There is certainly much competition today in the merchant services industry. Every company claims they provide the cheapest rates. On this website, we make claims of having the lowest credit card processing fees today. Is this really true and how can one company offer lower rates than the others? It quite simple, the reason why we offer such low rates is because our overhaul is not as high as our competitors. Every merchant provider is offered the same buy rate from the sponsoring bank as well as Visa/MasterCard network or the bankcard network to marked up for a small profit. Most providers’ rates are based on their business strategy/model and the amount of money spent advertising their services. The main reason why our rates are as low as they are is because we do very little advertising and our business model does not have a huge overhaul like most companies. We are completely debt free company. There is certainly great competition in the industry that why it is imperative to select the right service provider. It is not all about rates and fees but a combination of great rates/fees and customer service.
Furthermore, it is important to understand the difference between Qualified, Mid-Qualified and Non-Qualified rates. Because of this merchants do not always pay the same fees for processing credit cards as there are downgrades (surcharges) associated with how you process transaction and the type of cards you accept. PIN-based transaction are always the lowest because the transaction is not processed through the MasterCard/Visa Network. Small business owners know that it is important for them to conduct their research before selecting merchant services company to setup a new account for their small business.
We offer our customers Pass Through rates which is the lowest rates a company can pay in this business. It is basically what big corporations such as Starbucks, McDonalds and others pay. What most companies offer is tier pricing (the most popular) which is also offered by us if companies are interested in their pricing plan:
--Retail Qualified Rate: 1.59%, $0.20 per transaction
--Retail Mid-Qualified Surcharge: 0.20%
--Retail Non-Qualified Surcharge: 0.40%
Here is an example for Interchange Plus offered by us:
--Retail Debit: 1.09%, $0.05 per transaction
--Retail PIN based Debit: $0.20 per transaction (there are no discount rates for PIN based transactions.)
--Retail Credit Card: 1.59%, $0.10 per transaction
The discount rate that merchants end up paying to accept credit cards are mostly based on the Visa/MasterCard rates. These rates offered by the bankcard network is the wholesale price paid by the issuing financial institution, with the exception of American Express as they set their own discount rates which is typically 1% higher than the typical discount rate. Nowadays, merchants will be able to know ahead of time what the American Express rates will be before they are setup. Discover rates are the same as Visa and MasterCard except for the per transaction fee of $0.10 which is higher for running transactions through the Discover Network.
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