People who are getting involved with merchant accounts will probably experience confusion along the way. This is because the terms, the conditions, and the set of rules being implemented by most merchant account provider can be hard to understood especially to people with no background in finance and banking terms.
If you have a business and you are planning to get a merchant account to be used in accepting credit card payments, the first thing that you should consider is the merchant account fees. This is a very important factor before obtaining a merchant account because this will give you an idea how much to spend and what can you gain from these expenditures.
Aside from the “turnaround time” which is a important consideration to keep you away from financial delays and other related hassles, the quality of “customer service” given which include good customer client relationship, and the “bank reputation” which provides longer operation hours, tenure the industry, alternate choices for processing payments in cases of failure in the system, and the technical support, the fee structure should be the utmost consideration.
Experts say that before obtaining a merchant account, fee structure should be examined very well to ensure that there would be problems in the flow of payments. Studying the fee structure is important to know what are the involved the fees monthly. Today more and more merchant account providers offer lower fees but it doesn’t ensure that they give better service. To ensure that you are getting the best merchant account provider, consider the rate and terms on these fees that they charge:
1. The discount rate which most of the time make up the majority of the costs made by your business. Experts say that this is the most important fees to consider because if there is lower number of times that the card is being swiped, there is a higher possibility that one is keying in Internet transactions.
2. The transaction fees are those that are charged by the processor to be able to process any transaction. People should also pay attention to this because there is charge whether the transaction has been approved or not.
3. The PIN debit transaction fees because this refers to a fixed transaction usually mounting up to around 70 to 80 cents. This should also be a consideration because some processors that charge lower transaction fees have higher hidden charges.
4. The Address Verification Service Transaction Fee or the “AVS” which applies to those merchants that are not really swiping any transaction. Make sure that this fee only range form 5 to 10 cents and should be included in the transaction fees being charged.
5. The ACH Fee or the daily batch fee which is usually charged by other merchant account processors when one settles their daily batch and they transfer their settled funds into the bank account. Make sure that this type of fee is not more than 5 cents to 50 cents only.
Other merchant account fees that should also be considered include the monthly statement or support service fee, the internet gateway fee, the voice authorization fee, the monthly minimum fee, surcharge and partially-qualified or non-qualified fees, the application or setup fee, the reprogramming fee, the chargeback or retrieval fee, the annual fee, the cancellation or termination fee, and other hidden fees or junk fees.