CC processing fees

Discussion in 'The Think Tank' started by URNUTS, Nov 22, 2017.

  1. URNUTS

    URNUTS Active Member

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    I was over 90%
    I remember going to the bank 10, 20 years ago with tons of cash and being nervous, two people, lots of cash, etc.
    Last 8 years..... almost a joke $3500 night and the cash deposit was $100!

    Thanks, Steve... forgot you were 2.3%
     
  2. Daddio

    Daddio Well-Known Member Moderator

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    I now have days that I have to dig into the till float to pay the drivers tip-out.
     
  3. Gunner

    Gunner New Member

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    ....when Credit Cards used to be for emergencies, now Cash is...
     
  4. paul7979

    paul7979 Well-Known Member

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    Nowadays, the credit card companies rob you for more than the crackheads ever imagined getting you for.
     
  5. Steve.L

    Steve.L Active Member

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    Hello,
    Here is some information which hopefully will help all of you :)
    I used to work with few processing companies and from what I can tell, Heartland is one of the best options if not the best one. (No, I never worked for Heartland). From what I have seen Heartland has the most transparent pricing and low rates.
    • [IC Plus or Pass-thru or Cost+] All refer to Interchange Plus Pricing. What does that mean?
    It means that all rates as they have been set by Visa, MC, Discover & Amex are being passed to you directly without any changes. You are being charged the rates for every card you process as they are posted online at every major card issuer website. You can look it up. That is the "Interchange" part of the term.
    Then it comes the "Plus" part where the processing company makes their money. Whatever you're being charged for the "Plus" part, you can negotiate in order to get better rates. The "Interchange" part of the fees is NON-NEGOTIABLE.
    In other words, when they offer you a 0.35% or 35 basis points and a $0.05 that translates to:
    0.35% per $ processed + 5 cents per transaction, on top of what the interchange fees are.
    Then you have to take into consideration the PCI Compliance fee, the monthly penalty fee for not being PCI compliant, the AVS Fee (Zip Code Entry), the monthly account fee (if any), the support fee (if any), the statement fee, the batch closure fee, the batch settlement fee, the any unidentified fee, and any other fee you can imagine!
    With interchange plus, when your Keyed volume is over 30%, ONLY the "Interchange" rates change and not the "plus". If the "Plus" fees change, you can always request a rate review to bring them back to what it was.​
    • [Tiered Pricing] AVOID!
    As sweet as it sounds to you when they tell you'll get 1.69% + $x.xx per transaction for qualified transactions, you don't get the whole story that it will be another 1+% + $x.xx per transaction for mid-qualified and an extra 1-2% + $x.xx per transaction for non-qualified transactions, totaling a 3.5% to 4+% and have you wondering what did you signed up for.
    Plus, here the whole rate changes if you go over 30% of your transactions being keyed-in.
    Of course, besides the tiered pricing all other fees mentioned above (PCI, AVS, etc.) are all extra charges.​
    • [Debit vs Credit Cards] Should you accept debit cards using a pin-pad?
    Debit cards have lower rates as they don't include any risks since the money is already available in the card holder's account. That said, debit is not for everyone! Especially in a fast paced environment like pizza shops & deli shops where customers line up. Every second counts there and you don't want to have to wait for your customers to figure out how to use your pin-pad. This changes if you have a convenience store or any other non food related store.
    As for the rates, while they might be cheaper when using debit & pin-pad, the agent who works for or with the processing company might charge you up to 25 cents per pin entry! So that defeats the whole purpose.
    Regardless of which processing company you're using or going to use, keep the above information in mind and pay attention to the contracts.

    AND IN NO CASE, NEVER LEASE EQUIPMENT! YOU CANNOT GET OUT OF A LEASE AGREEMENT!

    I apologize for my very long post, and I really hope It will be useful to many of you :)
    Good luck to all!
     
    Last edited: Nov 28, 2017
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  6. bodegahwy

    bodegahwy Well-Known Member

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    Ouch! I have not had $850 total in charge backs since we started taking cards about 10 years ago. We do about your monthly volume per year and have maybe $50 per year in charge back transactions.
     
  7. URNUTS

    URNUTS Active Member

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    Appreciate that info.
    "Keyed" is manual entry.... as opposed to swiped, correct?
     
  8. Steve

    Steve Active Member

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    Correct


    Sent from my iPhone using Tapatalk
     
  9. pizzapiratespp

    pizzapiratespp Well-Known Member

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    3 years ago the California public voted in laws regarding what is a felony and a misdemeanor. Any property crime must be over $950 value in order for it to be a felony. Less than that its a misdemeanor and the police will take no action. You can steal $949 at a time all day, every day and there is no consequence. The good news for us is that there is very little money in stealing pizzas and trying to re-sell them to people, so they focus more on stuff they can sell on craigslist.

    The best charge back we ever had was a group of high school kids who ordered 50 pizzas to sell for a fundraiser. The teacher/adviser of the group put it on her credit card and collected the cash from the event. She then reported that the charge was fraud and walked off with $500. This teacher was a regular customer and had ordered from us for years. I spoke to her personally regarding the charge back and she told me it was an error on her part. The CC company still sided with her and considered an un authorized charge. That was the last charge back I fought.
     
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  10. bodegahwy

    bodegahwy Well-Known Member

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    I would take that straight to the school. In Colorado that would be considered walking out without paying and is subject to 3X the amount of the ticket.
     
  11. URNUTS

    URNUTS Active Member

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    To the school, the local paper and then a brick through her window.
    Back in '94.... when I bought my first Domino's store we took checks. Guy bounced one and I called, stopped by, etc
    I don't eat for free, and I don't feed people for free.
    So.... being young and stupid.... I went to his house to give him another chance. He wasn't home and I noticed a very nice TV which I took, leaving a note in its place that said "if you'd like your TV come to Domino's and pay your bill"
    And he promptly did!
    Oh, to be young and stupid again. Now I'm only one of those.
     
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  12. pizzapiratespp

    pizzapiratespp Well-Known Member

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    That was a younger me. Now I just bend over and take it. I don’t have the energy anymore.


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  13. URNUTS

    URNUTS Active Member

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    Me, too. Not so sure I'd pull that one again!
     
  14. LittleMissPizza

    LittleMissPizza Member

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    I'd urge you to check out FattMerchant or Payment Depot, they are both membership models (pay a flat monthly fee) and then each CC sale is just charged a flat swipe fee (5 cents). When we get our monthly statement I simply divide our fees by our total amount processed and arrive at a percentage, ours is currently at 2.2% INCLUDING the monthly membership fee. I like the fact they are transparent and you can easily read the bill, there are no industry terms to try and confuse the end user (see previous/above comments).
     
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  15. Mondo

    Mondo Active Member

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    Which one do you use and how long have you been using them? What do they charge per keyed in transaction? I read up a little bit on those newer types of pricing models but honestly, just seemed too good to be true.
     
  16. Steve

    Steve Active Member

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    My question regarding FattMerchant is, are they truly showing you all your fees, including interchange? When they quoted me including interchange, it was more around 3.25%. Vantiv has me at 2.3% and that includes everything.

    I checked out FattMerchant on LittleMissPizza’s suggestion a few months back but the numbers didn’t add up for us, but if that’s what you’re truly getting, then that is pretty fantastic.

    One thing with FattMerchant is that they don’t integrate into all POS platforms so if that’s something important for your day to day processes be sure they integrate. We hated having external CC machines in years before Speedline.


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  17. URNUTS

    URNUTS Active Member

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    Just looked into fatt on line. Lots of reviews and mostly all quite good.
    Under 1 million/year is $99 month and .08/trans plus interchange fees... flat. That's it. From what I read.
    Over the million is .05 and 200/month, if I remember correctly.
    Interesting.
    I looked into North American Banc Card.... some seriously scary reviews. ALL of them.
     
  18. RPCLady

    RPCLady Member

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    We signed up for Elavon with a Costco membership. what I hated was after the chip card requirement came in play was the cost of the terminal. So we're stupid because we are leasing the terminal, we could not justify paying $500 for a machine that previously was provided free with our merchant account. Go figure. We're happy with the service, we've had it a year now.
    Just thought I'd share what we're using.
     
  19. Mondo

    Mondo Active Member

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    2.5% effective rate in my first full month with Vantiv.
     
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  20. Steve.L

    Steve.L Active Member

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    2.5 is really good. Just keep watching your monthly statements to make sure you keep it that low.