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Square Changes Fee Schedule for Small Business

December 31st, 2013

Square, the little white box that made life easier for small businesses and start-ups, allowing them to take credit cards without any real hassle has made a change to their fee schedule that has many business owners upset. The company has decided to end its flat fee rate for small firms, instead switching them to the pay by transaction model that everyone else is subjected to.

Beginning on February 1st the flat rate monthly fee that many smaller businesses opted into saved thousands of dollars per year in credit card processing fees. Instead of paying on every transaction, business owners who had $21,000 or less in credit or debit transactions a month were given the option to play a flat monthly fee of $275 for use of the service. There is a huge net of business who use the service as opposed to more traditional credit card processing options.

With the loss of this service, business can be expected to pay thousands of dollars more a year for credit card processing fees, an expense that will cripple many entrepreneurs. Small business owners who paid for the service felt betrayed after learning that it is being discontinued and are considering a switch to other payment processing options.

The fee will go up to 2.75% for every credit card that is swiped through a reader and 3.5% plus an additional 15 cents for every transaction that is manually entered, This is a massive difference between the flat rate fee of $275 a month. For any company that is working in the lower bracket, this clearly means substantial fees for them.

Square has stood by this policy change despite their customers’ objections and will put it into effect on February 1st, 2014.

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Using your cell phone to skip Visa & MasterCard Fees?

March 28th, 2013

This is a very interesting article that was posted in Businessweek. We think this technology has a real chance to completely change the industry. The idea is to use your cell phone as a payment device and having it connect with your bank account. “Why connect through the Visa or MasterCard switch, why not just connect directly to the banking system.”…very interesting!

Businessweek Article

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Verizon to add $2.00 surcharge for “one-time” online payment

December 29th, 2011

Hi Everyone,

Verizon seems to be the next large merchant who has decided to apply a surcharge for customers to use their credit cards to pay bills.  Increasing credit card processing fees seem to be the reason why this is taking place. Visa and MasterCard have taken steps in the past to discourage merchants from this type of practice, we will see if any legal remedies are used here.

Here is the Cnet posting if you would like to read more…

CNET VERIZON SURCHARGE ARTICLE

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Debit Card Fees…why have overall fees gone up?

December 8th, 2011

Hi Everyone,

Happy Holidays, the following is an article from the Wall Street Journal discussing the after effects of the 2010 Dodd-Frank Bill and the recently enacted Durbin Amendment. The article talks about merchants who have an average ticket at or below $10.00 and have now seen their debit card rates increase.  Let us know what you think…

WALL STREET JOURNAL ARTICLE – DEBIT CARD FEES

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Durbin Amendment

October 4th, 2011

As many of you know, the Durbin Amendment went into effect on October 1, 2011. The following is an article from Fox Business News that explains what this means for merchants…

FOX BUSINESS NEWS ARTICLE

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Happy 4th of July!

July 4th, 2011

In Denver for the 4th of July…I hope everyone has a great holiday!

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Visa/MasterCard – Analysts say more profitable due to debit card fee rule changes

June 30th, 2011

Hi Everyone,

Hopefully our loyal blog readers are enjoying their summer and keeping cool. The following is an interesting article in regard to the new changes that have been imposed on debit card fees. According to investors, these changes make Visa/MasterCard more profitable…

REUTERS ARTICLE ON VISA/MASTERCARD

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