Payment processing online is a complicated process involving a number of players: the merchant, the merchant’s bank, a payment gateway, payment processor, credit institution, the buyer’s bank, and the buyer.
If you own a business, you will incur a credit card processing fee every time you accept a credit card as payment for your goods or services. While these fees may seem overwhelmingly complicated, it’s important to try and understand them and how they are incurred, to remain in control of your business and the fees that you’re charged.
First things first, it’s important to understand that all payment processing companies are not created alike. There are countless companies out there, and all operate differently and charge their merchants differently for the services that they provide. Finding the right low cost payment processing company can make a huge difference in the amount of a credit card processing fee that you’re charged, and in the quality of services that you receive.
Here are some common credit card processing fees that you should expect from your payment processor.
Application and Setup Fee
When you apply for a merchant account, a fee is charged for the processing and activation of the service. This is a one-time fee that is paid when signing up, or once the merchant account has been granted. This fee will also include the setup costs required to integrate and install the payment gateway service onto your business website. This charge can range from as low as $30 to as high as $300, depending on the payment processing company you choose to work with.
Some companies, like us here at Allied Wallet, waive the application and setup fee entirely, creating your merchant account and integrating your website with a shopping cart and payment gateway for free. It’s worth looking into companies that save your business from expensive setup costs.
Discount fees are the percentage amount that is discounted from a sale by credit card. This amount is extremely important to consider, as some companies charge exorbitant discount rates that can severely affect the success of your business.
On the opposite side of the coin, other companies charge very low rates, but charge you an arm and a leg for other fees to make up for it. Make sure to compare these percentages while taking into consideration the other services and benefits that a payment processing company offers.
Here’s a helpful chart that compares payment processors, discount fees, services, and other charges against each other to help you decide which company will work best for you.
If a customer demands a refund to their credit card, a chargeback fee will be charged to your account. This fee can range from provider to provider. These fees can partially be avoided by your business’s ability to provide excellent customer service and quality products. The truth of the matter is that chargebacks are an inevitable aspect of doing business anywhere, online or offline. One of our most important merchant services are our chargeback prevention features, designed to help the merchant deal with chargeback issues.
We offer merchants a selection of detailed tracking and reporting tools, and a customer database to cut back on chargebacks and deal with them effectively.
We are a leading payment processing company offering a wide range of merchant services and low credit card processing fees and rates. For more information, speak to one of our agents at any time of the day or night to see how you can be approved for a merchant account and start accepting credit card payments online in just 12 hours.