Merchant Accounts Part 2: Three Basic Elements

life.marketing@yahoo.com (David Greyson) — Sun, 08 Feb 2009 03:07:00 +0000

Nothing is more frustrating than not knowing if someone is conning you...especially in the arena of Merchant Accounts. I wanted to point out to all the members of sta.rtup some of the basic things that you would be paying if you made application for a Merchant Account. By card present, I mean the customer is standing in front of you making the purchase. I will address Websites and Mail-order in the next blog.

When a credit/debit card is swiped on a terminal the first two fees I list happens on every account.

First of all, A discount or interest fee is charged. This would look something like 1.99% or more for card present [CP]. Getting the best discount rate is paramount to keeping more of your money home. My discount rate for qualified Credit Cards is 1.69%. My special discount rate for Debit Cards is 1.39%. Beware of arbitrary rate hikes, I know a merchant [who is now my customer] that experienced a rate hike 30 days after he signed up. Some companies offer a low discount rate up front, but they conspicuously add charges somewhere in the pages of the agreement.

Sta.rtup members can be put on my VIP Listing where I would keep your rates guarded from such increases. There are industry wide increases from time to time and those are mandatory. But I can guard you from some supervisor, who has had a bad hair day, deciding to try and increase your rates.

Secondly, a transaction fee is charged. It would look something like .35 cents. My Transaction Fee is .19 cents... so you can see how much this would save you. I have seen merchants hammered with as much as .80 cents on this particular fee. That's crazy greed, and my VIP List keeps you guarded against such idiot stuff.

Thirdly, a monthly statement is charged. This typically is in the $8-$10 per month range. My monthly statement is only $5.50. There's no need to stiff good merchants who are trying to make an honest income. I could promise you my monthly statement fee would never change.

In a nutshell here are my rates for these 3 basic elements.

Credit Discount - 1.69%
Debit Discount - 1.39%
Transaction Fee - .19 cents
Monthly Statement - $5.50

So, if you want to more information, then please feel free to ask questions in your comment or contact me at life.marketing-at-yahoo.com. I spelled out -at- to frustrate email harvesters. You'll have to put the @ symbol in the address.

In the next blog I will talk about "Setting Up A Website Account."

Merchant Accounts Part 1: Overview

life.marketing@yahoo.com (David Greyson) — Sun, 08 Feb 2009 02:38:00 +0000

Merchant Services gives you the ability to accept credit/debit cards at your place of business [store-front, restaurant, website, direct-mail, etc...] Every business needs to have a provider. If you don't have it you are denying a possible 50% increase in sales. 60%-70% of all transactions are via "plastic" now-a-days, and you can't afford to be without one. I've seen mom and pop operations go from a few thousand per month to many thousands just from adding the choice of using a credit/debit card. You must consider it to be a product or tool that you need to operate with. If you can get past this, then it's not such a terror as some make it out to be.

Next, you need to understand the industry at least a little bit. Merchant Services offers you the service of transacting your sales through machines called terminals, or via software, or websites. When the transaction takes place, the card is swiped through the terminal and within seconds an approval or denial is given to the merchant. At the end of the work day the terminal/software is batched out or settled to report your total sales for the day and begin the transfer of money from the banks of the cardholders to the banking account of the merchant. It takes approximately 2-5 days for funds to be deposited in your account, depending on the type of account you choose. Most providers offer you a back-office or internet login to your account so that you can see your current activity. This use to be free but now there's a minimal fee, with $4.95 being the low end and $9.95 being on the high end.

This is the concept in a nutshell. Finding a Merchant Services company that provides what you need is not the difficult part. Finding one that doesn't eat your lunch IS the difficult part. In PART 2 I will discuss "Choosing A Provider" and we will break it down in to some details so that you know what is going on with your account. After all, it's your money, right?

Viva-Transact

Merchant Accounts Part 2: Three Basic Elements

Merchant Accounts Part 1: Overview