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Electronic PaymentsBlog
July 24, 2025
Payments 101
Dealing with high fees? Poor service? Frozen funds? Your processor could be the problem. And it might be time to find a new one.
Merchants, you need to know you have a choice when it comes to your payment processor.
In this guide, we’ll show you why your processor matters and provide a checklist for vetting your options.
Most customers don’t pay with cash, so you need to accept credit and debit payments. But just a card swiper or point of sale system alone isn’t enough; to actually move money from customer to bank, you also need a payment processor—the service behind the scenes that authorizes, routes, and settles each transaction.
If you’re not clear on why your processor matters, you’re not alone; many merchants don’t have a clear picture of the backstage world of payment processing. You might have never had a reason to consider your processor before now, especially if you launched your business with a POS that bundled processing with everything else.
There’s nothing wrong with that, but it has one important consequence: if you don’t know you rely on a processor, you also don’t know that you have a choice of processors—and not all processors are equal.
If you’re considering a new processor, you’re likely in one of these scenarios:
All of these are great reasons to research and explore your options. Below, we’ll explore considerations specific to each.
When you’re just starting out, it’s easy to go with the first solution that helps you take payments, but this is also when you’re most flexible. Choosing the right processor from the beginning will give you a headstart on cash flow, support, and growth—and save you from headaches later on.
When evaluating processors, pay special attention to how well they support first-time business owners (or experienced business owners starting fresh with a new team and vertical). Look for partners that offer:
This is one of the most common triggers for considering a new processor; you often don’t look for alternatives until a problem becomes too hard to ignore.
Here are a few of the most typical concerns that initiate a new processor search:
If you’re experiencing high fees, unresponsive support, or frozen funds, these issues shouldn’t be dismissed as the cost of doing business; they’re signs that you might be able to find a more supportive processor.
You’ll want to vet your new options according to the issue that’s currently giving you the most trouble, but don’t forget to take the whole picture into account; you don’t want to fix your fee structure only to suffer from bad service with your new provider!
Switching your point of sale system is one of the best opportunities to evaluate your entire payments setup. While some POS platforms bundle processing by default, many allow you to bring your own processor—which gives you more control over costs, service, and flexibility.
Pay particular attention to integration concerns, including:
(And if you haven’t picked out your POS yet, check out our guide on choosing between different types of POS systems.)
As your business grows, your payment needs might become more complex. Whether you’re adding ecommerce to a brick-and-mortar store, launching a subscription offering, or expanding into mobile service, you need a processor who can support your new trajectory. What worked for you when your business was simpler may no longer be enough to keep up.
When evolving your business model, make note of what your current processor lacks that you need going forward. Seek out new processors that can support this and continue the same level of service you’re used to.
Here are some examples of what to prioritize based on your particular business transition:
Before you can evaluate your options, you need to round up your candidates. Here are a few sources merchants often use to create a comprehensive bullpen.
While it’s not always the case, most merchants get their POS and processing through a local payments agent or independent sales organization (ISO). Agents are the frontline of the payments industry and can offer invaluable recommendations, so if someone approaches you about switching processors, it’s well worth your time to hear what they have to say. Then, note down the processors they recommend and do your own research.
If you’re looking at a particular POS system or are still searching the market, you should also evaluate the processors associated with each system. Big-name POS systems like Square, Toast, and Shopify typically include processing bundled with POS. Similarly, your accounting application (e.g., QuickBooks) might have a default processor integrated with their software.
While it might seem most convenient to use the default option offered to you, you do have a choice; many third-party processors can integrate with a wide range of POS systems and softwares, so make sure you carefully compare all your options to see who will provide the best service.
After you’ve listed processors recommended to you and processors paired with your business tools, you can round out your list with an online search for payment processor options, even specifying your research to what’s important to you—for example, finding processors who can support small businesses, ecommerce, or your particular vertical. List the names you find to round out your list of options with alternatives that might not have surfaced previously.
After you’ve rounded up a shortlist of processors, it’s time to evaluate which one best fits your business. Whether you’re just starting out, switching systems, or trying to fix a frustrating experience, these are the factors that matter most in your search.
Make sure your processor supports all the ways your customers want to pay—and don’t forget to account for the future, too. Choose someone who supports your current needs and is set up to support emerging payment methods (even if you haven’t seen customers who request these yet).
Critical payment options include:
One of the most common complaints merchants have is confusing or unpredictable pricing. A good processor should be upfront about all costs, including:
Watch out for:
Before signing anything, be sure you fully understand the contract terms. Pay close attention to:
Red flags to avoid:
*Not all free offers are red flags, so make sure you’re checking the fine print rather than dismissing a great offer out of hand!
Security is non-negotiable. Your processor should help you stay compliant with industry standards—not make it harder. Look for:
Delays in deposits can disrupt your operations. Look for processors that offer:
You deserve responsive support when you need it. Don’t wait until an emergency to find out if your provider is reliable. Ask:
Your processor should work seamlessly with the rest of your tech stack. Check for compatibility with:
Your processor should grow with you—and support the unique needs of your industry. Look for:
Dual pricing can help offset your processing costs—but only if it’s implemented correctly. Your processor should provide:
Chargebacks are stressful—but a good processor helps you fight back. Prioritize processors that offer:
One of the most common surprises merchants face—especially with large aggregators (e.g., Square, PayPal)—is having their funds delayed or withheld after a big sale or unusual transaction. Aggregators operate under a shared merchant account model and often skip individual underwriting. That means risk reviews happen after a transaction—not before. In contrast, direct processors assign each merchant a unique merchant ID (MID) and evaluate risk upfront, making funding more stable and predictable.
During your evaluation, ask:
Getting started shouldn’t be complicated. Choose a processor that makes setup smooth and stress-free. Look for:
Whether you’re launching your first business, expanding your offerings, or trying to solve ongoing frustrations, the right payment processor can support your operations, simplify your day-to-day, and grow with you.
Start by identifying your needs, reviewing your current experience, and researching options that align with your goals. Take your time to compare features, pricing, and real customer support. And remember: you’re not locked into a single provider forever. The more you know about how payment processing works, the more empowered you’ll be to choose a partner who puts your business first.
If you’re looking for a transparent, full-service processor that offers 24/7 support, fast funding, and tools to help you grow, we hope you’ll add Electronic Payments to your list of processors to consider.
Explore our merchant services →
If you’re dealing with high fees, poor customer service, or technology limitations—or if your business has outgrown your current setup—it may be time to explore better options. Ask yourself if your current provider still meets your needs.
Your POS is the physical or digital tool you use to take payments (like a card reader or register). Your processor is the behind-the-scenes service that moves money from your customer’s account to yours. Sometimes they’re bundled, but you often have the option to choose your own processor.
Not at all. They vary in pricing transparency, service quality, funding speed, technology compatibility, contract terms, and more. A processor that fits one business might be a bad match for another—so it pays to compare.
New businesses should prioritize easy onboarding, flexible scaling options, and support from providers who can walk you through statements, fee structures, and future-proof tools.
Often, yes. But not always. Some equipment is proprietary or locked to a specific provider. Ask your new processor about compatibility—or whether they offer upgrades or replacements.
Pricing depends on factors like your industry, transaction volume, risk profile, and whether the provider is a direct processor or aggregator. Make sure you get a full breakdown of fees—and know what’s included.
Don’t just take their word for it. Look for 24/7 access, U.S.-based support, reviews from other merchants, and fast resolution times. If possible, test their support experience before signing on.
Key questions include:
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