Welcome to 2022 and a good resolution is to manage your credit card processing costs. Most of us consider controlling our weight or dieting (food intake) to manage our health but as a business owner, have we considered looking into better ways for healthy Merchant Processing programs?
For Many businesses the Christmas season is one of their largest sales cycles in the year and reviewing the statements over this period amplifies the overages that may be able to be controlled. Our Complimentary No Obligation review has helped many clients start the new year with improved processing services and/or at lower overall costs. There are generally 3 main indicators that impact the processing costs
- “Card Not Present” (CNP) either Keyed in (Phone or Curbside)
- Online/eCommerce
- Chargebacks
Keyed In are any time you have the card and it does not Tap or Chip read. These transactions tend to be 0.20 – 0.50% more than Chip/Tap and the potential for Chargeback loss is increased. “Flat” or “Bundled” pricing could even be as high as 1.50% higher as perhaps when the program was set up there was little to no CNP transactions and this was a way to get perceived lower Qualified pricing. If you were originally set up for retail Face to Face transactions and you are now keying in the transactions then you could also now be charged an additional $0.10 for all transactions where the chip/tap are not accessed.
Online/eCommerce are as the name states but these may not have been accounted for in the original pricing if there has not been a rate repricing in the past 2 years and they have introduced a web page shopping program. These transactions tend to be 0.20 – 0.50% more than Chip/Tap and the potential for Chargeback loss is increased. “Flat” or “Bundled” pricing could even be as high as 1.50% higher as perhaps when the program was set up there was little to no CNP transactions, and this was a way to get perceived lower Qualified pricing. Remember that a debit card transaction cost should be less than a credit cards and bundled programs do not differentiate the charges between Debit and credit card.
In both of these categories of Card Processing transactions there is a reduction in fraud protection from Chargeback transactions. These challenges can not only cost you the pricing increase but with some processing systems there can be an additional fee of $25-$35 per 12B retrieval request for just getting the challenge weather you win the argument with the client or not. Timeliness is the only other means of keeping the number of lost arguments to a minimum.
Merchant Connecting is transparent and happy to advise you on these potential cost increase sources and advise you of steps a business can take to be properly prices or prepared to manage or lose these costs, as a doctor helps you with weight loss.