Merchant Accounts and the Fees That Come With It

Your business can be taken advantage of with unnecessary costs from your credit card processor. The aim of this article is to understand how the merchant account-pricing model works and why it’s important to be mindful about it.

Card processing companies allow merchants to process payments for a small fee. However, some companies will take advantage of merchants, adding extra and unnecessary charges. When you are shopping for merchant accounts, the fees are probably one of the most important deciding factors. The problem with these fees comes when they’re not disclosed and you’re not expecting them. Therefore, it is wise to gain an understanding of the various fees often charged by credit card companies. The following are some of the most common fees:

  • Hidden Transaction Fees: In virtual cases, you can expect to pay 10-20% whenever your customer swipes a card; even if the transaction is not accepted. If the customer keys in the numbers, you’ll be paying anywhere from 25 to 30% per transaction.

  • Payment Gateway Fees: Apart from the fee that a merchant has to pay for using a payment gateway, make sure you understand that the provider might charge for every transaction.

  • Monthly Minimum Fees: If you do not reach this minimum, you will be required to cover the difference.

  • Annual Fee: This is paid once a year. The company charges you this fee to administer your account and handle the transactions.

  • Setup Fee: Your Company may levy this fee to cover the cost of processing your application and opening your account. Increasingly, however, in most cases, providers do not charge for these services.

  • Chargeback and Retrieval Fees: These fees only occur when a customer contacts the bank to dispute a charge.

  • Termination or Cancellation Fees: This only happens if you breach or terminate your contract. If possible, choose a credit card processing company that does not charge termination fees, as variable ones can turn out to be
    extremely costly. However, not every provider charges this fee.

  • Statement Fees: This fee is for a monthly paper statement. However, it is not taken generally.
  • Fees for Half-Qualified and Non-Qualified Cards: This is by far the most unknown fee to many merchants; credit cards fall into different tiers and you pay higher fees for some than the others. Rewards cards, for example, often fall into the half or unqualified categories and generate higher fees to the merchant.

 

Ultimately, the key to a successful merchant account is full disclosure. Choose a credit card processing company that is transparent about all the fees they charge.

If you have a similar question or more, get an expert at Merchant Stronghold at the toll-free number +1 (888) 622 – 6875. We also provide credit card processing solutions and high-risk merchant account services.

 

Original Source: - https://bit.ly/3O9br4X

Comments

Post a Comment

Popular posts from this blog

HOW to SET UP A CIGAR SHOP

Despite health-related campaigns in the public sphere and laws against tobacco products however, the demand for cigars is still high.   The restrictions set on where you can smoke are aiding cigar shops.   If they are allowed cigar shops can serve as smoking lounges, and are among the few places where customers are still able to enjoy smoking a product. STEP 1: Plan your business A well-defined plan is crucial to be successful as an Entrepreneur.   It can help you figure out the particulars of your venture and help you discover the undiscovered aspects. Step 2: Create an entity that is legally legal The most commonly used forms of business structures are partnership, sole proprietorship as well as the Limited Liability Company (LLC) and the corporate. STEP 3: Register for taxes You'll need to sign up for various federal and state taxes prior to you are able to open your business. To register for taxes, you'll need to submit an EIN.   It's simple and cost-free! Step 4...
Read more

Merchant Account Offshore to Protect High-Risk Processing

Image
  Could your business survive in the market if your merchant account was suddenly canceled? What are your backup plans to protect your business against losing high-risk processing capabilities? Diversification of high-risk processing is a simple strategy that can help you safeguard your business interests. Businesses in high-risk processing categories must establish multiple accounts, including a merchant account offshore, to protect their business operations against fraud or charge-backs. Establishing a merchant account offshore in several jurisdictions is vital for assuring the continuing viability of your business. There are many instances of businesses losing payment processing accounts. Money that is urgently required for running the business is being held by the processing bank. The bank will hold the money for up to 180 days, as a protective measure against any possible charge-backs. The money will be kept in protection even if the merchant has never had a charge-back in the...
Read more

Merchant Services for Skin Care Products

Beauty and health is a thriving, competitive and profitable business. If you're a retailer who specializes in online sales, or storefront sales for health and beauty, a merchant account is required to run your business. There are a variety of sub-niches in the beauty and health industries and along with them are different business models and methods of payment processing. Merchant accounts for beauty and health and payment processing are typically considered to be high-risk by banks that acquire them or payment processors. This means that when you are a business in this area you should avoid conventional, low-risk solutions in order to avoid losing your merchant account in the near future. While high risk merchant account will likely cost you more, they will also set up your business to be successful in the long term and let you accept payments, combat chargebacks, and manage transactions across the globe. With Merchant Stronghold, we can quickly assess your business and get it a...
Read more