Auto dealerships invest significant time and money in attracting customers and closing sales. But when payment approvals become difficult, even a completed sale can create unnecessary work and expense.
One dealership experienced this firsthand. After switching check guarantee providers, the dealer estimated that declined checks dropped by approximately 80% and processing costs fell by roughly half.
The experience illustrates why dealerships should evaluate their entire payment process, not just transaction rates.
When Payment Declines Become a Dealership Problem
The dealership's previous check guarantee provider created several challenges: frequent declines, cumbersome approval procedures, and extensive paperwork to obtain reimbursement for returned checks.
These obstacles affected more than processing costs. Employees spent valuable time resolving payment issues, while customers sometimes faced delays or needed to arrange alternative payment methods.
Rather than simply searching for a lower rate, the dealership evaluated its overall payment process.
After switching to CrossCheck, the dealer reported:
- Approximately 80% fewer declined checks
- Processing costs reduced by roughly half
- Significantly less employee time
These dealer-estimated improvements demonstrate how the right payment provider can help reduce administrative work while making transactions easier to complete.
CrossCheck's Charles Dortch III shared this example during a Car Dealership Guy Daily Dealer Live conversation.
The True Cost of Getting Paid Goes Beyond Processing Rates
Transaction fees are only one part of a dealership's payment expenses. Frequent declines, complicated approvals, and time spent resolving returned payments can add costs that aren't reflected in the processing rate.
When evaluating a payment provider, dealerships should consider:
- Approval experience: Are legitimate customer payments being declined unnecessarily?
- Employee time: How much work goes into resolving payment problems?
- Financial protection: What happens when a payment is returned, and how straightforward is the reimbursement process?
- Processing costs: What is the total expense of accepting payments, beyond the advertised transaction rate?
A lower processing rate doesn't necessarily mean a lower overall cost.
Why Dealerships Should Evaluate All Their Payment Options
Check approvals are only one consideration. Dealerships should also evaluate how their payment methods affect customer convenience and operating expenses.
Credit card transactions, for example, can create a financial trade-off. The dealership may absorb processing fees or, where permitted, pass some of those costs to customers through a surcharge.
On a $5,000 payment, a hypothetical 3% credit card processing rate represents $150 in fees if the dealership absorbs the cost.
Other payment options can help dealerships manage these expenses:
Pay-by-Link: CrossCheck's Pay-by-Link uses ACH with open banking to let dealerships send secure payment links by text message or email. Customers connect their bank accounts to initiate payments without relying on credit cards, providing a convenient, potentially lower-cost alternative.
Check Guarantee: Dealerships can accept eligible checks with protection against covered returned payments, reducing financial risk while accommodating customers who prefer paying by check.
Offering practical alternatives helps dealerships balance customer convenience, processing costs, and payment protection.
Evaluate the Entire Payment Process
Dealerships routinely review advertising expenses, inventory costs, and sales performance. Payment processing deserves the same attention.
Are legitimate payments being declined? Are employees spending unnecessary time resolving issues? Do your payment options accommodate customers without creating excessive costs?
The answers may reveal opportunities to improve efficiency and the customer experience.
Getting paid should support the sale, not create another obstacle.
CrossCheck helps auto dealerships accept payments through ACH with open banking and Check Guarantee, giving dealers practical alternatives for completing transactions while managing costs and financial risk.
Explore CrossCheck’s Payment Solutions for Auto Dealerships