the ability to add credit card surcharges didn’t appear overnight.

It’s the result of a long legal battle by Canadian merchants who argued that the interchange fees imposed by Visa, Mastercard, and certain banks were excessive and unfair.

If you’re not sure what interchange fees are, and you need a bit of background on this, you can read our article on What You Need to Know About Interchange Rates in Canada.

In any case, these interchange fees are still added to credit card transactions today, but at one time, merchants had no choice but to absorb these costs or raise prices across the board, as there was no option to impose a surcharge.

Then, in 2010, a group of Canadian merchants launched a class action lawsuit alleging that these fees violated competition laws and restricted merchants from steering customers toward lower-cost payment methods.

After years of legal proceedings, Visa, Mastercard, and several major banks agreed to a settlement that included monetary compensation for eligible merchants covering interchange fees paid between 2001 and 2021, as well as a rule change allowing surcharging (subject to certain restrictions) so merchants could pass some of these costs directly to customers using credit cards.

The settlement officially took effect in October 2022, but payment processors needed time to update systems, program terminals, and establish compliance procedures.

And today, many Canadian businesses finally have the infrastructure in place to add a surcharge to credit card transactions, if they choose to do so.

The Laws Surrounding Credit Card Surcharges in Canada

Everywhere else, merchants can apply a surcharge – but they must follow both federal regulations and applicable card brand rules (Visa, Mastercard, American Express).

What’s more, the surcharge amount cannot exceed your actual cost of accepting the credit card.

At any rate, the maximum amount you can surcharge is 2.40%, and you cannot apply a different rate for different transactions or card types.

For the most part, debit and prepaid cards cannot be surcharged, with the exception of Interac Debit transactions, which may include a maximum fee of $0.25 per transaction.

But no matter what you choose to do, transparency and clear disclosure are required.

For instance, you must display the surcharge rate prominently at both the point-of-sale and point of entry, such as your store entrance or the checkout page on your website.

What’s more, the surcharge must also appear as a separate line item on the customer’s receipt.

If you accept Mastercard, you must register with them 30 days before enabling surcharging, but Visa and American Express do not require this kind of registration.

However, both Visa and Mastercard require you to notify your acquirer (the financial institution that processes your payments) before implementing a surcharge.

Once you choose to surcharge, it must apply to all eligible credit card transactions – you cannot selectively apply it. And if you refund a purchase, you must also refund the surcharge amount.

While the federal rules apply nationwide, some provinces may have additional requirements, so it’s important to verify local compliance before starting.

How Credit Card Surcharges Work on Our Terminals

Here at Lucid Payments, our terminals are fully equipped for surcharging, and they’re designed to make compliance and implementation easy for Canadian merchants.

A 2.40% surcharge is automatically applied to all eligible credit card transactions, and the surcharge appears as a separate, itemized line on the customer’s receipt.

Debit and prepaid transactions are automatically excluded, except for Interac Debit transactions, which may include a $0.25 fee per transaction, should you choose to impose it.

The system ensures the surcharge is applied uniformly, refunds are processed correctly, and all transactions comply with applicable rules.

What’s more, our terminals help you to avoid surcharging errors by automating the process and ensuring compliance with card brand rules and Canadian law.

How to Start Surcharging with Lucid Payments

Evaluate Your Customer Base First, you should consider how your customers might react. Some may choose debit to avoid the surcharge, while others won’t mind paying a small fee for the convenience and rewards of credit cards.

Contact Lucid Payments Your Lucid Payments sales representative will walk you through the sign-up process for our surcharging program.

Register with Mastercard If you accept Mastercard, Lucid will help ensure your registration is submitted at least 30 days before you enable surcharging.

Prepare Customer Signage You must display surcharge notices at your entrance and point-of-sale. They should say something like: We impose a surcharge of 2.40% when paying with a credit card, which is not greater than our cost of acceptance. The surcharge amount will appear on your receipt. We do not surcharge debit or prepaid cards, except for Interac Debit.

Enable Surcharging on Your Terminal Lucid Payments will program your payment terminal to apply the correct surcharge automatically.

Train Your Staff Make sure your team understands how surcharging works so they can answer customer questions confidently.

The Benefits of Credit Card Surcharges

While every business is different, there are several clear advantages to implementing this option –especially when it’s done transparently and with the right payment partner.

With that in mind, here are the key benefits of credit card surcharges:

1) Cost Recovery

Credit card processing fees can significantly impact your bottom line, especially when it comes to high-ticket purchases.

With that in mind, surcharging allows you to pass a portion of those costs on to the customer, which helps to reduce your expenses without raising your base prices.

2) Price Transparency

One of the most important benefits of credit card surcharges is clarity.

Customers will see both the debit and credit card costs for their transaction before paying, so they aren’t forced to pay the surcharge, and they can choose to use debit to avoid it.

3) Customer Choice

Rather than raising prices for everyone to offset card fees, surcharging gives customers the choice to avoid the extra cost by selecting another payment method.

4) Competitive Fairness

Merchants have long felt that they’re at a disadvantage when compared to card issuers and banks, and surcharging helps to level that playing field, so merchants can manage costs more strategically.

5) Ease of Implementation

When you use credit card surcharges on our terminals, you can put your mind at ease, as everything is automated – the correct surcharge rate is applied, debit transactions are excluded, and compliance requirements are built in.

Is Surcharging Right for Your Business?

While surcharging can help to offset the cost of accepting credit cards, it’s not for everyone.

Some customers may view it negatively, especially in industries with strong price competition.

However, many merchants find that when the surcharge is clearly disclosed and customers understand that they have the option to avoid it by paying with debit, pushback is minimal.

So, before implementing a surcharge, you should think about your average transaction size, your customers’ payment preferences, how price-sensitive your clientele is, and the level of competition in your industry.

All things considered, for many Canadian businesses, particularly those with high average tickets or thin margins, the benefits of credit card surcharges tend to outweigh the risks.

The Bottom Line

Credit card surcharges represent a major shift in how Canadian merchants can handle payment processing costs.

For the first time, you have the option to pass some of those costs directly on to the customers who choose to use credit – a move that can improve profitability, increase transparency, and give your customers more choice.

Lucid Payments makes it easy to implement surcharging with full compliance, clear customer disclosure, and no extra fees.

So, if you’ve been looking for ways to manage rising costs without raising prices for everyone, this could be the solution you’ve been waiting for.

Are you ready to use credit card surcharging for your business?

As a small business owner, you’re probably juggling countless responsibilities, from inventory and staffing to marketing and customer service.

But one crucial area that’s easy to overlook is your payment processing system.

And if your checkout is slow, complicated, or outdated, you might unknowingly be frustrating your customers and hurting your bottom line.

Long lines, limited payment options, and concerns about security can send customers straight to your competitors, costing you valuable sales and damaging your reputation.

On the other hand, getting your payment processing right can dramatically improve customer satisfaction, boost customer loyalty, and help drive repeat business.

So, if you’re looking for better payment processing and you want to provide the absolute best experience you can for your customers at checkout, then this is an article you can’t afford to miss.

The Importance of Better Payment Processing

Over the past decade, how customers pay for products and services has dramatically evolved.

Today’s consumers expect transactions to be fast, convenient, and secure, regardless of whether they’re shopping online, at a retail store, or somewhere else altogether.

As a result, having a seamless checkout experience has become an integral element of the overall customer experience.

Slow, cumbersome, or outdated payment methods can frustrate customers, often driving them away to competitors who offer better payment processing.

But if you’ve got an efficient, reliable, and modern payment system, that can translate into much more satisfied customers.

All things considered, businesses that invest in better payment processing can expect to have much happier customers, and significantly more referrals, as satisfied customers are a lot more likely to recommend your services.

Speed: Accelerating Customer Satisfaction

Speed is one of the most noticeable and appreciated aspects of any checkout experience.

Quick transactions mean reduced waiting times, and this is incredibly important to your customers, particularly during peak shopping season.

Consider the difference between a customer swiftly tapping their card or smartphone, instead of having to manually go through the checkout process and deal with slow processing.

No matter how you slice it, the faster and smoother your transactions are, the more satisfied your customers will be.

What’s more, a swift checkout experience helps to make your business more efficient, as employees will spend less time managing individual transactions, giving them more time to focus on other things.

These benefits create a satisfying shopping atmosphere, which can contribute to repeat visits and positive word-of-mouth referrals.

Convenience: Meeting Customer Expectations

Having the flexibility to accept as many payment methods as possible has become another essential expectation of today’s consumers.

Offering multiple payment methods, including contactless cards, mobile payments like Apple Pay and Google Pay, and seamless online transactions, is no longer an option if you want to keep your customers.

Because if you limit yourself to traditional payment methods, you run the risk of appearing outdated and can easily lose potential sales to more forward-thinking competitors.

Moreover, a properly integrated POS system ensures accurate transaction data, which helps to reduce human error and streamline your operations.

And in addition to enhancing the customer experience, this can also improve your efficiency.

Security: Building Customer Trust Through Safer Transactions

Customers today are becoming increasingly concerned about the security of their payments.

With that in mind, if you’re looking for better payment processing, you should consider payment processing systems that prioritize robust security measures, including PCI compliance, encryption, tokenization, and sophisticated fraud detection tools.

Protecting customer data is incredibly important for maintaining and building trust, which is a crucial component of the relationships you have with customers.

In any case, if you clearly communicate your commitment to secure transactions, this makes you more trustworthy, and that means more customers will choose to keep giving you their business.

At the same time, breaches in security can cause lasting damage to your reputation and result in lost customers.

Staying Current: The Importance of Modern Payment Terminals

Because payment technology has been advancing so rapidly, if you want to remain competitive, you’ve got to make sure your payment processing systems remain fully updated.

Like it or not, investing in modern payment terminals is no longer a luxury but a necessity.

These state-of-the-art terminals facilitate faster and more secure transactions and accommodate all forms of payment, allowing you to keep pace with customers’ expectations, and ensure they remain satisfied.

And in addition to how this can benefit your customers, modern payment terminals often come equipped with digital receipts, integrated inventory management, and customer relationship management (CRM) tools, which allow you to collect valuable customer data.

Customer Loyalty and Retention: The Bottom-Line Benefits

Better payment processing does far more than just enhance the customer experience – it strengthens your relationships with customers, making them more likely to continue giving you their hard-earned money.

Loyal customers typically spend more, purchase more frequently, and will enthusiastically recommend your business to others. And ensuring you have a smooth and efficient payment process also helps to reduce cart abandonment rates, both online and in-store.

At any rate, offering a frictionless payment experience and simplifying every step in the purchasing process will inevitably lead to increased revenue, more satisfied customers, and greater loyalty.

Lucid Payments: Enhancing Your Customer Experience

Here at Lucid Payments, we understand the critical role payment processing plays if you want to have satisfied customers.

With that in mind, we provide comprehensive payment solutions that are specifically designed to help small business owners like you enhance the payment experience by focusing on speed, convenience, security, and ensuring we offer the most modern equipment.

If you decide to partner with Lucid Payments, you’ll gain access to:

Rapid Transactions: We ensure customers enjoy swift, efficient checkouts that enhance their overall shopping experience.

Advanced Security Measures: We protect customer data with robust encryption, secure payment methods, and PCI compliance.

Flexible Payment Options: We offer the convenience of a diverse array of payment methods, including contactless and mobile payment options.

Cutting-Edge Equipment: We regularly update our payment terminals to ensure you have access to high-quality equipment with all the latest bells and whistles.

Expert Customer Support: We provide 24/7/365 support, based in Canada, which ensures you’ll receive reliable and intelligible assistance whenever you need it.

If you allow customers to pay with debit or credit, then your payment processor is like the backbone of your business.

Among other things, a great processor will ensure transactions are seamless, costs are kept to a minimum, and customers remain satisfied.

But if you’re with a payment processor that subjects you to things like frequent downtime, hidden fees, or outdated technology, it can severely impact not just your bottom line, but also your reputation, your relationships with customers, and your ability to grow your business.

And considering how common some of this stuff is today, it’s no surprise that business owners are becoming less and less satisfied with their payment processors.

According to a J.D. Power survey, which polled more than 4,800 U.S. small businesses, as of 2023, small business satisfaction with payment processors had gone down six points from the previous year, as the cost of services increased and issues with processing payments continued.

Interestingly enough, here in Canada, regardless of how satisfied businesses are with these services, the vast majority said they’d be willing to switch payment processors, if they’re given the right incentives.

As you can see from the graph below, a survey from Chase, which polled over 2,200 Canadian businesses, found that 86% of respondents were “at least somewhat willing to switch vendors.”

But in an industry that’s as convoluted as ours, it can be tough to know when it’s time to switch payment processors.

So, if you’re not happy with the services you’re currently getting, and you want to find a new payment processor, we want to help you make the best decision for your business by highlighting five signs it’s time to switch.

Is it Time to Switch Payment Processors?

If you don’t have a good grasp of how things work in our industry, then it’s going to be tough to tell if it’s time to switch payment processors.

And by the time you’ve noticed something’s not right, it may be too late, as the damage has already been done.

With that in mind, let’s explore five telltale signs that it’s time to switch payment processors.

1) You’re Paying Flat-Rate Pricing

In the payment processing industry, flat-rate pricing tends to be advertised as more convenient and affordable, but the truth is, it’s the most expensive way to pay.

Unfortunately, because of the way it’s advertised, and the fact that most business owners don’t know any better, many get fooled into thinking they’re getting a good deal.

But as we pointed out in our article on Why Interchange Plus Pricing Is the Best Way to Pay for Payment Processing, a CFIB survey found that 54% of respondents had trouble understanding the contract they signed with their payment processor, and 41% are unsure about their pricing.

That being said, it’s no surprise that business owners are being taken advantage of in this way.

What’s more, the average flat rate offered in our industry is currently 2.4%, with some processors charging up to 2.65% or even more.

But only a select few credit cards have an interchange rate of more than 2.4%.

So, while flat-rate pricing might sound great in a slick ad campaign, at the end of the day, it’s going to cost you more money.

With that in mind, if you’re paying flat-rate pricing, it’s time to switch payment processors.

And if you’re not sure what interchange rates are, or you just need a little refresher, you can read our article on What You Need to Know About Interchange Rates in Canada.

2) You’re Finding Hidden Fees on Your Statement

In addition to promoting misleading pricing, unscrupulous payment processors are also notorious for adding miscellaneous “hidden” fees to your statement.

Truth be told, these fees aren’t really hidden at all, if you know where to look.

But the problem is many business owners don’t know how to decipher what’s on their statements.

As a result, payment processors will often sell business owners on a “discounted rate” but then make up for those lower interchange rates, and then some, by tacking hundreds or even thousands of dollars in extra fees onto your monthly bill.

They’re also known to do things like charging different amounts for the same fee multiple times on the same statement or adding extra fees to cards for which you’ve already paid interchange.

If you’re not familiar with this sort of thing, it can be somewhat difficult to determine, but our article on What You Need to Know to Spot Hidden Payment Processing Feesexplains everything.

And if you do find these kinds of fees on your statement, you should definitely start thinking about switching payment processors.

3) You’re Unable to Accept All Forms of Payment

Today’s consumers expect convenience and flexibility, regardless of how they choose to pay.

And whether they’re making purchases using a credit card, debit card, digital wallet, or any other form of payment, if your payment processor doesn’t support these options, it can lead to lost sales, dissatisfied customers, and a ruined reputation.

Like it or not, the popularity of new forms of payment, including mobile payment options like Apple Pay and Google Pay, continues to grow, and if your processor doesn’t allow you to accept these forms of payment, you risk alienating a significant portion of your customers.

Similarly, if you operate internationally, being unable to accept foreign cards or currencies can limit your growth and deter potential customers.

With all that in mind, you’d be surprised how many processors are still using outdated technology that limits how customers can pay.

But the truth is, you don’t have to let limited payment options hold your business back, and there are many processors out there (us included) that support all major forms of payment.

So, if you’re turning customers away because they can’t pay the way they want, then it is definitely time to switch payment processors.

4) Your Payment Terminal Is Falling Apart

Believe it or not, there are many merchants out there who are still using old beat-up payment terminals.

This may not sound like a big deal, but the truth is a malfunctioning or outdated payment terminal can seriously harm your business.

At the end of the day, a functional, modern terminal is not just a convenience – it’s a critical part of your business’ reputation and revenue.

Because when customers encounter a slow, unreliable, or poorly functioning payment terminal, or they see that yours is falling apart, it makes you look unprofessional and unreliable, creating a negative impression that can lead to frustration and abandoned purchases.

And aside from the fact that they may not support the latest payment methods, older terminals might not comply with current security standards, which can expose your business – and your customers – to potential fraud or data breaches.

Frequent breakdowns or maintenance issues can also disrupt your operations, resulting in lost sales and time wasted on troubleshooting.

In any case, if your payment processor isn’t offering upgraded equipment or providing prompt technical support, it’s a clear sign that they’re not prioritizing your needs and it’s time to think about changing payment processors.

5) Your Provider Doesn’t Offer Online Integration

This doesn’t apply to all businesses, as some do all their sales in-person.

However, if you want to sell stuff online, but your provider can’t do eCommerce, then it’s probably time to switch payment processors.

Because if you’re unable to accept online payments, you could be missing out on a vast and growing market of customers who prefer the convenience of shopping from their devices.

And even if you primarily operate a physical store, offering an online option can help to boost sales, expand your reach, and provide a safety net during unexpected disruptions, like having to temporarily close your physical location.

At any rate, without seamless eCommerce integration, managing sales across different channels can be incredibly inefficient and prone to errors, and dealing with online transactions manually can lead to wasted time, accounting inaccuracies, and frustration for you and your staff.

The first few weeks of the new year are always a great time for reflection, no matter who you are.

And if you’re a business owner, it’s the perfect time to take stock of everything related to your business.

Whether it’s setting objectives for the coming year, determining whether you reached the goals you set last year, or just looking for the cheapest payment processing, those first few weeks of the new year are easily the best time to do this sort of thing.

And with the holiday shopping season coming to a close, and the new year just around the corner, you should start thinking about this stuff now.

Because the truth is there are still far too many business owners out there who are paying through the nose to process payments, and if you’re one of them, now is definitely the time when you should be weighing your options.

So, if you’re thinking about switching payment processors, but you’re not sure how to go about doing it, then you should definitely keep reading.

This article explores why the best time to switch payment providers is early in the new year, explains how smaller local providers like us may be able to give you the best possible deal, and offers advice on what to consider if you’re looking for the cheapest payment processing.

Why Is Now the Best Time to Find the Cheapest Payment Processing?

Typically, December and February are the months when businesses see the highest volume of sales, as people tend to spend more money during these months shopping for Christmas and Valentine’s Day.

That being said, if you’re looking for the cheapest payment processing, then early in the new year is the best possible time.

But why is that?

Well, for one thing, reviewing your statements during the months when you’re doing the highest volume of sales will give you a better idea of what you’re actually paying, and the kinds of cards your customers tend to use.

At the same time, our industry is extremely convoluted, so as the Christmas rush slows down, and January rolls around, you’ll have some downtime to really sink your teeth into this stuff and get a better understanding of how our industry works, which will make it easier for you to get a good deal.

What’s more, one of the ways we work to save money for business owners like you is by doing a Rate Reduction Review, where we’ll analyze your last statement from your current provider so we can see the volume of credit transactions you’ve had, what kinds of credit cards your customers tend to use, and the interchange rates and other fees attached to those cards.

This allows us to determine where you’re spending the most, and what we can do to save you money by adjusting our rates.

What’s more, once January is here, your last statement would be from December, when you probably had significantly higher sales.

And if we analyze that statement, it’ll allow us to figure out how much you’re spending during high-volume months, which will give us a much better idea of the kind of savings we’re able to offer.

At this point, if you do choose to switch, we’ll also know how to adjust our rates so you can see significant savings in February, when you’re likely to see much higher volume again.

Simultaneously, this also gives us the opportunity to determine whether or not your provider is inflating your rates during high-volume months and will also allow us to break down everything on your bill, so you can actually understand what you’ve been paying for.

How Can Smaller Providers Offer the Cheapest Payment Processing?

We can’t speak for every payment processor out there, but typically, it’s the smaller providers who are able to offer the cheapest payment processing.

The main reason for this is that the big players in this industry tend to be multi-billion-dollar operations, and that means they have thousands of employees and massive overhead.

This means that they really can’t afford to give you a good deal, and they also have very little incentive to even try to be competitive.

Because for years, these companies were the only options for payment processing, so they’ve built trust and familiarity in their brands, and as a result, they’re pretty much guaranteed a steady stream of customers and therefore have no incentive to lower their prices.

Moreover, smaller processors know what it’s like to be a small business, so they can relate to what you’re going through and are more likely to want to give you a better price.

If you’d like to learn more about why the big payment processors won’t give you a better deal, you should check out our article on Two of the Biggest Myths About Payment Processing.

What’s more, because providers like us are struggling to compete against the behemoths of the banking industry, we have much more appreciation for each and every one of our customers.

And although we can’t speak for other processors, unlike the big banks, who like to treat everyone with the same cookie-cutter approach, we take the time to do everything on a case-by-case basis, working with clients to provide a personalized service that addresses their unique needs.

For example, if you’re primarily doing business online, where the interchange fees tend to be higher, then we’ll look at how we can lower our markup on those transactions. Or, if you mainly accept debit payments, then we’ll see what we can do to reduce our markup on those.

Some Other Things to Consider

Aside from everything we’ve already mentioned, there are a couple of other things you’re going to want to take into consideration, including the type of pricing processors use and the quality of the payment terminals they provide for their customers.

With that in mind, let’s look at why these aspects are so important to consider when you’re looking for the cheapest payment processing and thinking about switching to a new payment provider.

Pricing

The payment processing industry is notoriously tough to understand, not least when it comes to the way companies charge for their services.

For instance, many companies will charge a flat rate, meaning you pay the exact same interchange rate on every card a customer uses, no matter what.

This is often advertised as a way to save money, and a more convenient way to pay, when compared to other pricing models.

Unfortunately, nothing could be further from the truth, and flat-rate pricing almost always ends up being the most expensive way to pay, as the flat rates companies charge tend to be considerably higher than what you’d pay on most credit cards.

Other processors will offer a “discounted” rate, but then tack a bunch of miscellaneous fees onto your bill to make up for it.

If you’d like to learn how to spot this sort of thing, you should read our article, which explains What You Need to Know to Spot Hidden Payment Processing Fees.

We, on the other hand, pride ourselves on using interchange plus pricing, which means that when credit card companies lower their rates, that will always be reflected on your bill, and we’ll never inflate our rates or use other deceptive ways to make up the difference.

If you’d like to learn more about interchange plus pricing, you should read our article on Why Interchange Plus Pricing Is the Best Way to Pay for Payment Processing.

Payment Terminals

Believe it or not, many payment processors provide payment terminals that are old, beat up, or about to become obsolete.

This is true of many providers, including the giant corporations that dominate this industry.

These machines are much slower than newer ones, and many of them can’t process popular forms of payment, like Apple Pay and even contactless payments.

So, if you’re thinking about switching payment processors, make sure to research the processors you’re considering and ensure their payment terminals are up-to-date, and can accept all the latest forms of payment.

This is incredibly important to look into, as it can have a significant effect on your business, not least because you may have to turn away some customers depending on what form of payment they want to use.

And no matter what rates a processor is charging, if you’re going to have to turn customers away, or have ongoing problems with your payment terminals, it’s not going to be worth it.

Over the years, we’ve been shocked to see how rundown and outdated a lot of these terminals are, and the effect that this is having on business owners.

That being said, we’ve made a commitment to always provide our clients with new, state-of-the-art equipment, which helps their businesses to be more productive, profitable, and flexible.

No matter how you slice it, if you own a business, you’re going to need a payment processor.

But trying to decide which processor to choose can be incredibly confusing, not least because of how difficult it is to decipher their pricing.

The reality is, this stuff is often so convoluted, and processors can be so underhanded, that many business owners won’t know what fees they’re paying until after they get their first statement.

And even then, with all the hidden payment processing fees that tend to get tacked onto your bill, it can be tough to understand what you’re paying for.

It’s not uncommon for business owners to have no idea what they’re even looking at when reviewing all the fees on their bills, and their providers certainly aren’t doing much to make anything easier to understand.

We’ve seen this sort of thing happen far too many times, and had countless business owners come to us asking for help to understand what’s on their statements.

And this really is nothing new.

According to a Toronto Star article, back in 2019, the Canadian Federation of Independent Business (CFIB) surveyed about 12,000 of its members, asking them about their experiences with payment processors.

Unsurprisingly, 18% of respondents said these companies have misrepresented themselves, and 16% of them said they’ve used “deceptive sales practices”.

With that in mind, and in keeping with our commitment to providing absolute clarity, we want to explain what you can do to spot hidden payment processing fees that you might not know about.

So, if you want to avoid hidden fees in payment processing, or you just want to understand what you’re looking at on your statement, then this article is for you.

A Perfect Example of Hidden Payment Processing Fees

Before we go any further, let’s look at an example of a statement that contains these hidden payment processing fees.

For legal purposes, we’ll refrain from naming the processor or the client in question, but what you’ll see below is a real statement, brought to us by a business owner who was fed up with this sort of thing and looking to switch processors.

So, let’s break down this bill and look at what kinds of fees are hidden within.

Below is page three of this statement, which shows the total volume of sales for the month, and what cards this client’s customers were using.

If you look under the “Discount” heading, most of the cards on this list have a discounted rate of 1.36%, which is already suspicious, as that is a very low rate, and one which does not correspond to the non-qualified cards on the list, which we know tend to have a rate of 1.50% to 2% or more.

So, if this processor is only charging 1.36% on most of these cards, and taking a loss on the interchange fees, then how is it making its money?

Clearly, it’s not by marking up the interchange rates, but they’ve got to make their money somehow, so let’s dig a bit deeper.

If you take a look at page four of this statement, it’s obvious what this processor is doing.

When this business owner signed up with this processor, they probably sold them on their discounted interchange rate of 1.36% on most cards, but what they likely didn’t discuss was the litany of miscellaneous fees that would be on their bill.

Many of these fees are standard, but several of them stand out as fees that honest processors wouldn’t charge their customers.

For instance, the “DATASECFEE” is $447, and “SYSTEM MAINTENANCE” is another $65, not to mention the “PCI ADMIN” fee at $187 and $560 for a risk assessment.

Also, keep in mind that this isn’t some sort of annual thing – these are monthly fees!

What’s more, very few people know what these fees are for, so what’s on the statement is essentially meaningless, and a processor could put pretty much anything on there, as the majority of business owners wouldn’t know the difference.

But unfortunately, the hidden payment processing fees don’t stop here.

If you look at page five of this statement, which you’ll find below, there are two more lists of miscellaneous fees.

Some of them, like the risk assessment, were already tied to hundreds of dollars in other fees on page four, so why they’re here as well is anybody’s guess.

Another interesting thing to point out about this page is that it lists all the non-qualified cards that were processed, but there aren’t any rates listed for these cards, just more miscellaneous fees.

So, in order to see the real rates that you’re paying, you’d have to add up all the other charges on each individual card, which nobody would know to do anyway.

And here on page six is where the effective rates, or true rates, for each card are listed.

As you can see, all but one of these cards has a considerably higher rate than 1.36%, and some of them have a rate that’s more than twice that high.

Even a standard qualified Visa has an effective rate of 1.84%, so the question is, why are they offering a “discounted” rate of 1.36%?

Well, clearly this processor sells their pricing based on a discounted rate, and takes a loss on the interchange, but then adds hundreds of dollars of miscellaneous fees to clients’ bills to make up for it, and then some.

Finally, if you look at this client’s billing summary, which you’ll find below, the total cost for one month was nearly $1,700, which is insane for this amount of volume!

By our estimate, a business with this volume of credit and debit card sales should be paying less than a quarter of that amount.

But when your statements are this convoluted, and you use this kind of deceptive pricing, it’s easy to see why so many business owners get bamboozled by this sort of thing.

How to Spot Hidden Payment Processing Fees

The main problem with pricing in this industry is that it seems to all be based on interchange rates, and whether processors will discount those rates, or add a markup to them.

But with everyone being so focused on these rates, many business owners are forgetting that what matters is the overall cost of your bill.

Because if you’re getting discounted rates on every card that’s processed, but then paying hundreds of dollars in miscellaneous fees to make up for it, then you’re not saving anything.

Having said that, in addition to everything we’ve already covered here, if you want to spot hidden payment processing fees, you should stop focusing on the interchange rates and start scrutinizing the “other charges” and/or “other fees” sections on your bill.

If you see anything more than a $5-$10 statement fee, a fee for PCI, which should be $11 per month or less, or some equipment fees in these sections, then the truth is, you’re paying way more than you should.

Anything else is basically a hidden tacked-on charge, unless you’re subscribed to a point-of-sale system or something like that.

What’s more, the only time you should see a fee tied to a card is when there’s a rate included with that fee.

If you see fees being charged for cards with no corresponding rate, then they’re just tacking miscellaneous fees onto your bill because they can.

Now, to be fair, a lot of these fees aren’t technically hidden, and if anything, they’re more hidden in plain sight than anything.

But even though they’re listed on your bill, without the knowledge we’ve provided in this article, chances are you wouldn’t know what most of them are for, and that is essentially the same thing as them being concealed.

At any rate, hopefully this article has given you greater clarity on how to understand everything on your statement, including how to spot hidden payment processing fees.

And we encourage you to share this information with fellow business owners, as the more merchants know about this, the less payment processors will be able to get away with it.

As we’ve been saying since we started in this industry, Canadian businesses are paying way too much when it comes to interchange fees.

But an agreement between the feds, Visa, and Mastercard, which just came into effect last week, may be able to provide some relief, at least for some small businesses.

Truth be told, the Canadian government has been talking about regulating interchange fees for years now, but until recently, it didn’t seem like they were going to do anything about it.

We’ve been covering this specific story for about two years now, but our current federal government started talking about it way back in 2019, when the Liberals began leveraging this issue as part of their election campaign.

Back in 2022, we published our first article on this, which asked, Is the Canadian Government Really Going to Regulate Interchange Fees?

At the time, things were still very uncertain, and whether the government planned to actually bring in regulations was anyone’s guess.

But if you’d like some background on this story, that article is a good place to start.

Then, last year, after the government announced it had reached an agreement with Visa and Mastercard, we published a second piece on this story, Feds Finally Reach Deal With Visa and Mastercard to Lower Interchange Fees for Small Businesses in Canada.

This article goes into great detail on the ongoing fight to lower interchange fees in Canada and sums up the terms of the agreement, so if you want to know more about how this story has been unfolding, you should check it out, as well.

In any case, now that this agreement has come into effect, we want to make sure you’re aware of what’s happening and offer our take on it, as well.

So, if you want to learn more about these changes to interchange fees in Canada and get our honest opinion on what this actually means for your business, then you’re going to want to keep reading.

How Does This Agreement Affect Interchange Fees In Canada?

Earlier this month, the government published a press release outlining what it’s supposedly doing to help small businesses in Canada, including capping interchange fees for eligible businesses.

“The federal government is making life easier for locally owned businesses by introducing reduced credit card transaction fees,” said Minister of Public Services and Procurement Canada, Jean-Yves Duclos.

But how exactly is this going to work?

Well, according to the feds, as a result of these changes, over 90% of small- and medium-sized Canadian businesses will see their interchange fees slashed by up to 27%, and this is projected to save small businesses about $1 billion over the next five years.

With that in mind, here’s what Visa and Mastercard will be doing for eligible businesses as a result of this agreement:

Reducing domestic consumer credit interchange fees for in-store transactions to an annual weighted average interchange rate of 0.95%

Lowering domestic consumer credit interchange fees for online transactions by 10 basis points, offering reductions of up to 7%

Providing free access to “cybersecurity and online fraud resources” to help small businesses sell more online, while preventing fraud and chargebacks

However, only businesses and non-profits with annual Visa sales of less than $300,000 will qualify for lower interchange rates from Visa, and only those with annual Mastercard sales of less than $175,000 will qualify for lower rates from Mastercard.

It’s also important to point out that organizations will have to qualify with each credit card network individually.

The government even provided an example of how this could help, saying that if a business processes $300,000 in credit card payments, it could save $1,080 in interchange fees.

But is this an accurate representation of the interchange fees Canadian small businesses pay?

And is this agreement as good as the government’s making it out to be?

Let’s take a closer look and find out.

Our Take on These Changes to Interchange Fees in Canada

As we said in our last article on this, it’s great to know that small businesses in Canada may end up seeing some relief from the insanely high interchange fees they’ve been paying.

It would have been nice to see these fees reduced even further, but going from an average interchange rate of 1.4% down to 0.95% is nothing to scoff at either.

However, when it comes to this agreement, and this latest announcement, there’s a lot to criticize.

For one thing, the government’s being very disingenuous with its example of the interchange fees a business would supposedly pay.

In its latest press release, the government claims that if a business in Canada processes $300,000 in credit card payments, they’ll pay about $4,000 in interchange fees.

But we did the math on this, and they are really lowballing it.

Because in order to pay only $4,000 in fees on $300,000, the cards you’re processing would have to have a rate of no more than 1.33%, which is pretty much unheard of.

To put things in perspective, if you were to calculate the interchange fees paid on that same amount through Square, which charges rates of at least 2.65%, and is the processor of choice for many small businesses in Canada, it would come to $7,950, which is nearly twice as much as the government’s estimate.

What’s more, even though the government has published several press releases on this agreement, we’re still left with many unanswered questions.

For instance, while the government keeps talking about how businesses will have to qualify with each card network, there’s been no indication of how they can do that, either from the feds or the credit card companies themselves.

So, even as these new changes have come into effect, it’s yet to be seen how businesses will be able to qualify.

Moreover, neither the government nor the credit card companies have given any indication as to where businesses can access the free “cybersecurity and online fraud resources” they’ve committed to provide.

Furthermore, as we’ve learned over the years, many small businesses in Canada are with payment processors outside of Canada, but because this agreement was made solely between the Canadian government, Visa, and Mastercard, there’s no reason to think that these changes will apply to foreign payment processors.

As we outlined above, these reductions are only for “domestic consumer credit interchange fees”, so we can only assume that this applies to Canadian payment processors only.

As a result, many small businesses in Canada will never see these rate reductions, not least because this agreement doesn’t apply to their processors.

Also, in a press release on this agreement published last year, the government said it expects “that payment processors will pass these reductions on to small businesses.”

But if you know anything about our industry, you’d know that many payment processors are notorious for refusing to pass interchange rate reductions on to their customers, instead choosing to obscure these savings by padding people’s bills with miscellaneous fees.

Moreover, the payment processors and the banks are not part of this agreement with the government, so they can continue to do whatever they want, and they will.

Sadly, all of this shows just how out of touch our federal government is with the frustrations of small business owners in this country.

And as far as we’re concerned, this agreement is much too convoluted, it leaves way too many questions unanswered, and it doesn’t go nearly far enough, as it’s not applicable to so many small businesses in Canada.

Unfortunately, there’s nothing we can do to stop the government from being so unclear about this.

But we will continue to cover this ongoing story, making you aware of any new updates, and breaking it down as best we can to help you gain greater clarity on your payment processing.

In today’s world, if you want to build a successful company, you’ve got to know how to grow your business on social media.

Like it or not, these platforms are an essential aspect of any modern marketing strategy, and if you choose to ignore them, you’re doing so at your own peril.

No matter how you slice it, there is no denying that social media platforms offer a ton of benefits for your business, allowing you to build brand recognition, forge meaningful relationships with customers, foster trust and loyalty, drive sales, and achieve substantial growth.

For instance, in an Ipsos poll, which explored the impact of Messenger, Instagram, and Facebook on Canadian businesses, 33% of respondents said these platforms helped them start their companies, and 46% said their businesses are stronger today because of them.

What’s more, 36% of exporters said using Instagram has helped them increase sales, and 35% said Facebook has helped them sell more.

As you can see, these kinds of platforms can have a significant impact on your ability to grow your business, and that’s because consumers are increasingly using them to connect with companies, research products, and make purchases.

For instance, a PwC survey, which polled more than 20,000 consumers across 31 countries, found that 46% of them have purchased products on social media, up from 21% in 2019, 67% of them use social media to find new brands, and 70% of them read reviews on social media before choosing to make a purchase.

All things considered, it’s undeniable that consumers are increasingly using social media to do their shopping, so if you avoid these platforms, you could be leaving a lot of business on the table.

With that in mind, we want to provide some advice on growing your business through social media.

So, if you’re wondering how to grow your business on social media, and you’re looking for some tips, then this article is for you.

Our Top Tips on How to Grow Your Business on Social Media

At this point, it should be obvious that social media offers one of the best ways to connect with customers, make more sales, and grow your business.

But growing your business on social media is about more than just posting regularly. It requires a deep understanding of these platforms, and how to use them to your advantage.

Luckily for you, below we’ve offered 11 tips on how to grow your business on social media, so you can take full advantage of these platforms and avoid getting left in the digital dust.

1) Understand Your Audience

The foundation of any successful social media strategy is a deep understanding of your audience.

Knowing who they are, what they like, and how they interact with content is crucial, and this involves analyzing demographic data like age, location, gender, and interests.

Tools like Google Analytics, Facebook Insights, and Instagram Analytics can provide this information, and this will allow you to tailor your content to meet the specific needs and preferences of your audience.

This ensures your messaging will resonate with consumers, which will help you to maximize your return on your efforts.

2) Choose the Right Platforms

Although you may be tempted to use every platform out there, the truth is, not all social media platforms are suitable for every business.

That being said, it’s crucial for you to focus on platforms where your ideal customers are most active.

For instance, if your target audience includes professionals, then LinkedIn is probably the most appropriate platform.

On the other hand, if your focus is on a younger demographic, platforms like TikTok and Instagram are more preferable.

This strategic selection is very important, as it prevents you from wasting time and effort on platforms that do not house your target audience.

3) Develop a Strong Brand Voice

Ensuring consistency when it comes to your brand’s voice is key, and this is true across all marketing channels, including social media.

Aside from just being consistent, this voice should reflect your brand’s values and resonate with your ideal customers.

And whether it’s professional, friendly, informative, or playful, a distinct and consistent brand voice helps to make your content recognizable and relatable, which strengthens your brand identity, and builds trust with your audience.

4) Engage Rather Than Broadcast

Social media should be interactive, which means you’re going to have to engage your audience.

You can do this by responding to comments, messaging followers directly, and participating in discussions, all of which can transform passive followers into active participants.

This engagement not only enhances your relationships with customers, but also boosts your visibility through increased interactions, which platforms like Facebook and Instagram favour in their algorithms.

5) Create Visual Content

Visuals are key when it comes to capturing people’s attention on crowded social feeds.

That being said, high-quality images, engaging videos, and eye-catching graphics can help you to significantly increase engagement.

Platforms like Instagram and Pinterest, for example, are highly visual and require strong imagery if you want to stand out.

With that in mind, you might want to consider using tools like Canva or Adobe Spark to help you create professional-looking visuals that will attract more views and shares.

6) Leverage User-Generated Content

Encouraging your customers to share their experiences with your brand can provide social proof and enhance your credibility, and social media offers a great place to do this.

What’s more, user-generated content not only offers authentic insight into your brand from a consumer’s perspective but also helps in building a community around your products or services.

In any case, featuring user-generated content on your social media accounts can help you to increase trust and foster a stronger connection with your audience, making it more likely that they’ll want to do business with you.

7) Social Media Advertising

Social media ads allow for targeted advertising based on specific demographics, interests, behaviours, and more.

These tools give you the ability to precisely target potential customers and drive conversions by serving your ads to the right audiences at the right times.

But when you’re creating your ads, make sure that you understand your audience first, and then set clear objectives, choose the right platforms, and make sure to use high-quality, enticing visuals.

Retargeting is also something to consider, as it allows you to serve ads to those who’ve already interacted with your brand but haven’t made a purchase.

8) Post Regularly But Not Obsessively

If you want to keep your audience engaged, and avoid annoying them, you’ve got to post regularly, but not obsessively, otherwise you’ll risk overwhelming them.

Too much content can make people want to unfollow you, while too little can cause your audience to forget about your brand, so you’ve got to find the right balance.

In any case, you should think about creating a content calendar, as it can help you organize and schedule your posts, so you can ensure consistent engagement without spamming your followers.

9) Monitor Trends and Adapt

Social media trends can shift rapidly, so you’ve got to stay up to date on things as much as you can.

This is extremely important, because staying updated with these changes and adapting your strategy accordingly is what’s going to help you keep your content relevant and engaging.

Whether it’s a new type of content, a viral challenge, or a change in user behaviour, staying on top of this stuff and being agile and responsive to these trends gives you a competitive edge, which can help you to grow your business.

10) Analyze and Optimize

If you want to be able to compete in the ever-changing world of social media marketing, continuous improvement is a must.

This involves regular analysis of what types of posts perform best, which times yield the most engagement, and where the majority of traffic comes from.

With that in mind, you should look into tools like Hootsuite, Sprout Social, and Buffer, as they offer comprehensive analytics, which allow you to measure performance across multiple platforms and improve your overall social media strategy.

11) Collaborate with Influencers

Influencer marketing is a great way to amplify your reach and lend credibility to your brand, not least on social media.

That being said, if you collaborate with influencers who share your target audience, you can introduce your brand to a broader, yet highly targeted audience that’s already interested in what you’re offering.

This strategy is particularly effective for gaining rapid visibility and traction for new products, services, or campaigns, as they’ll be promoted by people whom your target audience already knows and trusts.

Owning a business requires you to deal with a seemingly never-ending array of challenges.

From dealing with finances, to managing employees, ensuring compliance with regulations, and everything in between, today’s business owners have a million and one things to worry about.

And when you’re dealing with something with this many moving parts, it’s easy to overlook things.

But while you can get away with overlooking some things, inventory management is something you just can’t afford to mess up, or you could end up dealing with some severe financial consequences.

For example, according to estimates from a Coresight Research survey, poor inventory management accounts for 53% of unplanned markdowns for retailers, and in 2018, markdowns cost U.S. non-grocery retailers approximately $300 billion.

What’s more, 50% of survey respondents said “inventory misjudgments” act as a barrier to selling their products at full price.

As you can see, this is not something you can afford to overlook. But trying to wrap your head around inventory management can also be incredibly overwhelming.

With that in mind, we want to offer some inventory management tips so you can stay on top of your stock and avoid the pitfalls of poor inventory management.

So, if you’re dealing with issues related to your inventory, and you’re looking for some inventory management tips and tricks, then you’re going to want to keep reading.

What Are Some Common Inventory Management Issues?

Before we start offering inventory management tips, we also want to explore some of the most common inventory management challenges.

This knowledge will help put things in perspective for you and offer even greater context for how you can apply the advice we’re about to give.

Having said that, here are some of the most common inventory management issues:

Inaccurate Inventory Tracking

One of the most common inventory management issues is inaccurate tracking of stock levels.

Errors in data entry, miscounts during stock audits, and discrepancies between physical stock and recorded inventory are all too common.

These inaccuracies can lead to stockouts, where items are unavailable when customers want them, or overstocking, where excess inventory takes up valuable space and ties up capital.

Both scenarios are detrimental, as stockouts can result in lost sales, dissatisfied customers, and many other problems.

Overstocking and Stockouts

Overstocking occurs when a business orders more stock than necessary, which can lead to high storage costs and an increased risk of inventory becoming obsolete.

On the flip side, stockouts happen when inventory levels are too low to meet customer demand, and this can result in missed sales opportunities and damage to customer relationships.

Both of these situations are costly and highlight the importance of accurate demand forecasting and efficient inventory management practices.

Inefficient Supply Chain Management

As we’ve all learned over the last few years, supply chain disruptions can severely impact inventory management.

Things like delays in receiving goods and unreliable suppliers can all contribute to inventory shortages or excesses.

Inefficient communication between supply chain partners can further exacerbate these issues, making it difficult to forecast your inventory needs accurately.

This can lead to a situation where you either overstock to mitigate the risk of stockouts or understock due to uncertainty, both of which are certainly not ideal.

Poor Demand Forecasting

Poor demand forecasting can also lead to either overstocking or stockouts.

And without reliable demand forecasting, businesses risk either tying up too much capital in unsold inventory or losing sales due to insufficient stock.

That being said, accurately predicting consumer demand for the products you carry is vital for maintaining the right inventory levels.

But in order to do this, you’ve got to analyze historical sales data, market trends, and other relevant factors, otherwise you’ll be more likely to misjudge demand.

This issue is also particularly challenging in industries with seasonal fluctuations or rapidly changing consumer preferences.

Lack of Real-Time Data

The absence of real-time inventory data can leave businesses operating on outdated information, leading to poor decision-making when it comes to inventory management.

Without these real-time insights, businesses may struggle to respond quickly to changes in demand or supply chain disruptions, and this lag in information can result in missed opportunities for restocking or unnecessary purchases of slow-moving items.

With that in mind, implementing systems that provide real-time inventory tracking can help businesses make more informed decisions and improve their overall inventory management efficiency.

High Carrying Costs

Inventory carrying costs, which include expenses related to storage, insurance, and the risk of obsolescence, can significantly impact your business’ profitability.

If you overstock inventory or fail to move products quickly enough, you’ll face higher carrying costs, which are often compounded by the need to discount or write off obsolete inventory, and these issues can significantly reduce your profitability.

With that in mind, effective inventory management practices, such as just-in-time (JIT) inventory, can help minimize carrying costs by reducing the amount of inventory held at any given time.

Ineffective Inventory Management Systems

Many businesses today still rely on outdated or inadequate inventory management systems that lack the sophistication needed to handle modern inventory challenges.

These systems may not integrate well with other business processes or may require manual input, which increases the risk of errors.

In any case, a failure to modernize your inventory systems can lead to inefficiencies that hinder your business’ ability to compete.

Luckily, modern inventory management solutions, particularly those that leverage automation and real-time data, can significantly enhance your ability to efficiently manage your inventory.

Our Top Inventory Management Tips

As you can tell by now, there is no shortage of issues when it comes to inventory management.

These may not all apply to your business, but if you fail to address the challenges that do, it could have far-reaching consequences from which you may never recover.

Fortunately, below we’ve provided a comprehensive list of inventory management tips and tricks, so you can avoid falling prey to the pitfalls of poor inventory management.

1) Understand Your Inventory

One of the best inventory management tips we can offer is to make sure you have a solid understanding of your inventory.

This involves categorizing your inventory based on things like how quickly your company can sell a given item, along with its value, and how quickly people will be looking to replace that item.

Employing an ABC analysis is useful here, and this involves segmenting your inventory into A-items (high-value products with low sales frequency), B-items (moderate-value products with moderate sales frequency), and C-items (low-value products with high sales frequency).

This classification can help you evaluate your inventory and then concentrate your resources on the most impactful items.

2) Leverage Technology

Incorporating technology into your inventory management process through things like inventory management software can significantly streamline your operations.

These tools provide features like real-time tracking, automated reordering, and detailed analytics, among many other benefits.

What’s more, this kind of technology allows you to integrate your inventory system with other aspects of your business, like accounting, procurement, and sales, which helps to ensure the consistency of your data and the efficiency of your operations.

3) Optimize Your Inventory Levels

When it comes to inventory management, optimizing your inventory is arguably one of the toughest challenges you’ll face.

With that in mind, setting Periodic Automatic Replacement (PAR) levels is crucial for maintaining sufficient stock so you can meet demand without overstocking.

Setting PAR levels involves using software to set the minimum levels of inventory you need to fulfill demand for a specific product.

Once this is done, the software will then notify you of the need for the item to be reordered and can even be set to automatically reorder stock when the minimum level is reached.

Moreover, the Just-In-Time (JIT) inventory strategy can also be effective for optimizing your inventory levels, as it involves keeping minimal inventory on hand and ordering more only as needed.

However, while this strategy can help to reduce carrying costs, it requires accurate demand forecasting and reliable suppliers.

4) Improve Your Forecasting

Effective inventory management relies heavily on accurate forecasting, which you can do by using historical sales data and considering factors like seasonal fluctuations and market trends.

In any case, it’s essential to regularly update your forecasts based on new sales data and external factors, such as economic shifts or changes in consumer behaviour.

5) Manage Your Relationships

Developing strong relationships with your suppliers can help you negotiate better deals and help to improve the reliability of your supply chain.

And if you’re able to successfully negotiate better terms by leveraging volume, loyalty, and payment history, it can yield significant benefits, including discounts and priority delivery schedules.

6) Monitor and Audit

Regular audits can help you verify that your physical inventory matches your inventory records, allowing you to promptly address any discrepancies.

Making use of cycle counting, for instance, which involves counting a subset of inventory on a rotating schedule, may help you pinpoint issues more efficiently than a full inventory count.

7) Properly Train Your Staff

Properly and regularly training your staff in the best inventory management practices and how to operate the systems you’re using is crucial.

What’s more, encouraging accountability by implementing performance metrics and involving your staff in planning and decision-making processes can also help to improve your inventory management.

8) Optimize Your Storage

Designing an efficient warehouse layout allows you to easily access frequently picked items, ensuring smooth and unobstructed movement of goods.

Utilizing vertical space for storage by implementing a racking system, for instance, can also help by more efficiently using your space and decreasing rental costs.

Not all businesses can afford to rent out warehouse space, but even if you’re storing your inventory in your garage, the same rules apply.

Whatever space you have should be used as efficiently as possible, and should allow for an easy flow of goods, particularly for your most popular items.

But if you are running out of room and you’re looking to scale without heavy investment in warehousing and distribution, outsourcing inventory management to a third-party logistics (3PL) provider can be advantageous, as it can help to reduce costs and improve operational efficiency.

9) Pick the Right Platform

Unfortunately, a lot of companies in our industry are still offering older payment terminals, most of which have no inventory management capabilities.

And if your device doesn’t offer these features, then you’re either going to have to have someone manage your inventory manually, which costs time and money, and can be subject to human error, or you’ll have to pay a third-party to take care of it for you, neither of which is ideal.

Fortunately, our platform offers online inventory management through an all-in-one, easy-to-use, centralized system that syncs with all your devices.

For example, if you do ten sales on your physical terminal, and five sales using your point-of-sale system, and then you log into our online platform, you’ll see all those sales in one place, and the products in question will immediately be deducted from your inventory.

So, ask yourself, when it comes to inventory management, is your payment processing platform working for you, or are you working for it?

Because if you are the one doing most of the work, then maybe it’s time for a change.

If there was an award for the most convoluted industry on the planet, payment processing would probably win by a landslide.

And if we had to choose the most needlessly complex aspect of our industry, it would have to be how processors choose to charge for their services.

Whether they’re using interchange plus pricing, tiered pricing, or flat-rate processing, typically, payment processors aren’t making things any easier for their customers to understand.

What’s more, business owners don’t seem to have any idea what these various fee structures are, how they work, or which one is going to give them the best deal.

As a result of all this confusion, it seems many businesses are just picking a processor at random without even bothering to look into their pricing.

For instance, a Canadian Federation of Independent Business (CFIB) survey found that 54% of respondents have difficulty understanding the contract they have with their payment processor, and 41% are unsure about their pricing model.

The survey also found that credit card processing fees are unaffordable for 78% of respondents.

However, many business owners are unwittingly choosing to partner with processors whose pricing is deceptively expensive, and the reality is they don’t need to be paying this much.

But given the abject lack of clarity in this industry, it’s no surprise that business owners are getting bamboozled like this.

With that in mind, this article will explain the most common pricing models for payment processing, including interchange plus pricing, tiered pricing, and flat-rate processing.

We’ll break down everything in no uncertain terms, exploring the various types of pricing, comparing them, and explaining why interchange plus pricing is your most affordable option.

If you’re new to this topic, and you’re not sure what the term interchange means in this context, you should start by reading our article, What You Need to Know About Interchange Rates in Canada.

And if you’d like a bit of a refresher on how interchange fees are calculated, you should check out our article, What Determines the Cost of Interchange Fees?

Why Is Interchange Plus Pricing the Best Way to Pay for Processing?

This seems like an easy question to answer, but as you may already suspect, it’s not as simple as you might think.

If you want to understand why interchange plus pricing is your best option, first you’ve got to understand the most common methods of paying for payment processing and compare them.

With that in mind, let’s explore the three most common ways to pay for payment processing, so you can understand why your best option is interchange plus.

Tiered Pricing

Tiered pricing is a pricing model where transactions are categorized into different tiers, each with its own interchange rate. The tiers include these three rates:

Qualified Rate: This is the lowest rate, applied to the most standard and secure transactions, such as swiped or chip-inserted debit or credit card payments.

Mid-Qualified Rate: A higher rate than the qualified rate, applied to transactions that pose a slightly higher risk, such as those involving rewards cards or manually entered card information.

Non-Qualified Rate: This is the highest rate, applied to the riskiest transactions, such as those made with corporate or international cards, or transactions that don’t meet certain security criteria.

This model allows payment processors to charge different rates based on the risk and processing requirements of each transaction.

If you’re being charged based on tiered pricing, that means you’ll have to pay a set qualified rate on every transaction, plus a mid- or non-qualified rate that applies to any transaction that doesn’t meet the requirements of the qualified rate.

So, for example, if a customer is paying with a qualified Visa and actually inserting their card into a physical machine, you’ll probably get a rate of around 1.45%.

Then for every transaction that’s mid- or non-qualified, that corresponding rate will get stacked on top of the qualified rate.

In theory, this model could offer some pretty decent pricing if the company gives you a good deal, but unfortunately, that’s rare.

Typically, providers will set their mid- and non-qualified rates high enough to ensure they’ll make the most profit they can, so you’re not likely to get a very good price.

In these situations, businesses will end up paying something like 0.85% on a non-qualified card, plus the qualified rate, which means they’ll be paying a total of 2.30% (1.45% + 0.85%).

But compared to what you’d be charged based on interchange plus pricing, this is a higher rate than what you’d pay for almost any card that’s available to consumers today.

So, as you can see, not only is this pricing model difficult to understand, but it’s also going to cost you more, as well.

Flat-Rate Pricing

One of the most common complaints we hear from potential customers is that they never know how much they’re going to pay in interchange fees each month.

As a result, many business owners choose to partner with a processor that offers flat-rate pricing, as this type of pricing tends to be advertised in a way that makes it seem like it’s more convenient and easier to understand.

But despite the clever marketing, the truth is that this is the most expensive pricing in our industry.

Providers who offer flat-rate payment processing will typically charge a highly inflated rate to make sure that they’re able to turn a profit on most transactions.

For instance, the average flat rate offered in our industry is currently 2.4%, with some processors charging up to 2.65% or even more.

So, while it may sound great to know exactly what you’re going to pay on every transaction, in reality, what this means is that for the lower-end cards and less risky transactions, you’ll have to pay double what you’d pay with interchange plus pricing, or even more.

To give you an idea of how much more expensive this kind of pricing can be, below, you’ll see Visa’s current interchange rates for consumer cards in Canada.

As you can see, only two of the dozens of cards on this list have an interchange rate of 2.4% or higher. And if you look at Mastercard’s rates below, you’ll see that the list looks very similar.

Again, only two of the cards on this list have an interchange rate of 2.4% or more.

Judging by these numbers, if you’re paying a flat fee that’s anywhere above 2%, you could be costing yourself hundreds of dollars per month in extra fees, depending on your volume of sales.

Truth be told, there are only a couple of different card types that cost more than 2.2%, so no matter how you slice it, paying these higher flat rates will cost you more money.

Interchange Plus Pricing

Hands down, this is easily the best pricing in our industry.

You’re welcome to try, but we can guarantee you’re not going to find anything cheaper.

We use interchange plus pricing because it keeps us competitive, it’s transparent and easier to understand, and it aligns with our mission of putting our customers first and always acting in the best interests of business owners.

That being said, rather than having to charge a high enough flat rate to profit on all cards or creating a convoluted tier system, interchange plus pricing allows us to offer you the exact interchange rate set by credit card companies like Visa and Mastercard, plus a small markup (usually 0.20% – 0.40%), which is how we make our money.

This means if your customer pays with a qualified Visa, you’ll pay 1.25% plus a markup of no more than 0.40%. That adds up to 1.65% or less, which is considerably lower than the average flat-rate pricing in our industry.

And that’s it. It’s really that simple.

With interchange plus pricing, you’ll pay whatever the interchange rate is on the card your customer is using, plus our markup.

This allows you to not only save money but also have greater clarity and peace of mind when it comes to your payment processing.

Another great thing about interchange plus pricing is that when credit card companies like Visa and Mastercard lower their interchange fees, this will immediately be reflected on your bill, which isn’t the case with many providers.

But with Lucid Payments, you won’t have to call in to try and get a better deal, or make sure these savings will be reflected on your statement.

The savings will simply be passed on to you the second that rates are lowered.

Interchange plus is also much more transparent, as well, because you’ll be able to see on your statement which cards you processed, what the interchange rates were on those cards, and what our markup is.

Time to Compare

Using the three different types of pricing we’ve covered today, let’s run a scenario to see which one will offer the better deal.

Let’s say your customers purchased $5,000 worth of products this month, and they all paid with a Visa Infinite card, which has an interchange rate of 1.57%.

For the tiered pricing, you’d be paying 1.57% plus 0.85%, so each one of those transactions would cost you 2.42%.

If you were being charged based on interchange plus pricing, you would’ve paid that same 1.57% interchange rate plus our markup of 0.20%, which would cost you 1.77%.

And for flat-rate pricing, you would’ve paid at least 2.4% on each transaction, regardless of what the interchange rate is on the card the customer is using.

So, if we do the math here, the flat rate pricing would cost you $120 in fees for those $5,000 in sales, and the tiered pricing would cost you $115, but the interchange plus pricing would only cost $88.50.

As you can see from this example, clearly, interchange plus is much cheaper.

And if you’re with a processor who charges you anything but interchange plus, you are simply paying too much.

As we’ve said countless times before, the payment processing industry suffers from a serious lack of clarity.

Business owners don’t understand it, processors aren’t making it any easier to understand, and unfortunately, they’re benefiting from maintaining that status quo.

We, on the other hand, have chosen to take a different approach by putting the best interests of business owners like you first and ensuring you have absolute clarity when it comes to your payment processing.

With that in mind, we’ve held our tongue for quite some time now, but we’re tired of beating around the bush while business owners get bamboozled, so we figured it was time to start doing direct comparisons between Lucid Payments and some of the giants of our industry.

But we’re not here to just give you a sales pitch, and we’re not looking to throw stones either.

All we want to do is provide an honest comparison of Lucid Payments vs. Square, so you can make up your own mind as to which processor will be best for your business.

So, if you’re looking for the best interchange rates, wondering what the difference is between interchange plus vs. flat rate pricing, or just want a direct comparison of Lucid Payments vs. Square, then keep reading to learn more.

Lucid Payments vs. Square: What’s the Difference?

If you want to choose the best payment processor for your business, then you need to compare what the various processors are offering.

And while that may seem simple, if you don’t have a firm grasp of how our industry works, particularly when it comes to interchange rates, then regardless of how much you compare, you’re probably not getting the whole picture.

With that in mind, below we’ve done a direct comparison of Lucid Payments vs. Square, and provided proper context, so you can come to your own conclusions.

Interchange Plus vs. Flat Rate Pricing

If there’s one thing business owners are most confused about when it comes to payment processing, it’s got to be interchange fees.

Hopefully, you’re aware of what they are and how they work, but if you want more information, you can check out our article on What You Need to Know About Interchange Rates in Canada.

In a nutshell, when you accept payments with credit cards or debit cards, you’ll have to pay a percentage of the cost of each transaction in what’s known as interchange fees.

The rates at which you’ll pay these fees are variable, and they’re based on things like the nature of the transaction, the industry in which you’re operating, and the type of card the customer is using.

That being said, one of Square’s perceived selling points is its flat rate pricing, which it refers to as being simpler, as you’re paying the same rate no matter what card a customer uses.

But as you can see below, according to an article from The Ascent, the average interchange rates on most credit card transactions are actually much lower than Square’s flat rate of 2.65% for an in-person transaction.

On average, three out of these four cards will cost you less than what you’d pay with Square, and when you start doing card-not-present transactions, that’s where things really start to get expensive.

For instance, for card-not-present transactions, like when someone buys something on your website, Square will charge you 2.9% plus a fee of 30 cents per transaction.

And if you’re keying in the information yourself, as you’d do when taking orders over the phone, it’s going to cost you 3.4% plus 15 cents per transaction, which is considerably higher than the rates on any of these cards, regardless of the nature of the transaction.

As you can tell, the issue with flat-rate pricing, despite it being advertised on its simplicity, is that the rates have to be high enough to cover the interchange rates on all possible cards.

But the truth is the rates on most cards will cost you far less than what Square’s charging.

So, while you may be able to make the argument that this is simpler, you can’t honestly say it’s more affordable.

With that in mind, our interchange plus pricing ensures you’ll be charged whatever the rate is on a given card, allowing you to avoid paying exorbitant flat-rate fees and ensure you’re always getting the best possible rate.

For example, if a customer makes a purchase with a Mastercard that has an interchange rate of 0.92%, with us you would pay 0.92% for that card, but with Square, you’d still be paying a whopping 2.65%.

Transaction Limits

Square, which uses a third-party processor, is notorious for imposing transaction limits that can stifle your ability to grow your business.

They typically impose these limits on new users, and those who have a lot of payment disputes, erratic activity on their account, or are selling high-risk goods or services.

And regardless of why they’re doing it, if they choose to impose a transaction limit on your account, when you go over that limit, they’ll start holding your funds.

But when you work directly with a payment processor, as you would with Lucid Payments, you’ll never have to deal with any of those limitations.

Canadian vs. American

We’re staunch supporters of both shopping local and supporting Canadian-owned businesses whenever possible, and we’re proud to say that we’re 100% Canadian-owned and operated.

Unfortunately, our industry is dominated by multinational conglomerates, most of which are American-owned, including Square.

That may not mean much to you, but from our perspective, it’s more important than ever for Canadians to keep our hard-earned dollars within our borders, not least with all the economic uncertainty we’re currently facing.

Statement and Equipment Fees

Another one of Square’s perceived selling points is that it doesn’t charge any monthly statement fees or fees to rent payment terminals.

We, on the other hand, do charge a $5 monthly statement fee, and $50 per month to rent a payment terminal, so in this aspect, Square’s got us beat.

But if you’re spending an extra 1.5% or more on most transactions, those fees can quickly add up to way more than $55 per month, and if that’s the case, you won’t be saving anything.

Like it or not, if you own a business, you’re going to need some kind of payment processing.

But our industry doesn’t do much to clarify things for merchants, and for the most part, it fails to provide easy payment solutions, keeping everything as convoluted as possible.

That being said, we understand how difficult it can be for business owners like you to try to understand what payment processing is, how it works, what exactly it is you’re paying for, and what provider you should choose to get the best service and the best deal.

With that in mind, at Lucid Payments, we’re on a mission to protect the best interests of business owners, provide easy payment solutions, and give you greater clarity on your payment processing.

And if there’s one member of our team who best embodies these goals, it has to be our long-time Sales Manager, Michael Nelson.

Our customers are constantly raving about the services Michael provides, as he loves to go above and beyond for them in whatever way he can.

As a show of our appreciation, we want to take this opportunity to highlight Michael’s dedication to our customers and introduce him to merchants like you.

So, if you’re searching for easy payment solutions, and you need someone to answer your questions and help you get everything set up, keep reading to learn how Michael can help.

Looking for Easy Payment Solutions? Michael Can Help

Whether you’re in the market for online payment solutions, payment solutions for retail, or something else entirely, Michael can make everything easy for you.

But before we go any further into that, let’s take a moment to get to know Michael a bit better.

Michael has been doing sales in one form or another for the last 25 years, he’s been with Lucid Payments for the last six years, and he currently lives in Sylvan Lake, Alberta.

Aside from his work in sales, before Michael joined Lucid Payments, he worked as a DJ for 27 years and ran his own IT business, which involved things like setting up networks and installing surveillance cameras.

Michael is also a single dad with four kids and the proud owner of a Chihuahua named Gringo.

When he’s not helping business owners, hanging out with family, or walking the dog, Michael loves to spend time cruising around on his Onewheel and dancing at music festivals.

Why Michael Chose to Work for Lucid Payments

Before starting with Lucid Payments, Michael had an awful experience working for another payment processor, not least because he felt like they weren’t being honest with him.

This was having a decidedly negative effect on Michael’s ability to do his job, and if they weren’t being honest with him, then you can bet they were doing the same thing with their customers.

“I worked for them for about three months,” he said. “And I walked away from it because I was ready to pull out my hair. I couldn’t even get answers to simple questions.”

Then he spoke to our VP of Operations, Steven Cumiskey, and that one phone call was enough to change Michael’s perspective on our industry.

Steven was able to answer almost all the questions Michael had, and the couple of things that he didn’t know offhand, he got back to him about the next day.

“I’ve used the term smoke and mirrors as my description of this industry,” said Michael. “But Lucid Payments offered all the clarity I was missing.”

What’s more, our mission, which is to protect the best interests of business owners, give them greater clarity, and provide simplified payment processing, really resonated with Michael.

“That’s exactly how I live my life,” he said. “When somebody needs something, I’m going to try and figure out a way to help them. And if I can’t, I’m going to try and find somebody I know who can.”

As a business owner himself, the most fulfilling part of Michael’s role with Lucid Payments has been helping other business owners.

Whether it’s helping them set up their equipment, showing them how to operate it, explaining how our industry works, going over their statements to explain what they’re paying for, or helping them save money on their payment processing, there’s nothing Michael loves more.

How Michael Has Helped Our Customers

Throughout his more than six years with Lucid Payments, Michael has helped countless customers.

Whether it’s issues with equipment, poor customer service, or just being tired of paying too much, if you’ve got a problem with your payment processing, or you’re looking for easy payment solutions, chances are, he can help.

And to give you a better idea of how he can help, here are some examples of what Michael has been able to accomplish for our customers:

Chief’s Pub & Eatery

Before choosing to work with Lucid Payments, Chief’s Pub & Eatery used to have lots of technical issues with the outdated payment terminals that were provided by their previous processor.

Michael recently switched them over to newer and more reliable machines, which has solved all of these problems for them, and we were even able to save them over 60 per cent on their monthly processing costs.

Mullets Barbershop

When they opened their first location about three years ago, Michael was able to help Mullets Barbershop get their payment processing set up and made sure they understood everything.

Since then, they’ve opened four more locations, and as a result of how happy they’ve been with the service Michael’s provided, they’ve chosen to work exclusively with Lucid Payments for their payment processing.

Party Chef

Party Chef, which combines a restaurant and local artisanal market, had a rough start when they launched a couple of years ago.

When they first opened, they went with a processor from Ontario, and within the first two days, they were already having issues accepting Mastercard and debit payments.

The following week, they agreed to go with Lucid Payments, and Michael was able to solve these problems by switching them to a more reliable and efficient payment terminal.

Shortly after that, they wanted to launch their website, so Michael worked with them on the initial setup, and he’s always available to answer any questions they have.

“I highly recommend Michael for his exceptional local service, strong communication skills, and willingness to go above and beyond to assist. He is always readily available to provide support and ensures that his clients receive the attention they need. Whether it’s a quick question or a more complex issue, Michael is consistently reliable and responsive,” said Party Chef’s owner, Lydia Neergaard.

“His dedication to helping others is evident in his proactive approach to problem-solving and his genuine interest in addressing clients’ needs. I have been consistently impressed with his professionalism and commitment to delivering top-notch service. I am grateful for his assistance and would not hesitate to recommend him to others.”

What Our Customers Have to Say About Michael

We’re constantly getting compliments from satisfied customers who can’t help but rave about the experience they’ve had working with Michael.

Whether it’s his helpful and friendly demeanour, dedication, expertise, or ability to provide easy payment solutions, our customers have no shortage of good things to say about him.

One look at our Google reviews, many of which mention Michael by name, should be enough evidence of that. Here are some of the compliments he’s received so far:

So, you’ve set up your online store, everything’s ready to go, and you couldn’t be any prouder.

Your website’s up and running, your products are all in stock, and you’re just itching to start filling up boxes and shipping out orders.

But despite your enthusiasm, you’ve barely made any sales, customers keep abandoning their carts, and at this point, you’d do just about anything to boost eCommerce sales.

To be fair, eCommerce problems are pretty common, both for retailers and shoppers, and today’s consumers have a lot of expectations when it comes to shopping online.

For example, in a survey from Coveo, which polled 4,000 shoppers from the U.S. and the U.K., 93 per cent of respondents said they “expect online shopping to be better than in-person shopping”.

What’s more, 91 per cent of respondents said they’ve encountered problems when shopping online, including things like poor site performance, missing product information, and irrelevant recommendations.

As you can see, in spite of their high expectations, consumers are dealing with a laundry list of many common eCommerce problems that are discouraging them from shopping online.

With that in mind, one of the best ways to differentiate yourself from other online retailers, and help to boost eCommerce sales, is to ensure your online store isn’t suffering from any of these issues.

Because when shoppers come to your store and have a seamless experience, and don’t have to deal with any of these frustrations, they’re going to be more inclined to do business with you again, and more likely to recommend your store to other people.

So, if you want to learn how to optimize your online store and boost eCommerce sales by providing the best possible experience for customers, then this article will definitely be worth your while.

Tips to Optimize Your Online Store and Boost eCommerce Sales

If you want to increase eCommerce sales, you’ve got to optimize your online store to make sure shoppers have a seamless experience.

With that in mind, these eCommerce optimization tips will help you address common eCommerce problems, improve your online store, and ultimately, sell more online:

1) Mobile Optimization

Everyone and their dog has a smartphone or tablet today, and that means optimizing your online store for mobile devices is absolutely essential.

By prioritizing mobile optimization, you’ll be catering to the growing number of consumers who prefer to shop on their mobile devices, thereby expanding your potential customer base and improving the experience consumers have shopping in your store.

Mobile optimization involves creating a seamless browsing and shopping experience for users, regardless of which device they’re using.

This includes doing things like implementing responsive design principles to ensure your website adapts gracefully to various screen sizes and resolutions.

2) Fast Loading Times

In today’s marketplace, consumers expect websites to load quicker than ever before, and as the years go by, their patience just seems to continue waning.

For example, a Digital.com survey, which polled 1,250 online shoppers, shows just how important site speed is when it comes to eCommerce sales.

53 per cent of respondents said they expect eCommerce pages to load in three seconds or less, and half of them said they will abandon their shopping carts if a page doesn’t load fast enough.

To optimize loading times, you can employ techniques such as image compression, minimizing HTTP requests, and leveraging browser caching, which will allow you to enhance user experience, keep shoppers on your site for longer, and increase the likelihood of conversions.

3) Clear Navigation

An intuitive navigation system is essential for guiding users through your online store and helping them find what they’re looking for efficiently.

This involves designing a user-friendly navigation menu that categorizes products logically and provides easy access to essential pages such as the home page, product catalog, and shopping cart.

It’s also important to incorporate a search bar with auto-complete functionality that enables users to quickly locate specific products.

These strategies help to enhance the experience shoppers have in your store and encourage them to explore your store’s offerings.

4) High-Quality Product Images

Visuals play a crucial role in eCommerce, not least because they allow customers to evaluate products and make informed purchasing decisions.

That being said, if you want to capture the attention of potential buyers and effectively convey the value of your products, you’ve got to include high-quality product images that showcase your offerings from multiple angles and perspectives.

By investing in professional photography and optimizing your product images for clarity and detail, you can enhance the visual appeal of your online store, inspire confidence in your offerings, and in turn, boost eCommerce sales.

5) Compelling Product Descriptions

In addition to captivating visuals, compelling product descriptions are incredibly important for persuading customers to make a purchase.

Well-crafted product descriptions should highlight key features, benefits, and unique selling points while addressing potential concerns or objections that customers may have.

You should also make sure that your product descriptions are as comprehensive and detailed as possible, so shoppers can have all the information they need to make their decision.

Crafting this kind of informative and persuasive copy for your product descriptions can help you increase eCommerce sales by allowing you to communicate the value of your products and differentiate them from your competitors’ offerings more effectively.

6) User Reviews and Testimonials

User reviews and testimonials from customers can significantly influence purchasing behaviour and can help to boost eCommerce sales, as they provide proof that other people have benefited from your products and/or services.

Prominently displaying this social proof on your online store provides prospective customers with reassurance and validation, which helps to build trust and credibility in your brand.

If you don’t have any testimonials, you can simply ask your existing customers to write them.

You’d be surprised how many customers will gladly do this for you, and you can even offer some incentives or rewards to encourage them if need be.

These testimonials will allow you to gather valuable feedback and collect user-generated content that can help boost eCommerce sales by enhancing your store’s reputation and fostering a sense of community.

7) Streamlined Checkout Process

The checkout process is a critical aspect of the customer journey, and optimizing it for simplicity and convenience can significantly impact your eCommerce sales.

As we already discussed, if your site is too slow, shoppers will simply abandon their carts, and because they’ve had that negative experience, they probably won’t come back.

That being said, if you want to increase eCommerce sales, you’ve got to do everything you can to ensure your store has a streamlined checkout process.

This includes doing things like eliminating unnecessary steps, offering guest checkout options, and providing multiple payment methods, which can help you improve customer satisfaction and maximize sales opportunities.

8) Personalized Recommendations

If you want to deliver relevant and engaging shopping experiences that resonate with individual customers, personalization is key.

By presenting customers with tailored recommendations that align with their interests and needs, you can increase cross-selling and upselling opportunities, enhance customer satisfaction, and drive repeat business.

Leveraging data and AI can allow you to generate these personalized product recommendations based on each customer’s browsing history, purchase behaviour, and preferences.

But if you want to avoid annoying your customers, make sure the recommendations you’re providing are as relevant as possible.

9) Optimized SEO

Search engine optimization (SEO) is essential for increasing visibility and driving organic traffic to your online store.

By optimizing product pages and content for relevant keywords, you can improve your site’s ranking on search engines like Google and attract qualified traffic from users who are actively searching for the products or services you offer.

You can also create valuable and informative content such as blog posts, guides, and tutorials, which not only enhances your site’s SEO but also establishes your brand as an authoritative resource within your niche and can help to further boost organic visibility and attract potential customers.

10) Social Proof and Trust Signals

Building trust and credibility is crucial if you want to convert visitors into customers.

With that in mind, displaying trust badges, security seals, and SSL certificates prominently on your website can help to instill confidence in visitors by establishing your store’s reliability and integrity, assuring them of secure transactions and data protection.

At the same time, showcasing social proof indicators such as social media followers, likes, and shares can serve as a testament to your store’s popularity and trustworthiness, further validating your brand and encouraging conversions.

11) Email Marketing Campaigns

Email marketing remains one of the most effective channels for nurturing customer relationships, driving engagement, and generating sales.

That being said, by building an email list of subscribers and customers, you can send targeted email campaigns that promote products, offer exclusive discounts, and announce special promotions or sales.

What’s more, using segmentation and personalization techniques can allow you to tailor your email content to specific audience segments based on demographics, purchase history, and preferences, which can increase the relevance of recommendations and improve conversion rates.

12) Abandoned Cart Recovery

Shopping cart abandonment is a common challenge for eCommerce retailers, but it also presents an opportunity for re-engagement and conversion.

Implementing abandoned cart recovery strategies, such as automated email sequences, enables you to follow up with customers who have abandoned their carts and remind them to complete their purchases.

What’s more, offering incentives such as discounts, free shipping, or limited-time offers can encourage customers to return to your site and finalize their transactions, helping you to reduce cart abandonment rates and recapture lost revenue.

13) Loyalty Programs

If you’re looking to boost eCommerce sales, fostering customer loyalty is essential, as it encourages customers to keep doing business with you.

Loyalty programs incentivize customers to engage with your brand regularly by offering rewards, discounts, or exclusive perks.

By rewarding customers for actions such as purchases, referrals, and social engagement, you can strengthen brand loyalty, encourage repeat business, and cultivate a loyal customer base that serves as passionate advocates for your brand.

14) Social Media Integration

Social media platforms provide valuable opportunities for engaging with customers, building brand awareness, and driving traffic to your online store.

Integrating social media into your eCommerce strategy allows you to leverage the power of social networks to promote products, showcase user-generated content, and interact with your audience in meaningful ways.

Making use of shoppable posts and ads, for example, enables you to facilitate direct purchasing from social media channels, which streamlines the path to purchase and allows you to take advantage of eCommerce trends on social media.

15) Continuous Testing and Optimization

Optimizing your online store is an ongoing process that requires extensive testing, analysis, and refinement.

By conducting A/B tests and experimenting with different elements of your website such as headlines, calls-to-action, and product layouts, you can identify what resonates best with your audience and what drives the highest conversions.

Monitoring analytics data, for instance, allows you to track performance metrics such as traffic, engagement, and conversion rates, enabling you to make data-driven decisions and revisit your strategy for continuous improvement.

16) Responsive Customer Support

Providing exceptional customer service is a fundamental part of building trust, resolving issues, and fostering positive relationships with customers.

For example, offering multiple channels for customer support such as live chat, email, and phone ensures that customers can reach out to you conveniently and receive timely assistance whenever they have questions or concerns.

Moreover, by responding promptly to inquiries, addressing customer issues effectively, and going above and beyond customers’ expectations, you can enhance the satisfaction and loyalty of your customers, which can help to improve eCommerce sales.

Payment processing technology is constantly evolving, and things can change so rapidly that trying to keep up with it all can be incredibly overwhelming.

But as a business owner, if you want to give your customers what they want, and be able to compete with others in your industry, you can’t just ignore this stuff.

You’ve got to do what you can to stay up to date on the latest technologies and trends in payment processing, otherwise, competitors who are paying attention to this stuff could gain a significant advantage.

And as much as possible, you’ve got to facilitate the forms of payment that consumers want to use, regardless of what they might be.

What’s more, being informed on payment processing industry trends can help you to understand where this technology is going, allowing you to know how your business may need to adapt in the future, and what you can do now to prepare for those changes.

With that in mind, we wanted to help make things easier for you by publishing an article on how payment processing technology will be evolving in 2024.

So, if you’re wondering where payment processing technology is headed, and you want to stay up to date on the latest payment processing trends, then this is one article you’re not going to want to miss.

Trends in Payment Processing Technology for 2024

As we already mentioned, trying to stay on top of this stuff can feel like a full-time job, and believe it or not, sometimes we even struggle to keep up.

But we’ve given it some thought, done some research, and below, we’ve listed what we believe will be the dominant trends in payment processing technology for 2024.

Increasing Popularity of Smart Terminals

Nearly everyone with a cell phone today is using some sort of smartphone.

There are still a few holdouts who will choose to use an old flip phone, for instance, but they’re few and far between, and becoming increasingly fewer.

Similarly, there will come a day when nearly all businesses are using smart terminals, and the popularity of these devices will undoubtedly continue to soar in 2024.

Smart terminals enhance the user experience with intuitive touchscreen interfaces and offer many different functionalities, including things like apps for inventory management, sales tracking, and loyalty programs.

And with all the apps you can download on these things, and all the apps that are currently in development, the functionality of these devices is only going to expand exponentially, and so it’s no wonder they’re becoming so popular and will continue to do so.

Smart terminals continue to stand out for their seamless connectivity, allowing for real-time data synchronization with cloud-based services, CRM systems, e-commerce platforms, and accounting software, which not only streamlines operations but also provides businesses with valuable insights into their performance.

What’s more, their adaptability and ongoing technological advancements position them as an integral tool for the future of retail and service industries, as they do a great job of catering to the dynamic needs of businesses in a marketplace that’s becoming more and more digital.

At any rate, the evolution of smart terminals in 2024 and beyond will also include a focus on sustainability by using things like energy-efficient designs and sustainable materials, which align with the growing consumer demand for more eco-friendly practices.

Terminals with Both Mobile Data and Wi-Fi Capability

In 2024, payment terminals with both mobile data and Wi-Fi capability will continue to gain popularity due to their ability to provide consistent, flexible, and reliable payment processing in many different environments.

This dual connectivity offers unparalleled flexibility by letting businesses operate seamlessly in areas with spotty Wi-Fi by switching to mobile data, allowing transactions to proceed without interruption.

These kinds of terminals are especially beneficial for mobile businesses like food trucks, pop-up shops, and service providers who work across multiple locations, as they can help enhance their ability to offer seamless experiences for customers, regardless of location.

Moreover, having two connectivity options reduces the risk of transaction failures, which is incredibly important for maintaining customer satisfaction, particularly during peak times. This adaptability not only improves operational efficiency but also gives businesses a competitive edge by meeting consumer expectations for hassle-free, quick payments.

Furthermore, the expansion of global mobile networks, including the rollout of 5G technology, will improve the performance of these terminals even more, making them an increasingly attractive option for businesses, especially those that operate across multiple locations.

Better Inventory Management

Inventory management on smart terminals is advancing rapidly, integrating real-time tracking, enhanced data analytics, and seamless supply chain integration, and will continue to do so throughout 2024.

Smart terminals are becoming much more sophisticated, using AI and machine learning to provide predictive insights, automate restocking, and optimize inventory levels based on sales patterns and demand forecasts.

User interfaces are also evolving to be more intuitive, with simplified navigation and customizable dashboards, making inventory management increasingly accessible to businesses of all sizes.

The integration of Internet of Things (IoT) devices, such as RFID tags and sensors, offers detailed tracking of goods, improving inventory accuracy and visibility throughout the supply chain.

In addition, cloud-based solutions are usually a standard feature of these devices, which help to ensure secure, scalable storage and remote management capabilities, and allow businesses to monitor inventory from anywhere.

Furthermore, an increasing number of smart terminals now support sustainable inventory practices, helping businesses to reduce waste and manage eco-friendly products more effectively.

All things considered, the evolution of inventory management on smart terminals in 2024 will be characterized by greater efficiency, intelligence, and integration, empowering businesses to respond more dynamically to market demands and manage their inventory in a more informed and sustainable manner.

Enhanced Security Measures

When it comes to payment processing technology, security remains a major concern.

The surge in digital transactions, not to mention the massive increase in data breaches over the last decade, has necessitated the development of more sophisticated security protocols to protect against fraud and other threats.

As a result, security measures for payment processing are continuously evolving, and the improvement of these safeguards will no doubt continue in 2024.

Technologies like tokenization and end-to-end encryption will continue to become more advanced, ensuring that sensitive information is securely transmitted and stored.

Furthermore, the adoption of blockchain technology for payment processing provides an added layer of security through decentralized ledgers, making transactions virtually tamper-proof.

Moreover, biometric authentication methods, such as fingerprint scanning, facial recognition, and voice authentication, are also becoming more prevalent, offering a seamless yet secure way to verify transactions.

These methods help to not only enhance security but also improve the user experience by simplifying the authentication process, and they will continue to evolve throughout 2024 and beyond.

Integration of Artificial Intelligence (AI)

It seems like every single industry has been disrupted by artificial intelligence technology, and the payment processing industry is no different.

AI already plays a crucial role in the evolution of payment processing technology, as AI algorithms are increasingly used to detect fraudulent activities and analyze spending patterns, offering real-time insights and proactive fraud prevention.

Machine learning models can also adapt and learn from transaction data, continuously improving their accuracy in detecting anomalies and suspicious behaviours.

In addition, AI can help to enhance customer service on payment processing platforms, as chatbots and virtual assistants, powered by natural language processing, provide instant support and guidance, facilitating smoother transactions, resolving issues, and answering questions more efficiently.

That being said, with all the benefits offered by AI, it will undoubtedly become a key element in the evolution of payment processing technology, both in 2024 and into the future.

Contactless and Mobile Payments Expansion

The trend toward contactless and mobile payments continues to accelerate in 2024, driven by consumer demand for convenience and speed.

Near Field Communication (NFC) technology has evolved, allowing for quicker and more reliable contactless transactions, and mobile wallets and payment apps have become more sophisticated, integrating loyalty programs, personalized offers, and financial management tools, which further enrich the experience of users.

Wearable technology has also entered the payment processing arena, with smartwatches and fitness bands equipped with payment capabilities becoming more and more common.

These technologies offer users an unprecedented level of convenience, allowing for seamless transactions with a simple tap or gesture, so it’s no wonder they’re becoming so popular.

If you want to learn more about contactless and mobile payment technology, you can check out our article on The Evolution of Mobile Payment Processing: A Look at the Latest Trends and Innovations.

Cross-Border Payment Innovations

As the global economy becomes more and more interconnected, the need for efficient cross-border payments has become more pressing.

That being said, in 2024, blockchain-based payment systems will be increasingly adopted for international transactions, offering faster, cheaper, and more transparent payment solutions compared to traditional banking systems.

These blockchain platforms can handle multiple currencies and automatically comply with various international regulations, simplifying the complexities of cross-border transactions.

In addition, these platforms will help to facilitate the use of digital currencies, including central bank digital currencies (CBDCs) and stablecoins, which can streamline global trade and commerce by facilitating quicker international transactions and reducing the dependency on conventional banking infrastructures.

These currencies, which will be more and more common as we move into the future, are becoming more integrated into payment processing systems, and that will continue to be the case this year.

Regulatory Evolution and Compliance

As payment processing technology evolves, so does the regulatory landscape.

With that in mind, in 2024, regulatory bodies worldwide will be adapting to the rapid technological advancements in payment processing, implementing new guidelines and standards to ensure consumer protection and the integrity of payment systems.

Regulators will also be focusing on open banking standards, which promote greater transparency and interoperability among financial institutions.

This regulatory environment will help to foster innovation while ensuring that new payment technologies adhere to strict security and privacy standards.

Emergence of Super Apps

The concept of super apps, which consolidate a wide range of services within a single platform, has significantly impacted payment processing technology, and there’s no sign of this slowing down in 2024.

These apps integrate payment functions alongside other services, such as messaging, social media, and e-commerce, creating a comprehensive ecosystem for users.

This integration offers a seamless experience, allowing users to perform multiple functions, including financial transactions, without switching between different apps.

Sustainable Payment Solutions

As is the case with practically everything else, in the world of payment processing technology, sustainability has become a significant consideration, and in 2024, that trend will certainly continue.

Keeping that in mind, this year, and into the future, there will be a growing emphasis on things like eco-friendly payment solutions, including digital receipts and more sustainable payment cards made from recycled materials.

What’s more, the shift toward digital transactions will also contribute to reducing the environmental impact associated with traditional paper-based payment methods.

With everything going digital, it seems that each year, more of our information ends up floating around on the internet.

This data can be very lucrative for the companies collecting it and can also provide a wealth of conveniences for consumers who are willing to give it up.

But despite all the advantages of this data being available, its very existence in the digital world is like bait for cyber criminals who are looking to profit from that data in any way they can.

According to an article from American Banker, in 2022, more than 250 million consumer records were leaked as a result of data breaches.

And it seems like there isn’t a single company that’s immune to this sort of thing, as many of these customer data breaches have happened at some of the biggest banks and financial services companies in the world.

What’s more, people are becoming increasingly aware of these risks, so if businesses want to retain the trust of consumers, they’re going to have to do everything they can to protect customer data.

A survey from Deloitte found that the number of consumers who trust online services to protect their data has been decreasing, with only 38 per cent of respondents agreeing that they trust online services to protect their data more now than they did a year ago.

And a survey from KPMG, which polled both business leaders and consumers, found that data privacy is a growing concern for 86 per cent of consumers, and 40 per cent of them don’t trust companies to ethically use their data.

Moreover, the survey found that 62 per cent of business leaders say their organizations should be doing more to protect customer data.

As you can see, consumers are becoming more and more worried about this issue, and companies are well aware of their apprehension.

But with all the data breaches that have been happening, it seems like many businesses aren’t doing enough to protect customer data, and as we can see here, some of them are even willing to admit that, at least anonymously.

All things considered, ensuring the security of customer data is becoming increasingly important for businesses today, and the ones that do their utmost to protect consumer data will continue to gain the trust of consumers.

With that in mind, we wanted to publish an article explaining what you can do to protect consumer data, so you can ensure you’re doing everything you possibly can to protect your customers’ information.

So, if you’re concerned about customer data privacy, and you want to know what you can do to protect that data, then this article is definitely for you.

What You Can Do to Protect Customer Data

The obligation to protect customer data is not only a matter of business integrity but also a legal requirement in many jurisdictions, and data breaches can lead to significant financial losses, legal penalties, and irreparable damage to your company’s reputation.

With that in mind, below we’ve provided 15 tips on what you can do to protect customer data.

1) Implement Strong IT Security Measures

Having strong IT security measures in place is one of the best things you can do to protect your customers’ information. Here’s some of what that entails:

Encryption: Encrypting data ensures that even if information is intercepted, it cannot be easily deciphered. This is crucial for protecting sensitive information like credit card numbers and personal identifiers.

Secure Password Policies: Implementing policies that require strong, unique passwords for customer accounts and encouraging or enforcing regular password changes can add another layer of security.

Regular Software Updates: Keeping all systems and software up to date to protect against known vulnerabilities is something else you should be doing if you want to protect customer data.

Firewalls and Antivirus Programs: These tools can help you to protect people’s data by preventing unauthorized access and monitoring for suspicious activities.

2) Employee Training and Awareness

If you want to ensure the security of customers’ data, then you and your employees all have to be on the same page about this stuff.

That being said, this won’t always be relevant to what they do, but if it is, you should make sure employees are trained on how to handle customer data securely, including recognizing phishing attempts and avoiding common security pitfalls.

3) Data Minimization

With the amount of money that can be made from people’s data, collecting it can be tempting, but if you’re serious about protecting customer data, you should make a policy of collecting only the data that’s absolutely necessary for business purposes.

The less data you store, the less you have to protect, and that can significantly reduce the impact of a potential breach.

4) Regular Security Audits

Conducting regular security audits can help you to identify vulnerabilities in your systems, but this can be incredibly technical, and it may not be relevant to your business.

But if you do have systems that house customer data, you might want to consider hiring an external cyber security firm to perform unbiased assessments and ensure your systems are as secure as possible.

5) Come Up with a Response Plan for Data Breaches

Every second that passes after a data breach can result in further damage and loss of data, which is why having a clear, well-communicated plan in case of a data breach is integral to ensuring the security of customer data.

This plan should include steps for how you’re going to control the damage, notify affected customers, and cooperate with authorities, if necessary.

6) Secure Payment Systems

No matter what kind of transactions you need to process, it’s crucial to ensure you and any third parties you’re working with are using secure, PCI DSS-compliant payment systems.

And you should also avoid storing sensitive payment information on your servers, if at all possible.

7) Data Backups

If you absolutely must hold on to customers’ data, you should make sure to regularly back up that data in secure, encrypted forms.

This not only protects against data breaches but also against data loss, which can happen for a variety of different reasons, such as hardware failure, human error, power issues, theft, and even natural disasters.

8) Mobile Device Management

With the increasing use of mobile devices, if you want to protect customer data, you’ve got to ensure that any customer data accessed through a mobile device is secure, regardless of whether it was done through your device or that of one of your employees.

With that in mind, make sure to implement policies and procedures for how to manage the use of personal devices for business purposes and ensure all your employees are aware of the consequences of not following these guidelines, both for them and for customers.

9) Implement Multi-Factor Authentication

Multi-factor authentication adds an extra layer of security by requiring users to provide two or more verification factors to gain access to a resource like an online account.

If you’re dealing with customer data online, ideally, this should be made mandatory, but some customers might not appreciate that kind of imposition, so at the very least, make sure it’s strongly encouraged and that customers understand why you’re asking them to set up this feature.

10) Monitoring and Reporting

Setting up systems to monitor data access and usage can help you to spot any funny business before things get out of hand.

This type of monitoring can flag any unusual activities, allowing you to promptly investigate any issues and get to the bottom of things before too much damage has been done.

11) Vendor and Third-Party Management

It’s typical for businesses to work with third parties when handling or processing customer data, but this can also put customers’ data at even greater risk.

With that in mind, you should make sure that any third-party vendors or partners who have access to your customer data also adhere to strict data security standards.

12) Encourage Customers to Use Chip-and-PIN or Tap

Encouraging customers to use chip-and-PIN or tap (contactless) payment methods can significantly enhance data security, not least because both forms of payment reduce the risk of skimming, where fraudsters can capture card details.

Chip-and-PIN technology is more secure than traditional magnetic stripe cards because the chip creates a unique transaction code for each payment, making it extremely difficult to counterfeit.

At the same time, tap payments use short-range wireless technology to transmit payment information, which adds an additional layer of security.

If you do most of your business online or over the phone, you might not be able to do this, but the more you can get customers to use these forms of payment, the more secure their data will be.

13) Avoid Card-Not-Present Transactions

Again, if you do most of your business over the phone or online, then this might not be possible for you.

But, if at all possible, you should try to avoid processing card-not-present transactions, as doing so can help to reduce the risk of fraud.

Card-not-present transactions, common in online and phone payments, are more vulnerable as they don’t require physical verification of the card, making it easier for fraudsters to use stolen card details.

So, if you can, try to provide incentives for customers to actually come to your store in person, such as in-store discounts, so you can protect your business from fraud and your customers can benefit from the additional security of inserting their card and entering their PIN.

14) Batch Out Your Terminal as Often as Possible

You’d be surprised how common it is for business owners to only batch out their terminals once a week, or even less frequently than that.

However, the reality is, batching out your payment terminal as frequently as possible is crucial for protecting customer data because each batch of transactions stored in the terminal represents a trove of sensitive information, and the longer that data is retained in your system, the greater the risk it could be compromised in the event of a security breach.

But by frequently batching out – that is, transmitting transaction data to the payment processor – the amount of data potentially exposed at any given time is minimized, and the window of opportunity for cyber criminals to access and steal customer information is limited.

That being said, if you can, you should make sure to batch out your transactions every day. And if you have to leave that information on your terminal for any amount of time, make sure you put it in a secure place, preferably a safe.

Because if someone steals that terminal, they’ll have access to all that customer data, and the transactions that are on it probably won’t get processed, and you’ll lose all that money, as well.

15) Only Allow People You Trust to Access Your Terminals

We’ve heard horror stories about new employees who were given full access to payment terminals, with nothing password protected, and then proceeded to scam their employers by doing things like giving refunds to all their buddies.

And if people are willing to do that, who knows what they’d be willing to do with your customers’ data?

That being said, you should ensure that everyone who has access to your terminals is trustworthy.

In some cases, it might be hard to tell if that’s the case, but at any rate, you should make sure to password-protect your refunds and limit access to sensitive data to only those employees who absolutely need it to perform their job duties.