: I'm starting a new sale's shipping information with
business and want to accept the cardholder's billing address.
credit cards. It seems that When addresses do not match,
all the credit card processors merchants should discuss the
charge a lot of fees for each discrepancies with their
transaction. What are these fees? customers before shipping orders.
A: Each credit card processing AVS only works with cards that
company operates somewhat are issued in the United States.
differently, but there are a When AVS is used, there is a
number of fees that are common to per-transaction fee for the
all of them. Here are some service.
examples of various fees
The discount rate is the
associated with a typical percentage charged on the dollar
merchant account.
amount of a sale or a returned
The application or setup fee transaction. Discount rates vary
is a one-time charge for depending on the type of
processing a merchant application business, such as a traditional
and activating your new merchant brick-and-mortar business, a
account. Some processors waive mail-order/telephone-order
this fee to promote their business, a restaurant or an
businesses and attract new e-business. Discount rates also
merchant accounts.
vary depending on whether a card
The address verification number is keyed into the
service fee (AVS) is a fraud point-of-sale terminal or swiped
prevention measure that provides into the terminal. Swiped rates
merchants with an additional are generally lower because of
fraud-detection tool to determine the data encoded on the card's
the validity of a sale, which is magnetic stripe, which eliminates
especially useful when the card key-entry errors.
is not present. AVS matches a
The secure payment gateway fee
is a charge assessed to assessed for each transaction
e-commerce merchants to enable authorization submitted by a
them to process transactions merchant, such as a sale or a
securely over the Internet. This return. This fee is also charged
is usually a monthly fee. on transactions where the card is
The customer support fee is a declined. In addition,
monthly charge assessed by some transaction fees are incurred for
processors, which enables them to American Express and Discover
provide high-quality customer card transactions.
service 24 hours a day, 365 days
Equipment and software fees
a year, often in multiple vary depending on the type of
languages and dialects.
business—traditional
The monthly minimum fee is brick-and-mortar, mail
charged to the merchant if the order/telephone order, restaurant
total monthly discount rate or e-business. Merchants will
amount for MasterCard and Visa need certain kinds of equipment
transactions does not reach a and software in order to process
minimum threshold. If the credit cards, debit cards and
merchant reaches the minimum checks. Equipment can include
threshold, no monthly minimum is point-of-sale terminals—both
charged. Virtually all credit countertop and wireless—printers
card processors initiate this and PIN pads as well as secure
fee, and generally it ranges from payment gateways, virtual
$10 to $30 per month.
products, software and payment
The reprogramming fee is a options for Internet businesses.
one-time charge a processor may Most equipment and software can
assess for converting a merchant be either purchased or leased,
from one credit card processor to and prices vary depending on the
a new credit card processor.
processor.
The transaction fee is
Chargeback and retrieval fees:
Chargeback fees for a disputed reflected on their monthly
transaction are based on the statements.
number of chargebacks posted to
Sometimes merchants shop for
an individual account ($10 to $25 discount rates, but rates are
per final posting). Incoming only part of the processing
retrievals are requests for the picture. Look for a credit card
original transaction receipt that processor that consistently
the cardholder's bank requests provides top-quality customer
and are charged whether or not service, 24-hour availability and
there is a final posting. The a one-stop shopping experience
industry standard is $15 per (i.e., point-of-sale equipment,
incoming retrieval.
processing software, training,
Keep in mind, there are 24/7 customer service in more
numerous considerations to than one language and
maintaining an effective merchant state-of-the-art fraud prevention
account, and fees are just one procedures).
component. When you open a
Credit card processing does
merchant account, ask your credit not have to be intimidating or
card processor, agent or sales challenging. Find a processor
representative to explain all dedicated to personal interaction
your prospective rates. Be sure with its merchants. Work with
to ask if the transaction agents and sales representatives
processing company has revealed who communicate directly and
all charges that could apply to honestly with their merchants,
your account; you want to avoid explaining each charge and what
any hidden charges. Look for a it covers. Ask questions.
credit card processor with a Remember, you are the customer.
reputation for being honest and Accepting credit cards can help
upfront, whose merchants are grow your business.
fully informed of what is
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