Credit Card Fees

How to determine Best Rate Paid

[ffctas]

What is the best way to get competing bids for the total fees one pays a credit card processor. For example how much should a business that does between $2 and $4 million a year in internet sales pay.

[Corey Bryant]

A few questions come to mind:

Is the business in the United States? How many transactions? Is this business consider high risk?

-Corey

[ffctas]

This is a U.S. business. Virtually no chargebacks. Process about 150-200 charges per day

[Corey Bryant]

Well you are looking at different rates, but probably starting around 1.99% I would guess. Without knowing more, no one can give you a definite answer. You will more than likely to provide things like

• A brief description and summary of the merchant’s account and the product, which includes shipping method, delivery time and refund policy
  
• Business tax returns–two years
  
• Personal tax returns–two years
  
• Business financial statements–two years
  
• Personal financial statements–two years
  
• Articles of Incorporation or business license
  
• Six months of previous processor statements, if applicable
  
• If there are no processor statements, submit the last three months of merchant’s bank statements
  
• Refer to attached document entitled “Supporting Documentation By Ownership Type”
  

-Corey

[sun818]

Paypal (via Express Paypal Checkout or Paypal Website Payment Pro) will give you 1.9% if you can do $100,000 per month or more. I think aggregated rate for merchant account will be higher since Discover and American Express rates will raise your processing rate.

You'd have to compare what offers you receive with Paypal is offering. Paypal fee structure rates are straightforward, but I imagine you would need to run calculations based on last year's transactions to see which account would be more beneficial. For example, you would need to calculate qualified (AVS=Y) vs non-qualified transactions (AVS=N or n/a). This would be calculated along with your fixed monthly fees and other fees like payment gateway, statement fee, chargeback processing cost, etc.

[pp_rb]

For a merchant processing more than $100,000 per month, the 1.9% rate would apply to Express Checkout transactions, but payments made through the Direct Payment API or Virtual Terminal would have a fee of 2.2% for the same merchant.