So What Is The Real Rate?
I spoke with a merchant today who promised me her rates cannot be beat. Her rates would be pretty good, if she actually paid what she thought she was paying.
This business owner thought she was being charged a rate of 1.59% on both her debit and credit transactions. Reviewing her statement, she was actually paying 1.59% + .1000 . In addition to the discount rate, she was also charged per transaction fees rangng from $0.19 to $0.34.
Although she was not paying an annual fee, or any of the junk fees, and she was only paying a $10 per month statement fee, her total discounts and fees added up to 2.7% of her monthly credit card volume. That’s not the highest I have seen, but getting her fees back in line should put her back into the low 2% range where she should be.
Her fees were also higher than they should be because she was only paying one rate for both her credit card and debit card transactions. This would be okay if most of her transactions were credit and not debit based. Unfortunately, 60% of her transactions were from Visa or Mastercard debit cards and this means she pays TOO MUCH.
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