Saving Money on Credit & Debit Transactions Focus of ABA Education Session

Michael Barnard of Rakestraw Books in Danville, California, recommends booksellers be proactive in handling credit and debit card transactions. He'll discuss managing the complicated fee structure of credit and debit cards to reduce risk and save money at "The Business of Accepting Credit & Debit Cards," an ABA Day of Education session, on Tuesday, May 25, at at BookExpo America.

"There are many things that affect our financial health that we can't control," said Barnard. "But managing credit card transactions is something you can control, and it aggregates out to be a discernible amount of money. I know how hard I have to work to make $1,000, and if I can do something that will save a thousand or a couple thousand dollars a year, it's worth doing."

Another point that Barnard underscored is that while careful data handling can add to the bottom line, lack of security compliance could derail a business. "Failure to comply can lead to massive fines and business interruptions," he said.

Every credit or debit transaction carries a fee, and it's important for retailers to know what their credit card processor charges for each.

For transactions of around $20 or more, the least expensive option for the retailer is usually a debit card transaction where the customer enters a PIN number, as opposed to a credit card transaction requiring a signature. Barnard said that his staff is trained to encourage customers to use their PIN numbers if at all possible. "When a customer presents a debit card, staff just hands them the PIN pad. Customers rarely question it, and they're much less likely to question it if no one asks them."

Another way to cut costs is to find a processor offering better rates. Barnard recommends that booksellers seek bids from different companies and a re-bid from their current company. If you tell your bank you're going somewhere else, chances are they will try to keep your business, he said.

One more tip: "I just learned this recently," said Barnard. "It's essential to batch out on a daily basis. Failure to do so can add one percentage point per transaction, and it's a simple thing to avoid."

When it comes to the kind of terminals a bookstore uses, Barnard noted that to minimize costs booksellers should educate themselves about the hardware they need, and what they don't need. "Some retailers think they need to get a PIN pad for debit card purchases," he explained. "But we just take the credit card terminal and turn it around [to face the customer] and let them key in their PIN number."

To learn more about credit and debit card best practices, come to "The Business of Accepting Credit & Debit Cards" on Tuesday, May 25, from 12:45 p.m. - 2:15 p.m.,in Room 1E11 at the Jacob Javits Convention Center. ABA's Day of Education is sponsored by Ingram. --Karen Schechner