subject: Merchant Processing Payment Service Options [print this page] Merchant Processing Payment Service Options
In order to be able to opt for the most suitable credit card processing solution and the best payment service provider, it is important that you understand the various merchant account pricing models. The following will give you a clear picture of the most cost effective pricing structure for businesses merchant processing.
Payment Services Pricing Structures
The pricing structure of the payment service you opt for will tell you how much your merchant account provider stands to gain from your business and sales and how this will impact your bottom line. Here are the most prevalent various pricing structures offered in the merchant services industry:
Flat Rate Pricing: This is quite a new form of a merchant account pricing structure. One of the most profitable models for merchants, here the payment service provider receives only a fixed amount every month as the merchant account provider's charges. These charges do not increase or decrease with your sales. In this system, there are no mark ups. The actual interchange costs are directly passed on to you from the provider. We, at Merchant Service Sales, have launched a product called "Clear View Rates". With this plan, you can now get a merchant account for the lowest flat fixed service provider charge, which is not influenced by your sales at all. We believe in utmost transparency in all our financial dealings. With this payment service option, you will have a quick, economical and transparent credit card processing solution.
Interchange Plus/ Pass Through Pricing: As per this pricing model, your payment service provider shall pass the actual interchange rates to you. Along with this, there shall be a standard mark up, in percentage form, known as basis points. Hence, in such a structure, you pay interchange plus a fixed pre-determined mark up, which makes this quite a transparent option.
Tiered Merchant Account: One of the most popular models, it reduces the interchange to pricing tiers. Qualified rate is the first tier to which all the other tiers are later added. This is a non-transparent payment service model where the true interchange is disguised in a number of generalized pricing tiers.
Enhanced Recover Reduced: This payment service option is a combination of interchange plus and tiered pricing structure. This is a non-transparent pricing model because it has a hidden charge. The hidden charge equals the difference between the actual interchange rate and the qualified rate. So, when opting for this payment service model, you will need to know the qualified debit rate, non-qualified surcharge and the qualified credit rate.
