Credit Card Surcharge: Fees, Laws & More Explained

Credit Card Surcharge: Fees, Laws & More Explained

The days of almost exclusively accepting cash payments are long gone, and electronic payments and credit cards are now the norm. Some new businesses are even opting out of cash altogether — deciding to save overhead costs by only supporting lean, cheaper merchant hardware. And these changes are happening for good reasons, no one doubts that electronic payments have dramatically improved financial efficiency and consumer convenience, but with that “convenience” comes additional fees — namely interchange rates & processing fees. And those fees really add up. So much so that many businesses have opted to add a credit card surcharge to payments conducted with cards to compensate for this loss. This is typically a low percent or flat rate. If you’re considering this in your business, you need to be careful. The laws around surcharges change often and vary state by state. Customers aren’t always thrilled by the practice, either….

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Interchange fees & rates

Interchange Fees & Rates: What You Need to Know

Interchange fees are easily the most confusing transaction fees you need to understand as a merchant, but they are also arguably the most important. They make up the bulk of the fees you pay and can vary widely across industry & customer base, and it’s all too common for shady merchant services providers to charge extra percentages or purposely confuse clients on the terms of interchange in hopes of getting more money. We’re sick of seeing that happen, and that’s why we’re writing this blog: to bring some clarity to interchange fees. The easiest way to understand interchange fees is by first understanding the basic definition & reasons why they exist before digging into the variations and more complex aspects of how interchange affects your business. With that in mind, let’s start at the top. Definition of Interchange Fees In short, interchange rates and fees are fees the issuing bank…

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EFT vs. ACH

EFT vs. ACH: What’s the Difference?

As you’ve been learning about different transaction types and pros & cons of each for your business, you’ve probably come across EFT and ACH. Some people use these interchangeably, some confuse them, and some use them without exactly knowing what they mean. As a business owner, it’s advantageous for you to be informed. Different payment types dictate the flow and cost of money exchanges. Even a small percent change in fees or timing difference across types can make a world of difference. Taking the time to develop the most optimal payment system for your business will serve you for years to come and lay a proper foundation for growth and scaling. With that in mind, let’s learn about EFT (electronic funds transfer) & ACH (automated clearing house). EFT vs. ACH What is EFT? EFT stands for electronic funds transfer. An electronic funds transfer (EFT) is ANY transfer by two corresponding…

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AVS (Address Verification System) Explained

AVS (Address Verification System) Explained

It doesn’t matter what type of business you have, if you’re conducting online transactions consistently, it’s important to have a set of order review measures in place. Apart from the obvious benefits of fraud prevention, order review measures build customer trust and increase your leverage in chargeback cases — ultimately reducing your overall chargeback expenses. And the more you grow, the more important these measures and the system that you keep track of them with becomes. You may already be using or have heard of some of these order review measures before; many come built-in with the processing services MSPs provide, but it’s important to know why and which parameters you have in place to both make better decisions for your business and to be able to defend yourself when chargebacks occur. Documentation and proof of process are the keys to winning cases. The most common order review checks include…

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What is an eCheck?

What is an eCheck? Everything You Need to Know

With electronic payments being the norm and cash payments & traditional checks becoming less common year after year, it can be tough keeping up with all the various forms of payments available to your business. But, as a business owner it’s important to understand the pros and cons of each payment type you can and do offer to your customers, and the more sales you transact the more important the charges and flexibility of these payment options become. Rapid growth requires a proper foundation across every facet of your business, and payment processing is a big part of that. Transaction fees really add up, so even a small percent change can mean big savings for your business in the long-run. And it’s not just about keeping an eye on transaction fees, providing the best option for your customers increases customer satisfaction and online conversion rates. With this in mind, let’s…

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