Retail Merchant Account Rates

Merchant account rates are the sum of interchange rates and the processing costs incurred by the merchant bank. Following is a breakdown of retail merchant account processing rates and our suggestions what you should be looking for (or you can just visit our website).

• Discount rate. You should pay no more than 1.69% for credit cards and 1.40% for debit cards. These are the rates for consumer cards which are the most widely used. Various business to business, rewards and other cards often get charged at a higher interchange rate (the base processing rates set by Visa and MasterCard). You need to ask your merchant services provider what pricing structure they are using. The best choice for you will be the pass-through pricing which will ensure that the payment processing costs they add to the interchange fees are the same for all types of cards and you will not get overcharged.
• Transaction fee. You should not agree to anything higher than $0.20 (it will be the same for debit and credit cards).
• Set up fee. You should not pay any set up or application fees!
• Monthly maintenance fee. Every merchant account provider will charge you such a monthly fee, although they might give it different names. You should not be paying more than $10.
• Support fee. Another monthly fee. You should not pay any such fees.

You will also need a payment processing terminal and your merchant account provider will provide you one and configure it to work with their system. You can purchase the terminal from a third party as well. Other than that, be sure to carefully review the whole merchant processing agreement for charges that may make it more expensive than it seems.