Credit card companies are well-known for trying to trick customers and charging them fees. Merchant account processing is no different. However, it is important to realize that charges and fees are revenue sources for card companies. Knowing the fees will help you understand and appreciate the credit card processing fee structure. Below are the different fees charged by card processing vendors.
Application Fee: This fee will be charged at the time you apply for merchant account service. However, it is not usually charged by reputable companies so avoid this as much as possible.
Startup Fee: These are the charges for opening a credit card processing account. To know more about how startup fees are deducted from card processing fee visit at https://evokeprocessing.com/ for better understanding of this process.
Discount Rate: These are the primary fees that the card company charges as a percentage for each transaction. It usually ranges between 1.5-2 percent for each transaction. For high-risk businesses, it could be higher.
Chargeback Fee: This fee is charged if there are a lot of transactions being charged back. Normally, there is a limit to how many chargebacks can be made in a given month before the fee is imposed.
Termination fee: This is charged to terminate an early contract. Contract periods typically range from one to three year. This fee is between one hundred and three hundred dollars.
Credit card processing should be approximately 2% of total card transactions. This is a reasonable amount for businesses to offer debit and credit card processing services, as well as enough to allow payment processing vendors to make a profit.You should carefully read the contract, including the footnotes and fine print.