When it’s time to find a company to help you start accepting credit cards for your small business, you’ll naturally want to shop fees. Also naturally, a business owner that is doing that shopping is far more likely to choose the lower rate over the higher rate, unless there’s a good reason to pay more. When credit card processing companies decide how they price their services, then, their goal, by and large, is to offer the lowest, most attractive rates and fees. In our world, that means two numbers that rise above all in importance:
The per-transaction percentage: this is the percent of the price you charged your customer. This tends to be in the ballpark of 3%
The per-transaction flat fee: this is an additional few cents (in the ballpark of $0.30) that are charged per transaction.
These are the numbers that are nice and easy to line up and compare when deciding between the various credit card processing companies, but sometimes, the story doesn’t end there… There are two ways that some companies complicate their payment structure so that you assume that the two simple fees above are the end of the story. There may also be confusing fees and hidden fees that turn up surprising you when your statement comes through.
Here are a few terms to look out for when you do your deep dive into the details of a payment processor: Qualified / non-qualified rates, or tiered pricing. Transactions from different types of cards are more or less expensive to process. Some companies use this as an opportunity to pass some of that extra expense on to the business owner. A more transparent (or at least less cumbersome) way of charging is a flat rate, which considers the average price of processing the different transactions (it’s almost always cheaper for you the business, too).
Interchange refunds: when you process a refund, does the processor give you the full transaction amount back, or do they keep the fees you were charged? I’m sure you know which scenario you’d like. Be sure to check!
PCI non-compliance fees: It’s important to stay compliant with PCI regulations. If you are out of compliance, some companies charge you, which adds insult to injury. Not only does Moolah not do this; we help you stay compliant through the resources and assistance from Authorize.Net. Oh, and we don’t charge you for that help, either!
Cancellation fees: Things can change. Be sure that your processor doesn’t require you to sign a contract, and then charge you a fee for exiting early. Moolah likes to keep things more casual than that. You’re charged each month, and you can stop services whenever they aren’t a good fit for you anymore.
When it comes to fee structures, both parties should be able to understand them easily. Anything less is unfair. If it’s time to start accepting credit cards for your small business, consider the transparent, flat-fee structure of Moolah as a good alternative to the confusing and the hidden.