Shopping for Rates

Ask a better question to get a better result

When shopping for merchant account services, change the question you are asking from "What's your Rate?" to "What's your Rate Structure?" for better results.

We talk about rate structure because pricing is just not simple anymore.  Complexity in how rates are calculated from one card to the next can have a significant impact on your bottom line cost.  Here are some examples of how rate and fee structure can impact your merchant account:

  • Watch for monthly statement fees, batch closing fees, account maintenance fees, monthly minimum fees and even annual fees. These fees can add significant cost for low volume merchants.
  • Merchants with large ticket items or the potential for a large sale transaction should also structure their rate with a per item fee.
  • Charging discount on Gross sales or Net sales after credits and returns can affect your cost.
  • As competing card companies, Visa and MasterCard each carry their own individual Interchange pricing plans. 
  • Examine the effects of card market share, which cards do your customers use most often, paying close attention to Fed regulated debit cards.
  • Artificially increasing the price of your non-qualified transactions may lower your qualified rate but increase your overall costs.
  • Always pay attention to your Real Rate (aka your effective rate) by dividing the total charged your bank account on your bankcard volume.
  • The definition of a transaction matters.  Are you bill a fee per authorization attempt or per settled transaction?

Fee structure is the most important element to good pricing. Let us compile a complete savings analysis for your review.