Everything You Need To Know About Low Cost Credit Card Processing

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There are different types of fees involved in credit card processing. However, if you know about these costs and the ways to keep it down, you will benefit a lot especially in the long run. One of the most significant things to consider is the flat rate pricing.

In running a business, there are several necessary costs involved and credit card processing fees is one of them. As a tech savvy and knowledgeable business owner, you will need to first realize the importance of accepting credit cards.

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After all, this is the most preferred payment type of the consumers and businesses that do not accept credit card payments run into the risk of losing out on:

  • Customers
  • Sales and several other benefits.

Well, just like all other business owners, you too will not like to more than what is required for any good or services. However, there are lots of payment processors out there and each promising a low cost and a better credit card processing service, it is really very hard to know who really means it, how you will differs from another, and what to expect when one promises a “low-cost” processing.

Well for that you will need to take a look at all possible and various considerations for credit card payments such as:

You will also need to consider the different types of credit card fees that these service providers usually charge.

Interchange and assessment fees

There are a few fees that these credit card processing companies charge that are typically non-negotiable. One such is the interchange rates and assessment fees.

  • These specific fees are determined by the card issuers and are typically charged to the payment processors.
  • These processors in turn collect the fees from the merchant clients.

The interchange fees usually go to the authorization network which can be the banks that issue the credit cards. These fees are charged for specific purposes such as:

  • Paying for the verification
  • Routing of funds
  • Assessments go to the card brands such as Visa, MasterCard and others and
  • For the privilege of using their cards.

The interchange rates are normally based on how a specific transaction is conducted. That means the provider will consider whether or not the card was:

  • Swiped
  • Dipped
  • Keyed in or
  • Conducted online.

They will also consider the type of business followed by the merchant, the size of the sale and several other variables.

The acquirer fees

Apart from collecting interchange and assessment fees for the networks as well as the card brands, the credit card payment processing companies, who are also known as “acquirers” will also charge a few specific fess to cover the costs of all the services they provide to the merchants.  However, these fees can vary from one service provider to another, much unlike the interchange and assessment fees. The good news is that you can even negotiate on these types of fees.

The fees in this category are uses for different purposes and to pay for specific services such as:

  • Equipment rental
  • Payment gateway access
  • PCI compliance programs
  • Minimum processing amount
  • Online reporting and several other useful and valuable value-added services.

This will make the credit card payment processing much more convenient as well as dependable for the merchants.

On the other hand, there may be times when the credit card processor fees may be listed separately from the interchange and assessment fees. However, most of the credit card processors bundle these fees into one single rate. Therefore, it is crucial that you talk to your credit card processor to find out the specific terms and conditions about these particular fees. Also make sure that you know what these fees are charged for, whether or not you need that particular service that is associated with such fees and how these fees are collected by the credit card processing company.

The common credit card processing pricing structures

There are a few popular credit card processing pricing structures that the service providers follow. If you know these structures well you will not only be able to know what you are paying in the end but will also know the most effective ways in which you can negotiate with the credit card companies for a lower rate of fees.

The pricing model and structures of the credit card processing companies can vary widely. These are also very complex by nature. It is therefore important for you to note that a specific pricing model is not necessarily better than the other. It all depends on:

  • The type of your business
  • The variables involved
  • The business type
  • The processing volume
  • The acceptance methods and so on.

It is for this reason you will need to know about the most popular pricing strategies followed by the credit card payment processors.

You must also know what you are paying the fees for. This will ensure that you pay for exactly what you need and do not end up paying more in the process. Since cheaper product or service can mean inferior results you must therefore make sure that you are comparing apples to apples, and not apples to oranges. This is all the more important when you are choosing credit card payment processors.


If you find that a particular credit card payment processor is charging you more than the other do not just dump the company but make sure that you know why they are charging you more, what is the difference in service and other aspects and then try to negotiate on it when you think it is appropriate.

Therefore, when you want to benefit from the credit card payment processing companies just make sure that you have taken out enough time to research on them. Also make sure that you have clearly understood the basics of credit card fees as well as the add-ons of credit card processing services along with the reasons for the difference of value, if any.

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