Why "Free" POS Offers are Never Free
If you own a business and use a point-of-sale system, chances are you’ve seen the recent wave of POS companies offering huge incentives to switch platforms.
Companies like Toast, Shopify and SkyTab POS are heavily advertising offers like:
- “Get Paid to Switch”
- Free hardware and terminals
- $5,000 Processing credit bonuses
- Thousands off equipment costs
At first glance, these deals sound incredible. But before you commit your business to one of these platforms, it’s important to understand what may be hidden behind the marketing.
There’s an old saying in the payment industry: “Free money is never truly free.”
In many cases, POS companies recover the cost of “free” hardware through:
- Increased processing fees
- Higher monthly software costs
- Contractual pricing changes
- Add-on fees for support and hardware changes
The upfront bonus may save money today, but over time those costs can quietly come back through rate increases and hidden fees.
Why You Should Be Careful
When signing on to one of these heavily promoted deals, in most cases you do not get the option of a Rate-Lock. What that means is your rates and fees are subject to change at any time.
Every year in April and October, the credit card companies like Visa, Mastercard, Amex, and Discover review their Interchange rates and alter them slightly. When this happens, POS companies like the ones offering the bonuses use it as an opportunity to raise rates on all card types regardless if there is an actual change to the Interchange rate. Here are a couple examples of customers of the POS companies showing this year was no different - Shopify and Toast.
Long-term contracts also come into play as most of these too-good-to-be-true deals come with a 2-5 year contract with extensive terms and conditions. Signing a contract causes your business to be locked in to POS software, hardware and processing fees no matter how much card volume your business submits or if you switch away from their services. The $5,000 bonus acts like bait, and then your business is stuck with the service and fees until your contract pans out or you pay a substantial early termination fee.
The PolyPay Difference
At PolyPay, we don’t believe in this. We like to practice what we call Ethical Processing - making sure that our service is a win-win situation for everyone involved. We are in the business of providing reliable and cost-effective services for our merchants, on top of:
- No contracts
- Locked Rates & Fees
- In-House Support
What we offer is simple, but in this industry it’s unheard of. We designed PolyPay to be a business that supports businesses - not the other way around.
If you are trapped in one of these “POS specials" or "bonus deals,” contact us today so we can help you see the light at the end of the tunnel.
