Why does having the best mobile credit card processing matter? Well, if you work as an independent house painter, HVAC specialist, or in another role where you go to clients, you have to accept payments away from your office or workplace. To make payments easy, you probably have a mobile credit card processor, in addition to accepting cash and checks. Mobile credit card processing offers convenience for your clients. It also ensures you can get paid, even if a customer doesn’t have the cash on them. They can just swipe the card!There’s just one problem…Each time you swipe the card on your mobile credit card processor, you’re letting money fly out the window. You may think you have to pay those credit card processing fees, that it’s just part of the game. Want to know a secret? You don’t have to pay those credit card transaction fees. In this article, we’ll show you why you should pay attention to those fees, how to shop for the best mobile credit processing, and ultimately how to get free credit card processing. Read on!

Why contractors should pay attention to mobile credit card processing fees

Picture this: You’re a house painter. Since you run your own operation and manage a team, you bring in $230,000 in revenue from your house painting operation. Your net margins are 30%, which is considered good in the house painting industry. That means you make $69,000 in profits per year—a good deal above the national average salary for house painters. You may think: I’m doing quite well as a house painter. You are! But you could do even better…Now, the average cost to paint a house is nearly $2,900, according to Home Advisor. Given the high cost, many homeowners probably don’t pay you in cash (that’s a lot of cash to have on hand). They most likely write a check or swipe the credit card. Given that Statista data shows credit cards are the preferred payment method for 40% of purchases, and that Federal Reserve research finds that credit card usage increases as transactions values increase, it’s possible 50-60% of your revenue comes via credit card transactions. So, out of that $230,000 in house painting revenue, you could have left $138,000 subject to credit card processing fees (if 60% of your revenue came from credit cards). To understand how much that dents your salary as a house painter, first understand how much mobile credit card processing fees are. According to CreditDonkey, you’ll pay between 2.4-3% or more for even the best mobile credit card processing. After adding in other fees, such as monthly software fees and same-day funding fees, you could pay almost 4%. That’s a lot to pay just to accept payment. To give you a clearer picture, take a look at what Square charges business owners.

Square credit card processing fees

Square is transparent with pricing, which is good. But you still have software fees, hardware costs, and per transaction fee of $0.10 (on top of the 2.5%). Fees are higher if you have to key in the payment. Now, let’s go back to the house painter example. Here’s how much credit card processing fees are costing you in this scenario:

  • Let’s say, after accounting for all fees, you pay an average of 4% in credit card transaction fees on $138,000 of housing painting revenue. That’s $5,520 in credit card processing fees each year.
  • If you could eliminate those fees, your profits as a house painter would jump from $69,000 to $74,520. That’s a salary increase of 8%!

Whether you’re an independent house painter, tow truck driver, or car mechanic, it pays to pay attention to credit card processing fees. By getting the best mobile credit card processing for contractors, you could put more money back into your wallet. Think of what you could do with that extra money. You could save more for retirement, take a nicer vacation, put cash aside for your kid’s college, and more. The point is this: You don’t have to lose money to card transaction fees! It’s your money, and you deserve to keep it. Motivated to take action? Let’s discuss how you can get the best mobile credit card processing for contractors.

How to find the best mobile credit card processing if you’re a general contractor, house painter, HVAC specialist, etc

Know this: Finding the best mobile credit card processing isn’t as simple as looking at percentage fees. Since merchant service providers (MSPs) operate within an underregulated credit card processing industry, many MSPs actually charge more than what they advertise on the surface. They do that through hidden fees and complex pricing structures. Because of this, it’s vital that you not only read the fine print, but also educate yourself about mobile credit card processing for contractors. Begin with learning about the various fees you pay and the pricing models MSPs use. Let’s break it down for you: First, you pay several kinds of credit card transaction fees:

  • Interchange fee: This is collected by the card-issuing bank.
  • Network fee: This small fee goes to the card network (i.e. Mastercard and Visa)
  • Assessment fee: This goes to the card-issuing brand. For example, for airline credit cards the airline collects an assessment fee each time the card is swiped.
  • Processor markup: MSPs assess this fee to generate revenue. The processor markup can be where a lot of extra fees are assessed (account fees, 24/7 support fees, PCI compliance fees, etc)

Second, your MSP could use one of these two pricing models:

  • Tiered pricing: A bundle pricing model, MSPs use tiered pricing to segment payments (non-qualified, mid-qualified, qualified). You pay the highest fees for non-qualified transactions. While tiered pricing can seem inexpensive at first glance, many house painters and other contractors discover a lot of transactions end up on the higher end of the fee ranges.
  • Pass-through pricing: This model has a less complex fee structure. You simply pay a fixed interchange fee, a variable fee, and the MSP markup.

Whether you’re a house painter or repair worker, pass-through pricing offers more simplicity and transparency. You know what you’ll pay, and it’s most likely lower than tiered pricing structures you’ll find. So, how do you get the best mobile credit card processing and take home 100% of your revenue as a house painter or contractor? Start by following these steps:

  1. Shop and compare the best mobile credit card processing companies. Do your research. Reading this guide is a good start. You can also read our guide on the best credit card processing for small businesses. From PayPal to Fattmerchant to Square, there are lots of options for contractors like house painters. See who has the lowest fees and can offer the capabilities you need. Select the best three you find for your business and move to step two.
  2. Try to lower the MSP markup! While you can’t tell Bank of America or Visa you want lower interchange fees, you can negotiate the MSP markup. We’ve seen mobile credit card processing companies drop their markup fees by 5-10%. So, it’s worth asking!
  3. Choose the best mobile credit card processing provider for your operation. For your work, that should be the MSP that has low fees, quality hardware and software, and excellent customer support.

Implement a cash discount program and bring home 100% of your revenue as a contractor

Having the best mobile credit card processing as a house painter, HVAC specialist, or other independent contractor consists of one more step: Implementing a strategy to eliminate fees altogether. Enter the cash discount program. As the name would suggest, a cash discount program involves giving customers who pay in cash a discount. At NadaPayments, for example, our cash discount program for house painters gives customers a discount of up to 3.95%. On a house painting job worth $3,000, that’s a discount of $118.50. Surely that would convince many customers to pay in cash. If your customer still decides to use a credit card, the’ll just pay the full price of $3,000. Since that price already accounts for card processing fees, you’ll receive full revenue from your work as a house painter.You may be asking yourself: Are you allowed to give cash discounts? The answer is yes. A cash discount is 100% legal and compliant, thanks to the Dodd-Frank Act. Interested to learn more? At NadaPayments, we’re ready to help contractors get the best mobile credit card processing with a cash discount program. Call us at +1 (929) 293-1800 or click the link below.

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