Lowest Rates

Get Lower Card Processing Fees

If you have a merchant account, or just own a business, then you probably get a lot of phone calls promising to lower your merchant account fees. It pays to keep in mind that people would not be calling you unless they could show you a savings, but remember that the big print giveth, and the small print taketh away.

Interchange Fees

Credit Card Processing FeesCredit card interchange fees represent the ground floor for how much you will pay for processing. Note that unless you happen to be one of the owners of Wal-Mart or McDonalds, you are not going to pay any less than interchange plus markup. Interchange rates are published online twice a year, and unless you are on an outdated "tiered pricing" system with your processor, your fees will rise and fall with your "interchange plus" or "cost plus" program. As a matter of semantics, "cost plus" is a part of daily life, since people need to make a profit on the things they sell if they don't want to go broke. The gas in your car is "cost plus" as is the bread you eat unless you are on food stamps, in which case the cost is borne by the taxpayer. Normally the markup may be expressed as "basis points" which are hundredths of a percentage point, or as a figure like ".07%" which looks really affordable until you recall that the amount is added to whatever you are being charged, and there is normally a per-transaction fee up to 25 cents. Sure, .07% looks good on an advertisement, but you are only likely to pay that on "debit cards swiped through the terminal with a PIN code entered."

Companies such as Square offer fixed rates like 2.75% on swiped cards, but if you are doing a good enough volume then you can cut this cost down significantly by getting a merchant account. Note that you have to be careful beyond the quoted markups, because many back-end fees can totally negate the savings. PCI fees, leasing costs, minimum volume fees, and the puffy pants tax can get added onto your statement in a way that brings on buyer's remorse.

Get Out Of Merchant Agreement

Want to know how to get out of a merchant agreement? Good luck! These things are written by lawyers from billion-dollar companies, so you need to be sure you have any caveats to your contract in writing up front. Ask for a performance letter that lets you out of your agreement without any early termination fees or added costs. Many merchant account vendors may have provisions that you can cancel if they (not Visa/MasterCard) raise their rates and you cancel within a certain time window. If you check your statements religiously, you may see such a notice buried in the fine print. Depending on your processor, it may not take much time for this to happen because they may have brought you in under a super-low rate and then raise it after 3 months in the hopes that you won't notice.

Beyond this list there are many ways you can help. When donating, always ask yourself whether the gift helps people get on their feet, or keeps them dependent on professional charity rackets. Check out Charity Navigator to make sure that your dollars don't get further reduced when you distribute the gift given in your name. Remember, you may be giving away someone else's money, but if you do it the wrong way the bad karma falls directly on you.

Interchange Fee

Pass Through Costs

Acquirer Processing Fee

Fixed Acquirer Network Fee

Misuse of Authorization Fee

Zero Floor Limit Fee

International Service Assessment Fee

Acquirer Brand Volume Fee

Cross Border Assessment Fee

AVS Fee for CNP

Account Status Inquiry Fee

There are also fees for chargebacks/retrievals, IRS filing, and for PCI compliance. In many cases you will see a PCI fee as an added surprise that comes with your agreement. Whenever a salesman (not being sexist here, most likely a "man") comes to your store, ask to see a breakdown including what you would pay under the proposed pricing structure plus all fees. Use your last 2-3 merchant statements to get a real-world comparison.