23 Mar Next Day Funding for Merchants: What Does It Cost?
They say patience is a virtue, but waiting for money to be deposited into your merchant account doesn’t make you feel particularly virtuous.
Waiting extra days to see that money hit your bank account can be agonizing, and sometimes you need access to that cash quicker than a few days.
So many business owners wonder if they should try and apply for next day funding. But many have no idea what it costs or if it’s beneficial to their business.
How do you get next day funding?
You’ll have to get in touch with your processor and work with them to see if it is available and if you can even get next day funding.
Businesses like bars and restaurants don’t usually qualify for next day funding because there’s always a very specific timeframe to submit the transaction batch. The batch time depends on the time zone the processor is in and varies per processor.
For instance, bars and restaurants do not usually close until 2 (though it varies by each state). Therefore, they don’t settle their transactions batch until late that night. For your business to receive next day funding, you need to be able to submit usually before 10:00 PM EST.
When your business’ money is deposited in your account has to do with the funding cycle that is run by processors and banks. Banks tend not to run 24/7 when it comes to approving payments.
For the transactions to settle, your business needs to settle early enough for the money to be available the next day.
The best way to see if next day funding is available is to call your credit card processor. They should be able to see if your business can sign up and walk you through the steps.
Is next day funding worth it?
Next day funding can cost extra fees on top of your current processing rates. Usually, the price is .05% per batch.
So is it worth it?
Depending on your business, next day funding is beneficial for merchants with heavy weekend sales volumes. You can look at your processing statement, and do some simple math and figure out how much that’s worth it to you.
For some businesses, the extra fee to have cash faster than 2-3 days, is worth it.
Interested in a rate check?
Are you looking for a better deal on your processing rates? Contact us today for a free price check, and know if your business is overpaying for processing services.