3 Fees To Evaluate Before Signing Up For Merchant Credit Card Processing

Companies that offer merchant credit card processing arent providing a service out of the goodness of their hearts

. They make their money by charging some pretty significant fees for each and every action you perform on their machines. Deciding which merchant account or credit card processing provider to use requires a bit of math, evaluation of alternatives and solutions, but any budding entrepreneur should be able to assess these three common fees.

Transaction Fees

You can expect to pay a fee for every single transaction your run through your machine. Swiped transactions are generally less expensive than those that are sometimes keyed in due to a faulty reader and those specifically required to be manually keyed in. Wireless transaction fees are also higher, and if you opt to accept debit cards as well, those fees are significantly more.

Discount Rate

Simply put this is the percentage of each transaction you pay for the pleasure of accepting credit cards. Okay, maybe not pleasure, but convenience fee to allow customers another option to pay. For example, if your discount rate is 5% you will pay $0.05 of each dollar as your fee.

Monthly Fee

Usually a fairly small fee, about $10-$15 per month, the monthly fee is what gives you access to customer support and provides a written statement of your activity. It is a fixed fee that is not affected by the number of sales you make.

Other Fees

There are several other fees you can expect to see when a company offers you a proposal regarding your merchant account services. A gateway fee is common for Internet businesses, a monthly minimum fee covers your provider if you do very little business during a particular month, and a batch fee may be charged daily for processing all of your payments. Look for any and all potential fees when assessing an offer.

How to Find the Best Deal

If you plan on running many, small transactions you will probably do better with a lower per-transaction fee and a higher discount rate. If you anticipate few, large transactions, the reverse is likely to be true.

Determining the best deal will be a simple matter of mathematics. Once you have the numbers, making the right choice is easy.

by: Michael Rupkalvis

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