Entries tagged with “Merchant Account”.


Finding the right payment processor for your small business is all about looking for features that match up well with what your business does. Here are some examples of features you should look for depending on your business.

Mobile Card Readers for Local Businesses

One useful feature you can get from a payment processing company is a mobile card reader. This is a device that sits right on top of your phone which can process credit cards securely in-person.

Many of the better ones give you a free app to go with it, and let you plug them right into a convenient area like the audio port. This feature is ideal for local businesses that do a lot of commerce in person and not at a stationary POS system within a store. A mobile card reader will be useful for brick and mortar stores that don’t want to pay extra for the more extensive credit card devices, and also for small businesses that carry product from within their own home and want to be able to process credit cards for local customers.

Multiple Payment Storage Options for Online Businesses

One excellent way to encourage repeat customers for your online business is to make it really easy for them to store payment options. Trivial inconvenience is the great killer of e-Commerce. If customers can store different credit cards and payment options with your site using a payment processing service that allows for this, then they can come back and make additional purchases with much less hassle.

Having to enter payment information over and over again is going to deter repeat business. That’s why the multiple storage feature can be useful for encouraging growth in small businesses that focus on internet transactions.

Regardless of how your small business operates, it can benefit from the right payment processing features. For more information about these features and others, please contact us at ProPay today.

In the world of merchandise processing, there are two different types of transaction processing: swiping and keying. With the constant accessibility to mobile devices such as tablets, smartphones, and laptops more and more merchants are using swiping, but why? In order to fully understand why more merchants are swiping cards versus keying them in, let’s take a look at the difference between swiping and keying credit cards.

Swiping vs. Keying Credit Cards

The difference between swiping credit cards and keying them in is pretty self explanatory, when swiping you have to have the card present and it typically requires either a mobile device with a swipe adapter such as ProPay’s JAK, or a computer/register with an internet connection. Whereas when you key a credit card in, merchants have to hand enter every card number and the credit card doesn’t actually have to be present. So, why are more merchants avoiding keying credit cards? Three reasons: fraud, savings, and convenience.

Fraud Rates

The biggest reason not to key in credit cards is plain and simple: fraud. Because merchants don’t actually have to have the credit card present with keyed payments, the chances of fraudulent transactions are a lot higher. Because most thieves steal credit card numbers instead of the card itself and then make by-phone or online orders, the card itself is never seen. Avoid these types of no-swipe fraudulent transactions altogether and only allow customers to pay for merchandise when they have the card present.

Savings

Because there is a higher fraud rate for credit cards that are being keyed in, credit card processors charge a higher rate for keyed transactions compared to swiped transactions, in order to protect themselves against any false transactions. How much more money do they charge? About .5% more per transaction. For example, credit card processors typically charge around 3.5% for keyed transactions, whereas ProPay only charges 2.29% for keyed transactions.

Convenience

Have you ever had to hand enter someone’s credit card only to realize you misentered one number and you have to start all over? With swiping, you never have to worry about that problem again. Also, you can swipe anywhere, at anytime—giving you the freedom and mobility your business needs in order to stay prevalent in this economy.

To learn more about swiped rates visit ProPay online.

As a merchant there are many things to be wary including merchant processing fees and percentage rates. The problem? When you see a certain percentage rate, it’s not necessarily the rate you’re actually going to be paying. So what factors are leading to credit card companies charging merchants extreme and varying processing fees?

Base Credit Card Processing Fees- The Types of Merchant Processing Fees

In order to better understand merchant processing fees, it’s important to know the two main components involved: interchange rates and fees, and assessments. So what are these exactly? Let’s dive right in and see for ourselves:

Interchange Rates and Fees

Interchange rates and fees account for the majority of credit card processing fees. Specifically, interchange is the process during a transaction that takes places when money is transferred from the acquiring bank to the issuing bank; these associated fees are established by major credit card companies. How do credit card companies establish these fees and rates? It’s easy—basic stakeholders of major credit card companies like American Express, Visa, MasterCard, and Discover decide how much they want to charge merchants when they accept their credit cards. These credit card companies (or banks) then decide on interchange fees that are associated with things such as processing methods, types of credit cards, and other associated merchant variables.

Assessments

Large credit processing companies like Visa, MasterCard, and Discover card make money by charging assessments on every transaction involving one of their credit cards. Although assessment fees are charged the same for all processors, if bundled, assessments can be charged differently.  Bundled pricing gives processors more control to manipulate pricing and are changed periodically by the card brand and type.

The Solution: ProPay

Typically, merchant processing companies charge different percentage rates for different cards. For example, if a company offers you a rate as low as 1.99%, you won’t necessarily get that rate with all cards— rather just with major credit card providers such as Visa and Mastercard. At ProPay, what you see is what you get–if we offer you a low rate, you will receive that same rate on all transactions. We believe that transparency is the key to running a successful business and we want all or our customers to feel 100% satisfied, 100% of the time.  ProPay makes it simple to decide who to choose for your merchant and credit card processing. To learn more about ProPay and how you can simplify your business, click here.

Running a business is expensive. Gone are the days where overhead charges were composed of mere office supplies and rent. Now you can add high-speed internet, company cellphones, computers and laptops, a well-versed staff, and yep, even those dreaded merchandise swipe charges to the list.

Swipe Charges Defined

What are swipe charges exactly? Broken down into simple terms, swipe charges are the hidden fees that merchants pay credit and debit card companies every time they swipe a card for payment. Swiping allows you to accept mobile payments on your phone, tablet, laptop, or other mobile devices. Depending on the merchandise service company you decide to go with, interest rates for swipe fees typically start around 3% and increase based on additional services added. Resulting in an initially small overhead charge suddenly turning into a seemingly large expense for merchants everywhere. But swipe charges don’t have to turn into another large business expense—with ProPay’s low interest rates, constant accessibility, and multiple options to choose from, both you and your company are going to benefit.

They’re How Low?

No, we are not talking about your limbo skills here but rather, extremely low interest rates. Although some companies are still charging merchandise companies insane swipe rates, ProPay is helping save small and large businesses money every day. With a low swipe rate of… wait for it, 2.6%, you can give your customers the satisfaction of being able to pay conveniently, while saving on massive overhead charges. These low rates are definitely worth bragging about.

Anytime, Anywhere

Ever since we have said goodbye to the screech ridden days of dial-up internet, there is virtually no need for anyone to wait for technology to do its job. With the constant accessibility to cellphones and/or tablets, there’s no reason why you as business owner shouldn’t be able to take payments on the go.

A Variety to Choose From

“I hate having options”, said no one ever. Luckily for merchants everywhere, ProPay has several Swipe options to choose from. Whether you are looking for something simplified or something that can work both on and offline, there’s an option for you and your business.

  • JAK- With the ProPay JAK, you can take payments directly from your Android or Iphone, anywhere, anytime.

  • Card Reader-Regardless of whether you have a stable internet connection or not, ProPay’s Card Reader allows you to take payment both off and online.

Low rates, constant accessibility, and a variety of options to choose from are just a few of the reasons that make ProPay the number one provider to choose from. To learn more about ProPay, click here.

As a business owner you have to deal with the many ups and downs that accompany ownership–including credit card merchants and processing companies. When first looking at your credit card processing statement, you might skip across a few key components but there’s one in particular that’s important to understand: Effective rates. Effective rates are the combination of the total processing fees divided by the total sales volume.

How Do They Work?

Now that we know what effective rates are, how do they work exactly? Merchants will charge different transaction fees based on the type of transaction and the type of card used. For example, a customer at a retail store (the type of transaction) uses a qualified consumer credit card (the type of credit card).

An Ode to the Percentage Rate

You’ve all seen them, merchant providers advertising “rates as low as xx%” but how many transactions will actually qualify for that specific rate? Let’s look at an example below that exhibits the type of card along with the transaction rates and hidden fees:

Type of Card

Transaction Rates & Fees

Qualified Regular Consumer Cards

1.48% + $0.20

Qualified Rewards Cards

2.20% + $0.20

Typed or Keyed in Commercial Cards

2.91% + $0.33

Non-Qualified (US Govt. / Outside of US

3.75% + $0.33

How Can You Calculate an Effective Rate

Learning how to calculate your effective rate comes with a list of equations such as: r = (1 + .05/12)^12 – 1, or r = 5.12 percent. However, using ProPay’s fee structure will help you put those days of long and monotonous calculations aside. Need an example? Let’s look at the chart below:

Calculating An Effective Rate*

(Based on: Average Monthly Processing = $2,000; Average Transaction Size = $200)

Typical Fee Structure

ProPay’s Fee Structure (Swipe)

ProPay’s Fee Structure (Keyed)

Application Fee

$25

$0

$0

Annual Account Fee

$0

$49.95 (Premium Plus Account)*

$49.95 (Premium Plus Account)*

Monthly Fee

$0

$0

$0

Monthly Minimum Fee

$20

$0

$0

Monthly Statement Fee

$4.95

$0

$0

Contract Term Commitment

2 years / $95 Cancellation Fee

n/a

n/a

Terminal

Required

n/a

n/a

Terminal Cost

$479

n/a

n/a

Terminal Lease Cost

$50 / month – 12 month lease

$35 / month – 24 month lease

n/a

n/a

Virtual Terminal (keyed transactions over the Internet)

$179 or $8 / month

n/a

n/a

Sign up / Approval Time

5-7 days

Within minutes

Within minutes

Processing Fees

Qualified Consumer / Card Present / Card Swiped

1.48% + $0.20

2.29% +$0.25*

2.29% +$0.25*

Qualified Rewards / MOTO / Internet

1.99% + $0.27

2.99% +$0.30*

Qualified Rewards

2.20% + $0.20

2.99% +$0.30*

Keyed or Typed In / Commercial Card

2.91% + $0.33

2.99% +$0.30*

Non-Qualified

3.75% + $0.33

2.99% +$0.30*

Effective Rate Comparison

Processing Fees

$510 ($1.99% + $0.27)

$579.60 (2.29% +$0.25)

$753.60 (2.99%+$0.30)

Other Fees**

$982.40

$49.95

$49.95

Total Cost

$1492.40

$629.55

$803.55

Effective Rate

6.22%

2.62%

3.35%

* Based on research conducted in January 2011

** For this example the following fees are included in the calculation: Application Fee, Monthly Minimum Fee, Monthly Statement Fee, Annual Terminal Fee, Annual Virtual Terminal Fee).

The Solution

Understanding effective rates can come with a long list of complexities and hidden fees. At ProPay, there are no hidden fees and we make rates as transparent as possible. Our motto? It’s simple–what you see is what you get—a simple, straightforward, non-variable rate with no hidden fees and the most flexible options for processing cards anytime, anywhere. Learn more about ProPay here.