Understanding Credit Card Fees For Merchants

Credit card fee for merchants are charged purposely for the maintenance of the service. There is an increase in the number of credit card service providers and thus prices vary. When searching for the right service that will cater for all your needs, you will be better off first understanding all the fees involved and how they may effect your merchant services.

The Various Credit Card Fees For Merchants

Transaction Fees 

Transaction fees are the most common in merchant credit card accounts. These ones will be deducted by card processors to fund different transactions. Some of them will deduct the fees even after a failed transaction.

Address Verification Service Fees (AVS)

Address verification service (AVS) fees might also be charged during CNP transactions to confirm that the address entered is the right one. AVS fees are usually deducted to reduce fraud cases during different transactions. This ensures that both card issuer and business are secure. Customer support services are also deducted from the credit cards every month. These fees are fixed and are meant to cover customer support expenses. It is important to note that some of these fees will be deducted regardless of whether there were failed transactions or not. There might also be a monthly fee deduction that covers transaction records for the month.

What To Look For Regarding Credit Card Fees For Merchants

All credit card issuers offer statements which are readily available for merchants. These may include:

  • Number of transactions
  • Dollar volume
  • Average amount of tickets
  • Other useful information

These records may come in handy when one is settling sales disputes or during tax payments.

Chargeback and Retrieval Fees 

While chargeback and retrieval fees are rare and avoidable, they still occur and it is important to learn a thing or two about them. These fees are charged when customers dispute certain transactions. Card issuers will ask for documentation showing transactions between customer and business after which the chargeback process begins. The amount for this request may range from $10 to $15 depending on the acquiring bank one is working with. The amount will rise if the customer’s dispute is successful.

Making the Right Decision

Before deciding which credit card issuer to work with, it is important to find out whether there are hidden fees to their services. Most card issuers will offer very low rates but later deduct an endless number of monthly fees. You might end up spending a whole lot more on these services than you should when working with the wrong service provider. Credit card fee for merchants can be lowered by simply learning more about them. By doing this, you will easily know which card issuer to work with and which ones to avoid.

The increasing number of card issuers popping up all over makes it very easy for merchants to save. Most of them will lower their rates to attract more traffic towards them and you can take advantage of this fact. But, being aware or the credit card fees for merchants may be your first step to a wise decision.

 

Tags:

About Admin

Matthew Hunt has been helping small businesses get set-up with Canadian Merchant Account Services since 2007 and helped 1000's do so. Join Matthew on Google+.

Comments are closed.