Processing Companies

There exist various merchant processing companies that offer merchant solutions to accepting credit cards, debit cards, and other forms of payment. There are a few things to consider before picking the right processor.

1) What are the rates for processing Visa/MasterCard
2) What are the monthly and annual fees involved?
3) How long is the contract for, and how much is the cancellation fee?

There are really 2 different pricing methods for accepting Visa/MasterCard: 3 Tier Pricing, and Interchange Rates.

Interchange Rates:
Visa/MasterCard issue some 200 different types of credit cards, offering all sorts of bonuses and points to their users. In reality, it is the merchant that pays for the customer’s points on these cards. Each card is issued a percentage at which it will be processed through the merchant’s credit card processing. In addition the merchant will pay several basis points (1 basis point is 1/100 of a percent) and additional cents per each transaction.

3 Tier Program:
The 200 different types of credit cards are lumped together into three different categories: Qualified (cheapest), Mid-Qualfied, Non-Qualfied (most expensive) cards. Each card is processed at a fix percentage in one of these categories. In addition the merchant will pay cents per transaction on each card.

Typically the interchange program is the cheapest program. Merchants should shop around a bit before committing to one program because the industry is extremely competitive. Merchants should also know which lenders are compatible with which processors, as lenders are not compatible to split processing with all merchant services.

A list of some of the processors that are compatible with lenders:

Integrity Payment Systems

Evo Merchant Services

First Data

Heartland Payment Systems