Retail Credit Card Processing 101
Retail credit card processing is when a face to face sale takes place and a card is swiped. When a retail merchant does not accept credit cards it will often contribute to loss of sales.
Retail credit card processing requires a merchant account and equipment or point-of-sale system. Before deciding on a piece of equipment you must first decide what functionality the terminal or point of sale will serve. Will you be accepting PIN based debit cards? Will you be accepting tips? Do you want retail check conversion? Do you want to connect via dial up or IP connection? There are various types of equipment available for merchants to choose from and the following is the major equipment brands:
Most equiptment will range in price from $60 for refurbished models to $600 for dual communication terminals.
How much will it cost?
Most merchant accounts will have a discount percentage rate and per transactions fee. Although this pricing varies from one processor to another there are more factors than just providers. A merchants rate can vary by business type, average ticket, and number of transactions that take place. Beware of introductory pricing. If the rates being offered are lower than published interchange rates, they are making the money up somewhere. Additional fees to be aware of:
- Statement/Monthly Fee - Covers mailing of statement and customer/technical support
- Chargeback Fees - Charged when a cardholder disputes a transaction
- Retrieval Fees - Charged when a cardholder requests more information about transaction
- Batch Fees - Charged each time a batch is transmitted to the host, usually once a day
- ACH Fees - Charged for each ACH file created and transmitted for payment
- Monthly Minimums - The minimum amount of fees that will be billed each month
- Account Change Fees - Charged for each change made to the merchant account
- Annual Fees - Charged once a year for various reasons
- Cancellation Fees - Charged if merchant contract is not fulfilled usually 3-5 year term
- PCI Monitoring Fees - Charged to cover fees associated with monitoring and verifying
What are other things to consider?
When choosing a merchant service provider, ask about PCI compliance and what your responsibilities are. If they cannot provide you with an answer, do not take a chance on this provider. The fines associated with PCI noncompliance or breaches can range from $5000.00 to $500,000.00.
At BankCard Central we assure you that we will help you choose the right solution that will be most effective, efficient and economical for you. We guarantee upfront pricing with no additional hidden fees. We will also make sure to educate you regarding your responsibilities for PCI Compliance.
For more information please contact the sales department at 800-745-7220.
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