What credit card processing costs can you control?  If you look at my second blog post (November 2013) you will see a bullet point titled "Processing fees - Negotiable."  This outlines the basics of controllable cost.  This same post also outlines the basics of interchange cost which is the uncontrollable cost issued by the card associations (Visa, MasterCard etc.).  You must exercise caution when looking at "processing fees."  Many processors will pad interchange cost to make their processing fees look lower.  Many also have confusing or basic statements so that it is impossible to distinguish between processing fees and interchange cost...this is true of all bundled, tiered and flat rate programs.

Only a true interchange (cost) plus program will show all of the interchange costs and processing fees, but what are processing fees?  Processing fees are the fees charged by your processor so they can make a profit.  They include a percentage of credit card dollar volume fee (also known as basis points), per transaction (per authorization) fee, monthly service/maintenance fee, statement fee, batch/close/settlement fee, pin debit service fee, pin debit authorization fee, monthly minimum, regulatory and compliance fee, TIN validation fee and early termination fee (ETF)...to name a few. 

If you have a really good processor they will only charge you the percentage of credit card dollar volume fee (also known as basis points or discount rate), per transaction (per authorization) fee, pin debit authorization fee (if applicable), monthly service/maintenance fee and possibly a batch/close settlement fee.  There is no reason to pay any of the other fees.  Their sole purpose is to pad the processor and sales reps' pockets.  I do not charge any fluff fees.  I believe in long term relationships based on FULL disclosure, great pricing and excellent personal service.

There are some "Other fees" that you may encounter in addition to Interchange cost and Processing fees.  These fees are virtual terminal (gateway hosting) monthly fees, wireless device fees, virtual terminal/gateway authorization fees and PCI compliance fees to name a few.  You should definitely get a good explanation for all of these fees to be sure you are not paying for fluff.

So how do you know if you have good controllable costs?  Call or email me with any questions you may have.  I can also do a free analysis for you.  Every business is different...retail, wholesale, card not present, eCommerce...and then there is customer demographics which affect the types of cards you receive for payment as well.  I can help you find the best program available to fit your needs.