Many merchants believe they have overpaid for their credit card processing! So how do you know if you are paying too much?

The BEST way to know what you are paying monthly for processing credit cards is to divide the total fees taken from your bank (shown on your merchant statement) and divided your total sales volume. This gives you the Net Effective Percentage which includes all fees, not just the rates!

After Net Effective, you should check your monthly statement to see if Qualified, Mid-Qualified and Non-Qualified is labeled. These are associated with the tiered pricing model which is the most expensive processing method.

Many processors use interchange plus pricing instead. This kind of pricing method passes the wholesale rates from the brands (Visa, MasterCard, Discover & American Express) on to merchant and the processor adds a negotiate percentage to that rate. Merchants can negotiate this flat rate. You always know what you are paying your merchant processor. Compared with tiered pricing, interchange plus pricing is much less expensive.

If you are using a flat rate processor, like Square or PayPal, there is a good chance you’re still overpaying! Flat rates fees are simplified fees but do not take into consideration the lower rates for debit cards. There in-person rate is 2.75% or more and in-person with a debit card can be ONLY .50%!! These types of companies have no monthly fees but get you on the rates! If you are processing more than $3000 a month with higher than $25 transactions… we should be talking!!

Finally, today’s merchant is saving money by passing along the processing fees to their clients instead of raising the costs of goods and services!

The following methods are legal and available:

– Surcharge Fee Method

– Convenience Fee Method

– Service Fees Method

– Cash Discount Method

It is important to keep in mind that Merchant Processing Solutions Inc., is a local South Florida company that helps you find the right solution in the most cost-efficient way.

Call us today! 954-938-2024