Cancelling a merchant account early can be an expensive business. In many cases it will cost you £100-£200 to cancel early. Often these charges come as a surprise to the merchant who may have been with the same provider for years. This article is going to share with you some top tips for avoiding these fees.
Before You Sign The Contract
- Always ensure you ask the bank or their representatives about the early cancellation fee. Find out if there is one, how much it is and when it expires. If a rolling contract will automatically come into place when the fixed term reaches its end, find out if that will include an early cancellation fee and how much it will be.
- As well as asking the bank, make sure you read the small print to see what it says there. Make sure you have the complete contract and go through it with a fine tooth comb.
- If you are smart you will be negotiating costs for your merchant account to get the best deal. Try to see if you can get the early cancellation fee removed or reduced and if you do make sure you get it in writing and the contract is amended.
- Check forums. One handy thing about the internet is you can get info ‘from the horses mouth’. Take a look at popular business forums to identify any potential pitfalls and see if anyone has any advice about how to eliminate the early cancellation fees. Forum contributors may be able to suggest banks who don’t charge one.
If You Decide To Cancel
If you decide to cancel your merchant account early and are aware a cancellation fee looms, there are a number of steps to consider to try to get out of the fee.
- Contact the bank where you have your checking account. It may be that the merchant acquiring bank has access to make withdrawls. If you wish to dispute the fee let your bank know to block their attempts to make a withdrawl, if that means closing down the checking account go ahead, you are cancelling anyway.
- Prepare to make your case. Take a look to see if fees have increased any time over the past 3 months, that might give you legal recourse against the cancellation fee. If you are going out of business there may also be legal protection against the fee.
- Approach the bank with your case set out. For example, show them how much you have paid in fees during the course of your contract, if you have always kept your account up to date make sure they’re made aware of that. Merchant acquiring banks are more aware than ever that customer care is paramount. They don’t want a lot of bad publicity online about unfair charges.
Ultimately, if you have signed the contract it may be at the discretion of the bank to waive the fee so make sure you take all necessary measures before you sign. If it looks like you might have to pay try to avoid getting into a confrontation with them.
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