Swapping POS systems is hard. It’s the nervous center to your business, and when you have hundreds of locations and thousands of employees, moving a POS is no small feat.<\/p>\n\n\n\n
It’s why POS companies that mandate (hint: lock-in) payments have been relegated to SMB: nobody with a brain wants to be held captive to their payments provider.<\/p>\n\n\n\n
Because historically, payment processing has offered less than no value, and payment processors are one step below used card salesman on the list of slippery characters.<\/p>\n\n\n\n
Now, there actually IS value in bundling POS and payments data, but payments companies don’t invest enough (i.e. anything) in R&D to show this value, and POS companies are too often fighting 1,000 battles (and getting paid nothing for their efforts), so they don’t have the bandwidth to demonstrate this value either.<\/p>\n\n\n\n
If a merchant IS to choose to bundle their payments from their POS provider, they need to demand this clause…<\/p>\n\n\n\n
Most – if not all – payment processors put language in their agreements that allow them to increase fees with some de minimis notice. 30 days is standard but we’ve seen some agreements that allow for carte blanche increases whenever the processor feels like making even more money for nothing.<\/p>\n\n\n\n
In principle, the card networks increase rates twice per year. Most merchants should be on interchange plus pricing, and when that’s the case it’s reasonable and fair that the processor pass through interchange costs (not padded<\/em> interchange costs, but actual<\/em> interchange costs) when the networks make those changes.<\/p>\n\n\n\n But for all other discretionary fee increases that processors make to juice their own profits?<\/p>\n\n\n\n Nope.<\/p>\n\n\n\n They shouldn’t be allowed to increase those costs.<\/p>\n\n\n\n At a worst case they should be required to give a 90-day notice.<\/p>\n\n\n\n Business costs can increase in time, but processing costs frankly shouldn’t: the cost to support accounts should go down for anyone who understands technology. That processing bills go up is a function of avarice, not true business costs.<\/p>\n\n\n\n Replacing a POS is too hard. Don’t let your POS provider get the better of you with shitty contract language on their payments offering. <\/p>\n