Pay the Lowest Credit Card Processing Rates with Interchange Pass Through

Starting your own business can be stressful. Setting up the licenses and understanding credit card processing technicalities is only the beginning of the struggle. The best way to work through these matters is getting educated on particular business services and lingo in order to avoid scams and disadvantageous deals. Here are the basics that you should know:

 

Credit Card Processing Fees

Accepting credit cards is mandatory for 99% of all businesses today.  Understanding and managing your fees for service and technical issues of credit card processing will help you keep your business on the road to success.  To start off, your business needs a credit card machine to electronically process the transactions, because if you don’t process them electronically, it will cost you twice as much and delay your cash flow significantly.  The most expensive way to acquire a credit card machine is the “free equipment” programs, while the lowest cost solution is to simply buy the terminal outright, and own it.  Merchant service providers will assist in setting up credit card machines in your store, but it is your responsibility to avoid getting trapped under expensive deals with long-term monthly minimum and annual fees payable, never mind the onerous early termination “hook” fees. 

 
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How To Get The Best Credit Card Processing Program For A New Business

There are many options to consider when looking for a credit card processing program for a new business.  For many business owners, the sheer amount of merchant account providers available and all the different options can be overwhelming.  In this article, we’ll help you navigate through some of the most common issues you’ll face as you think about acquiring the best credit processing merchant account program possible for your new business.

 

How Much Will My Credit Card Machine Program Cost?

If you end up with a merchant account provider who is not upfront about fees or
other important contract-related monetary considerations, run, very, very, far away!  Take a careful look at the full rate and fee schedule.  You may find the lowest rates available with a super-low percentage rate on transactions, but then get slammed with exorbitant fees in other areas.  Always exercise due diligence when evaluating these programs, especially when taking a look at free merchant account programs.  There is usually no such thing as a “free lunch,” so be careful.  There is always a catch!

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An Interchange Plus Pricing Structure Can Greatly Reduce Your Credit Card Processing Fees

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By:  Gerald Kadish


Traditionally small to mid sized businesses have been set up with what is called multi-tier pricing for their credit card processing. This system is usually set up with three tiers (qualified, mid-qualified, and non-qualifed.) Occassionally, if the business owner has negotiated well, there will be a fourth tier for qualified offline debit cards. While this system has worked well for many years, the increasing number of rewards and corporate cards being issued has made this type of pricing obsolete.


Visa and Mastercard have many different interchange categories for the multiple card types that are issued. Tier pricing takes a large number of these categories and lumps them into one of the three tier buckets available to the merchant. If the merchant only ever takes standard credit cards then this system will work well for them. Once they start to see more debit, rewards, and corporate cards being used in their place of business they will notice that their merchant services bill has increased dramatically. This is because many of these transactions are falling in to the mid or non qualified transaction categories.
Continue reading An Interchange Plus Pricing Structure Can Greatly Reduce Your Credit Card Processing Fees