How to Choose the Best Payment Processor for Your Dealership

By Mike Freeney, Regional Manager for Electronic Merchant Systems

The pressures that independent car dealerships are under in 2023 can sometimes feel daunting. The industry has dealt with a pandemic, dwindling inventory, and higher prices in the last few years. With these challenges, however, has come innovation. Even as buyers are more open than ever to the idea of internet transactions for large purchases, they will still interact with car dealerships often. This is where your payment processing comes into play. It is crucial to find a partner that understands your needs and can effectively communicate their benefits. In this article, we’ll look at a few considerations when choosing a payment processor for your dealership.

Point Of Sale Reliability

Because dealerships offer a unique set of payment processing challenges, finding the proper point-of-sale hardware can take time and effort. Any system you choose will need to handle large purchases and recurring payments. Simplicity is paramount whether payments are made over the phone, online through email invoices, or in person. A quick and feature-packed system will foster customer loyalty and make payments easier for your staff.

Mobile Payments

Mobile payments should be a consideration when choosing a processing partner. Remove an extra barrier and allow customers to pay on the lot with a mobile card reader. Just use your phone and accept card payments faster than ever. When you meet more payment needs, you bring in more customers looking for flexibility in their payment options.

Virtual Terminal

The used car business is changing rapidly, and it is more important than ever to meet your customers where they are. A virtual terminal is an interface built into a payment gateway that will allow you to take payments through any webconnected device. This secure solution will handle recurring payments efficiently and help you set up an automatic billing schedule at the time of purchase to make the payment process a breeze for your customers. It is also crucial to look for security in a processing partner. Your buyers are making a massive purchasing decision, and alleviating security worries will create loyal customers.

Fees And Rates

Every dealership wants to avoid high processing fees. Profits are already slimming, and the last thing you need is a card processor wiping out your gains. When comparing processors, there are several fees to consider. Chargeback fees, setup costs, and monthly fees are a few that you’ll need to add up for each processor to get a clear picture of your monthly cost. Negotiating and researching the best rates will ensure you make as much money as possible while letting your processor work in the background. Receiving the lowest rates is vital when handling large transactions. Unfortunately, some payment processors are less scalable, and fees add up quickly. Requesting a rate review can guarantee low rates for your dealership and peace of mind for your customers, who won’t have exorbitant costs added to their transactions. This will allow you to view your current rate side by side with the rate being offered by any potential processor and make a decision with ease.

Determine which pricing model works best for your dealership. Using an interchange-plus pricing model, you will pay the interchange rate required for each transaction plus a markup for other fees. A flat-rate pricing model gives one rate for each transaction type, covering all services and fees. The best pricing model for you greatly depends on the transaction types you accept most frequently.

Customer Service

You don’t have time to deal with payment processing issues. Time is money, and even a few hours without service could be costly. Your payment processor should be available 24/7/365 with no exceptions. Having a team dedicated to your wellbeing at all hours will give you peace of mind when driving over road bumps. Compare Google Reviews of various processors to verify that their team is knowledgeable and always available over the phone to help your dealership. n

Mike Freeney is a Regional Manager for Electronic Merchant Systems. EMS has over 30 years of merchant services experience and is the largest independently owned credit card processing company in North America. We are proud to be a PIADA partner and provide top-tier payment processing to used car dealerships in the Pennsylvania area.