When it comes to credit card processing and merchant accounts, two primary types of fees come into play: Credit card fees and processor fees
Credit card fees
Credit card fees, often referred to as interchange fees, are charges that go directly to the credit card companies such as Visa, Mastercard, American Express, or Discover. These fees vary based on several factors, including:
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Type of card: Rewards cards typically incur higher fees compared to non-rewards cards.
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Transaction method: Fees differ if the card is present (swiped or chip) versus not present (online or over the phone).
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Processing method: The way a transaction is processed can also impact the fee.
Processor fees
Processor fees are the portion of the processing fees, sometimes called the discount rate, that go to the payment processor rather than the credit card companies or regulatory bodies. These fees are typically lower than the credit card fees. Processor fees cover the costs of services provided by the payment processor, such as transaction processing, fraud prevention, and customer support.
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Understanding the specifics of credit card and processor fees can be complex, as they depend on various factors and can significantly impact your business’s bottom line. If you have any questions or need detailed information tailored to your business, our team is here to help.
Our experts are ready to provide you with the answers and guidance you need to navigate credit card and processor fees effectively.