Fees charged when you use credit cards
You apply for a merchant account to accept credit cards on your website or at your brick and mortar store. There are a number of fees that apply and they can be confusing. Here is a rundown.
To understand the process here are the players
The gateway processor is the company that provides you with the access to enter the credit card information. There are a vast number of them. Authorize Net is the largest and probably the most difficult account to qualify for. The gateway processor in turn sends the credit card information to the merchant processor for approval(Visa, MC, Amex, Discover) Visa and Mastercard are considered as one for this purpose. Merchant account approval and rates are set by the vendor. Here is a sample of service provider rates and what they mean. These are sample rates and will vary by vendor.
An annual fee which typically runs around $39.00 per year
A gateway fee of $10.00 per month
A processor fee of $15.00 per month
At the end of the day you will send your transactions to be processed. This is called a batch and has a fee of 25
A 10 transaction fee for each charge that you process.
In addition to the above fees a percent of each transaction is charged
MC/Visa/Debit Cards 2.27%
Amex 4.9%
Discover 2.22%
Corporate Business Card is the above percent plus an additional 1.25%
Address Verification: Usually optional. A function to verify the billing address on the credit card is 5 per transaction.
Equipment Purchase: Usually free, the vendor will give you the equipment. A computer internet connection is required for manually keyed transactions.
To understand the process here are the players
The gateway processor is the company that provides you with the access to enter the credit card information. There are a vast number of them. Authorize Net is the largest and probably the most difficult account to qualify for. The gateway processor in turn sends the credit card information to the merchant processor for approval(Visa, MC, Amex, Discover) Visa and Mastercard are considered as one for this purpose. Merchant account approval and rates are set by the vendor. Here is a sample of service provider rates and what they mean. These are sample rates and will vary by vendor.
An annual fee which typically runs around $39.00 per year
A gateway fee of $10.00 per month
A processor fee of $15.00 per month
At the end of the day you will send your transactions to be processed. This is called a batch and has a fee of 25
A 10 transaction fee for each charge that you process.
In addition to the above fees a percent of each transaction is charged
MC/Visa/Debit Cards 2.27%
Amex 4.9%
Discover 2.22%
Corporate Business Card is the above percent plus an additional 1.25%
Address Verification: Usually optional. A function to verify the billing address on the credit card is 5 per transaction.
Equipment Purchase: Usually free, the vendor will give you the equipment. A computer internet connection is required for manually keyed transactions.
