Cancellation Fees, Termination Penalties:  This one’s understandable but completely unnecessary and cruel. This is a free country and free market economy. If you don’t like your Processor’s service or rates, you should be free to go with another Processor.

A Cancellation Fee attempts to stifle competition by penalizing you for not being satisfied with them!  One excuse they use is that they incur considerable expense by taking you on and this is a reasonable attempt to recoup the loss.

The only real expense incurred is if your Processor has provided free Terminals, Software, Paper Rolls, Labor for Installation or Gateway Setup Fees. However, many charge you for these things and most Processors recoup those expenses from the fees they charge you after 3 months of processing.

Many processors will have wording in their contract which is even double-talk:

“You understand you will be charged $295 if you cancel service within X years and agree not to call this charge a penalty or cancellation fee.”

Never, ever agree to a cancellation fee. Remember, everything is negotiable!