Generally speaking, the average cost to a business for processing a single credit transaction is between 1.95% to 2.50%. This is influenced by a variety of factors, including the contract you signed in the first place and which credit card processor you’ve chosen to work with. Rate spikes rarely happen very suddenly – they often happen slowly, a fraction of a percentage point at a time, over long periods. If your rates have already established a pattern of creeping upwards, rest assured it will probably continue like that for the foreseeable future. If it’s getting to the point where you’re uncomfortable, it may be time to look elsewhere for a better solution. At the very least, it might be worth contacting your credit card processor to see if there is anything that you can do to stop creeping rates in their proverbial tracks.
One of the fees that you’ll always want to keep a watchful eye over is called the interchange fee. Processors have no choice but to accept the Cost of Interchange, but each company can tack on an additional percentage to make their profits. This fee can dramatically affect the total amount of money you’re making on a purchase, so it’s always a good idea to make sure you’re comfortable with the terms and conditions of any one provider moving forward. Even if you can’t stop accepting Visa or MasterCard, you can still adjust your prices accordingly to take the fee into consideration.
Other fees that you’ll want to pay attention to include those that you’ll be charged in the event that a customer successfully executes a chargeback, and fees associated with debit card versus credit card charges.
Finally, you’ll definitely want to review any regulatory or compliance changes that have been passed recently to make sure that you’re ready to go in the wake of upcoming deadlines. For example, did you know that EMV (also called chip-and-PIN) cards became mandatory in the United States in October 2015? If you didn’t, don’t worry – the Wall Street Journal reports that you’re not alone. Many merchants have failed with switch over to new payment processing hardware designed to work with these chip-and-PIN cards, and they’re opening themselves up to pretty significant fines if they don’t correct this sooner rather than later. Don’t fall into this trap – make sure that you know what will be required of you during a transaction and make sure you’re compliant this season.