Each credit card processing company and each bank charges a statement fee. This is the fee charged for receiving a paper itemized listing all of your monthly transactions and the charges for each. The statement would also list the rate for each transaction, account number, and company issuing the statement.
Maintaining a Balance
Normally, there is a monthly minimum which each merchant must maintain in order to keep the account. If the monthly volume falls below the monthly minimum, then the merchant must make up the difference. For instance, if your monthly minimum is $25.00 and you only accepted $20.00 in credit cards for the month, you pay the $5.00 balance. If you regularly accept more than $25.00 in credit cards, then the monthly minimum would not apply.
Insuring the Machine
If you are leasing a terminal, you have the option of purchasing an equipment warranty to cover any accidental damage which may occur to the machine. This is a monthly fee which pays for any accidental damage to the credit card terminal. If you choose not to purchase the warranty, then you must assume any responsibility for any damage to the machine.
Moving the Money
A batch fee is the fee for the bank to make an accounting of all of the transactions and transferring them over to the merchant’s bank account at the end of the day. The merchant can choose a time of day for this to occur or he can automatically release the funds at the time of his choice.
Returns and Refunds
One of the most controversial fees for merchants is the chargeback and retrieval fee which is the fee charged by the credit card company in the event of a dispute between the merchant and the customer when the customer prevails. It is rare that a merchant prevails and for this reason, many merchants experience losses in profits. For some industries such as the lodging industry, these disputes occur more often than not.
Avoiding Identity Theft
The merchant incurs an address verification fee in the event that he calls the credit card company to verify a card holder’s address, if he suspects fraud. This is a minimal charge and because of the economic crisis, it may be worthwhile to use this privilege more often. Though it may be annoying for the customer, it would insure a safe transaction.
Optional Expenses
There are separate fees for wireless transactions performed on wireless terminals and Internet transactions conducted on Internet Processing terminals. At times, the bank or processing company may charge an application and set-up fee. Some banks charge an annual association fee which credit card companies do not charge and some credit card processors charge for customer service. Some or all of theses fees may be negotiable, depending on the company with whom you have your account.
In conclusion, there are other fees in addition to the rates for accepting credit cards which are charged to merchants for accepting credit cards.
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