CC processing fees

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

  1. SolutionsGal

    SolutionsGal Member

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    Full disclosure, I am a provider of merchant services. YES you want pass thru, NEVER Tiered pricing. 0.35% basis points is not 3.5% . Depending on your volume, $0.05 per swipe is not unreasonable. What I didn't see is the other fees, e.g. Statement fees, annual fees, PCI fees, and all the other fees that may not be fully disclosed in the contract but will be in the terms and conditions, these can add up to hundreds of dollars. Even if I don't get your business, I am always available to answer questions or review contracts before you sign. Here is an example for basis points: $20,000 x 0.35%=$70.00, this is the markup or profit the provider is making above pass thru pricing. Remember that a provider can only negotiate off the profit that they make, Interchange is set by the card brands and is set in stone. You can drive yourself crazy trying to find ways to reduce your fees. The best way to gauge your rate is to track the effective rate. To calculate your effective rate is simple, take your total dollar amount of fees and divide it by the total amount of volume, this will give your effective rate. You want to be as close to 2% as possible.

    Best wishes for your new venture!
     
  2. Steve.L

    Steve.L Active Member

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    Or start accepting BitCoin. 1% flat fee, no PCI-Compliance, no chargebacks, no BS. And the money deposited directly to your bank :)
    Bitcoin IS the future!
     
  3. URNUTS

    URNUTS Active Member

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    The more I hear about it, the less I understand it.
    I think that, conceptually, I don't get it.
    I read an article this AM talking about S. Korea, Indonesia and BC.... regs, banking issues, etc.
    I think that- at my very core- I'm not a trusting person.... and I say that with a smile. And a bit of honesty.
    I like to see, feel and understand things.... the curse of being old, I suppose.
     
  4. SolutionsGal

    SolutionsGal Member

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    I think we all want to understand things that affect us financially! It is so important to have a provider that doesn't charge a cancellation fee, that way if you aren't happy with the support or fee structure, you can exit without any penalty. I always ask my merchants one simple request, please communicate with me! I can't read your mind, and I can't fix a problem if I don't know it exists. When you find a provider like that you will be much more confident in your choice.
     
  5. Steve.L

    Steve.L Active Member

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    Last edited: Dec 11, 2017
  6. LittleMissPizza

    LittleMissPizza Member

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    Sorry for the uber delayed response. We use Payment Depot and have done so for about 6 months and have been hugely happy with them. I originally was made aware of FatMerchant and then in doing my research came across PaymentDepot which offered us a slightly better deal. As far as keyed transactions go, I'm not exactly sure of that rate as we do fewer than 20 keyed transactions a month since we have mobile readers for our drivers. I thought the same thing as you when I first came across these type of processors but they have delivered what was promised and we couldn't be happier. If you do decide to go with them, make sure you tell them you were referred so you can get their 20% referral deal they have going on to save yourself some money!
     
  7. Mondo

    Mondo Active Member

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    What does your effective rate with all fees come out to each month?
     
  8. famousperry

    famousperry Active Member

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    I have been at 2.4% and just switched to a company that joined my food co-op that quoted me approx 2%...sounds too good but I can opt out any time so I have nothing to lose
     
  9. LittleMissPizza

    LittleMissPizza Member

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    Last month was 2.1%. I arrived at this number by taking total amount of any and all fees divided by amount of credit card transactions from our bill.
     
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  10. URNUTS

    URNUTS Active Member

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    Well.... that sounds awfully good to me.
     
  11. bodegahwy

    bodegahwy Well-Known Member

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    No thank you. Never been asked for it. Not interested in a currency whose value is a moving target from minute to minute. Eventually gravity wins.
     
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  12. Steve.L

    Steve.L Active Member

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    Oh I know, trust me... No matter how much I want to like the idea of it, the actual thing is far from ideal. But, no one is going to ask the public's opinion (mine, yours etc.) when they force it! and they will!
    Visa, MC, even Bank of America are on board with bitcoin, so it's coming regardless of what we want.
    As it stands right now, is good. It doesn't affect you as a merchant in any way because while you can accept it, you don't have to accept it as bitcoin but you can automatically convert it to $$ and deposited to your bank account just like all your other transactions. That is until the highest percentage gets on board willingly. The rest will have no choice then!
    Bitcoin is just the first of many...
     
  13. URNUTS

    URNUTS Active Member

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    From bitcoin to driverless cars- both of which are, IMHO, over promised and over promoted.... I'm glad I'll be dead soon.
    I'm still waiting for the home robots and flying cars we were promised on the cover of Popular Mechanics!
    That said, they will probably be here soon enough. Glad I'll miss them.
     
  14. Steve.L

    Steve.L Active Member

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  15. pizzapiratespp

    pizzapiratespp Well-Known Member

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    . They’ll probably send a driverless car to come scoop up your lifeless body.


    Sent from my iPhone using Tapatalk
     
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  16. KarnaEyden

    KarnaEyden New Member

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    Nice info.
     
  17. LittleMissPizza

    LittleMissPizza Member

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    Just wanted to pop back in while it was top of mind to give you all an update, we are still processing with Payment Depot and our rate has been 2.1% each month since posting this thread. I know personally, I always like to hear updates of these sort of things 6-12 months down the road to see if the company has delivered on their promises. Just to be clear I have zero ties to Payment Depot but wanted to provide an update. :)
     
  18. Steve

    Steve Active Member

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    2.1%? This can't be true. Interchange is up to what 1.9% this year?
    Sent from my Pixel 2 using Tapatalk
     
  19. royster13

    royster13 Well-Known Member Moderator

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    The interchange rate depends on type of business, volume, etc., etc...On Mastercard's list, "hand keyed" is 1.89% plus 0.10.....Some processors operate on "razor thin" margins.....
     
  20. Steve.L

    Steve.L Active Member

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    The "Interchange" part, does not depend on any business type or volume!
    Interchange rates are posted annually, they are different per card brand/association and only depend on the type of cards issued and type of transaction (Swiped vs Keyed).
    They are set rates for a duration of a year and do not change based on business type or volume. That is the "plus" part of the Interchange Plus term.
    "Plus" stands for the added charges of the processing company to the merchant, where the company makes its profit.