"If you don't stay, I'll hurt you." Sounds horrifying, right?
But that is what MANY merchant services companies (the companies who provide credit card machines and the service to businesses so they can accept plastic) demand from small businesses in America. It makes about as much sense as Finnigan's Wake. Seriously. Read 2 pages of that preposterous novel. One survey found that 100% of people who claimed to understand it, were lying (JK, not kidding).
But really, early termination fees are on par with that level of nonsense! They're basically an abusive relationship. Merchant services/credit card terminal processing services companies who demand that your shop remain with them for a specific period of time are abusing American businesses. That is harmful to the economy as excessive fees contribute to the estimated 80% failure rate of new businesses according to Fundera.com.
In 2013 a Portland dress shop was informed they owed a bit over $1400 (not from services rendered) to close their old credit card terminal processing account.
Let's all put a stop to this! If a merchant services sales rep asks you to sign a contract with an early termination fee, then he is asking you to stay under threat. Why give that kind of power over you and your business to someone else?
Anyone requiring a fee to close your account is telling you in advance that they will be terrible to you and your business. They are literally saying "I need you to stay with me regardless of my service quality, because if you leave I will punish you." And these are companies given direct access to your business checking account! They won't send you bill hoping for a check. They'll just debit your account and laugh all the way to the Bentley dealership.
So please, never sign an agreement for credit card processing that demands you stay for a preset period of time with financial consequences if you don't. It's just silly! Loads of companies offer other options.
Sign up with my company or ANYONE ELSE who won't demand a contract.
Seriously, I feel like this should be on Last Week Tonight with John Oliver. But perhaps too small a portion of the population own small businesses.