Posts Tagged ‘Interchange Fees’|
Monday, April 1st, 2013
Hello to our loyal blog readers. We have a link to a great post from Forbes in regard to some of the happenings in the credit card processing industry. This article briefly talks about: Internet Sales Tax Gaining Support in the Senate and how fees are growing higher…
Thursday, December 8th, 2011
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…
Tuesday, 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…
Tags: Credit Card Processing, Credit Card Processing Fees, Credit Card Processing Fees Legislation, Durbin Amendment, Interchange Fees
Posted in Credit Card Processing Legislation, Durbin Amendment, Industry News | No Comments »
Thursday, June 30th, 2011
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…
Tuesday, January 11th, 2011
Happy New Year everyone! The following is some news we are following in regard to upcoming changes in interchange fees with Visa and specifically those that pertain to the acceptance of Visa Debit cards…
The Processing Brokerage
Monday, February 15th, 2010
Every couple of weeks, I like to browse the most recent payments industry articles that have been published online to see what people are saying. For the most part, I very rarely read anything that is not published by a reputable site. With that being said, I was shocked to read this weekend an article posted online by the Wall Street Journal (WSJ) titled “For Businesses That Accept Cards, Tips for Cutting Fees“. The following is how this article started:
“When it comes to credit-card fees, bigger companies have more clout with issuers than small ones. But there are ways to minimize costly processing fees, from negotiating to shopping around. Here are eight tips.” – At this point, I am very intrigued! The author is right, bigger companies will always have more clout but that doesn’t mean you can’t have a low rate.
“Negotiate processing fees – To negotiate the interchange rate, which is set by Visa and MasterCard accounts for about three-quarters of merchants’ card acceptance fees, business owners should contact Visa and MasterCard directly, says Trish Wexler, a spokeswoman for the Electronic Payments Coalition, a group representing banks and credit-card networks.” - This statement is incorrect and it is articles like these that confuse merchants on what they should do. Unfortunately, you cannot call Visa and MasterCard directly to negotiate interchange rate as this rate is un-negotiable. There are over 300 interchange rates and though you may not be able to negotiate for a better rate, there are steps that you can take to make sure you process at the most optimal rate. If you would like more information on if you are processing at an optimal rate, contact your processor or us at The Processing Brokerage and we would be more than happy to point you in the right direction.
- The Processing Brokerage
Sunday, November 8th, 2009
According to the Wall Street Journal, U.S. banks raked in $45.3 billion last year from credit- and debit-card fees charged to merchants. About 75% of that comes from interchange fees set by Visa Inc. and MasterCard Inc. Overall merchant fees, including other revenue collected by banks and processing middlemen, are up 78% from $25.5 billion in 2003, according to the Nilson Report, a Carpinteria, Calif., newsletter that tracks the payments industry.
Merchants in the U.S. paid an average interchange rate of 1.82% per transaction last year, down from 1.93% in 2005, according to the Nilson Report, an industry’s argument that fees are falling. Please contact the Processing Brokerage for information on our interchange optimization program.
To read the rest of the article about credit card processing interchange fees, please click below:
Monday, October 26th, 2009
Interchange is in the news again due to the House Committee on Financial Services hearing which discussed the components of the Expedited CARD Reform for Consumers Act of 2009. As many of you know, Interchange makes up a large part of your credit card processing fees and there is currently a discussion on BusinessWeek.com with different merchants who are sharing their stories on what they have done to reduce these fees.
- The Processing Brokerage
Wednesday, October 7th, 2009
We are happy to see businesses start taking action against the high fees that they are paying for their credit card processing. Let’s take a look at one of the excerpts from the article posted below:
“We have two stores in California. 50% of our credit card processing fees is about $800 per month. The other store is almost a $1,000 a month. Our [interchange] fees are based on the total transaction, not on a merchandise purchase. If a customer bought a thirty-five cent pack of gum and received $30 cash back so that $30.35 was run on the card, I would pay the percentage of fees based on the money I gave back as well, not just on the merchandise that was sold. My store allows customers $40 or $50 cash back, and it has typically 50 of those in a day. I have to pay interchange fees on all of that.”
There are a couple points that all merchants should know in regard to this quote:
1.) If you allow cash back on your transactions, you are essentially paying their ATM fee for them through your interchange fees. Remember, your interchange fees will range from 1.4% to over 3.00%.
2.) All customers and their cards are equal – Remember, according to Visa rules and regulations, you cannot add your own convenience fee to a transaction just because they are using a credit card. You have to charge everyone the same. In this case, you are unable to charge a convenience fee just for a credit card purchase on cash back…you would have to charge everyone (even cash customers) the same convenience fee on all transactions. This is a very frustrating aspect as you are pretty much trapped into eating these exorbitant costs.
- The Processing Brokerage
Monday, January 5th, 2009
Happy New Year!
With the New Year upon us and everyone making their resolutions, we thought it would be good to provide a post for those whose resolution is to reduce their credit card processing fees: 10 Ways the Processing Brokerage Can Help You. Read and enjoy…
1.) Significant Rate Reduction – This naturally has to be #1. We will be your broker in finding the lowest available credit card processing rate. We will provide the analysis you need to make an informed decision. We will provide recommendations and help you through every step of the way.
2.) Interchange Optimization - Though you cant avoid interchange fees, you can optimize your credit card processing to ensure you are being charged the lowest rate. The Processing Brokerage is your interchange optimization expert.
3.) RFP – Watch as proposals are uploaded into your account area for review while analysis is created to compare each proposal received. You can use our Elite Rep Network or your contacts to choose who is a participant in your RFP. Choosing a vendor for your credit card processing couldn’t be easier with the help of our services.
4.) Independent Analysis – You pay for what you get! A mistake in choosing the wrong processor can cost you thousands of dollars in higher fees. Would you trust a car salesman to give you the lowest price available or an independent party?
5.) Small Business – Our Small Business package offers every tool you need to successfully reduce your credit card processing fees without paying a premium fee. Specifically designed for businesses who process less than 1 million in credit cards a year, our disciplined approach ensures your business will be setup correctly, efficiently, and receiving a rate you thought only large corporations could get.
6.) On your time – We know that you would rather have a root canal than look into your credit card processing and sometimes it just takes time till your ready to move to a lower credit card processing rate. We understand!
7.) Premium Services – Our pay for performance premium service ensures you will receive the lowest credit card processing rate available. You will have access to all of our resources and tools to make the best decision for your company. We will even assist in reducing your current rate so that you don’t even have to switch processors.
8.) Friend in the Industry – We are the experts in the industry so why not let us do all the work for you. Make the decision that is best for you. We will guide you the whole way.
9.) Validate My Rate - Use the Processing Brokerage to validate if your credit card processing rate is competitive. If we tell you it is competitive, don’t waste your time talking to another credit card processing representative… you know the truth.
10.) Resolution Completed – Just think, if you use us to reduce your credit card processing fees, you can guarantee yourself of having completed at least one New Years resolution. Your welcome!
We truly hope everyone has a wonderful New Year!
Steve Williams – The Processing Brokerage