Admit it, you clamed up a little bit when you just read that. The word itself conjures up images of fat cat bankers rolling around in piles of your hard earned money, and dubious lawyers that bury clauses in fine print. A fee implies a penalty…money taken from you for no particular service rendered.
In merchant account services, just like any other businesses, there are of course costs involved. The vendor that provides such services has to cover their expenses and can be expected to make some small margin off the service they provide. Fees, however, are a different animal altogether.
At Merchant Solutions, we waive a variety of “fees” imposed by certain merchant account providers. These fees include but are not limited to:
- Application fee: would you believe some merchant account providers charge you to process the paperwork to even see if your eligible to work with them? This is common of setting up your processing account via a bank.
At Merchant Solutions, we don’t charge application fees.
- Set up or activation fees (or terminal download fee): another fee we’ll see from time to time some merchant account providers impose (again, often banks), are set up or activation fees. The only time such a fee makes sense is if you are using a third party service which imposes the fee – gateway set ups or wireless terminal files, for example. Otherwise, this is just another way for the processor to pad their pockets.
At Merchant Solutions, unless third party services are ordered (like a gateway or internet shopping cart, etc) there is $0 set up fee.
- Monthly minimum fees: Monthly minimum fees are often times the last thing on a merchants mind when they are establishing a processing account, but can come back to bite you in many ways. A monthly minimum fee is a surcharge imposed basically for not processing enough volume in a given month. This fee is imposed on top of any other fixed costs, such as a statement charge. Therefore, if a merchant has a $10 statement charge and a $25 monthly minimum and took 0 transactions in a given month, they’d be billed $35. First this is of course a major consideration for seasonal merchants or merchants that only run sporadic transactions. But even for regular processing merchants with a stable business, this could come back to bite you when you’re ready to reevaluate accounts in the future. In the previous example of a $10 statement fee and $25 monthly minimum, if you were to try to switch processors for lower rates or better service, you’re still on the hook for $35 per month to the old provider for the duration of your contract if they impose a minimum.
At Merchant Solutions, we provide a $0 monthly minimum.
- Annual Fees: an annual fee is there to put money in the processors pockets, period. At merchant solutions, we offer no annual fees for all merchants. The only exception would be when working with certain “high risk” business types for which we need to work with outside vendors as the only means to get the account approved (in which case the merchant will be notified prior to submission).
At Merchant Solutions, we provide a $0 annual fee.
- Early Termination Fees: its been said “if you love it, let it go”. And while that may be good poetry, we find it good business practice as well. If you’re in talks with a merchant account provider that needs to impose a significant cancelation fee in order to retain your business, you may want to consider the legitimacy of such a vendor.
At Merchant Solutions, we retain our clients business through excellent rates and unbeatable service, not fees or penalties. Therefore, we offer a $0 early termination fee.
In addiont to upfront fees to look out for, in our statement analysis we often find a number of what we refer to as “junk charges”. These are fees that merchant account providers will slide in over time in order to up their margins on your account. These include:- Debit Access Fee: here is one I’ll regularly see in statements sent in for analysis. Typically this is a $5 or $10 surcharge to accept PIN debit. On the merchant account provider side, there is no such fee. Basically, they impose this to try to recoup some of the money they are losing by providing PIN debit, as the merchant account provider makes more on credit than debit transactions.
Merchant Solutions debit access fee is $0 – always has and always will be.
- IRS Reporting Fee: Here’s a new one I see popping up. I’ve see fees as high as $25 monthly. What is an “IRS Reporting Fee?” Another junk charge is all. A merchant account provider is required to keep a W9 for your business on file and electronically submit your processing volume to the IRS in Jan.
Merchant Solution’s IRS Reporting Fee – $0.
- Unnecessary Gateway fees: I’ve seen a number of merchants, particularly through one specific provider whom I will not here name, get charged a “Gateway Access Fee”. This is a monthly fee that can range from $10 to $150. And while a gateway fee can apply for merchants that actually need a gateway to process (to facilitate integrations such as with an Ecommerce shopping cart, point of sale or order management system), it is NEVER needed by a merchant with a standalone terminal. If you have a standalone terminal and there is even a penny of “gateway fees” on your statement, that’s simply a bogus charge.
- “Additional Charges”: this is another one I see from one specific processor all the time. At the end of the statement, there will be a “Summary of Misc fees” which include statement fees, batch fees, and other legitimate charges. Then the last line item will say “**Additional Fees” and have a flat amount next to it, and a number to call if you would like an explanation of these fees. The only thing I can think when I see that is “seriously?”
- PCI non-compliance fee: This one is a bit tricky…not sure I want to call this a “junk fee” but do want to address it as I see way too many merchants paying this. As well, this is not to be confused with a “PCI Maintenance fee” or “Regulator Compliance fee”, which are both legitimate charges as long as they are nominal (basically, if they aren’t charging it separate, they are making up for it somewhere else on the statement). A PCI non-compliance fee is different, and there are several reasons you can receive such a fee. This could be that you are using a non-PCI compliant terminal, a non-supported integration into a payment system, or that you have not completed the self assessment questionnaire (PCI SAQ). The reason I list this as a “junk fee” is it is completely unnecessary – at Merchant Solutions, we only work with PCI compliant equipment and systems, and can ensure you maintain PCI compliance, and will continually monitor and automatically notify any merchant that falls out of compliance, not just stick a surcharge on their statement.
- Duplicate transaction charges: This one often takes a trained eye to spot, and is a particularly dubious trick. In this set up, a merchant is charged multiple times for the same thing, thus rendering one of the two a “junk charge”. Here’s how it works. A merchant account provider quotes a merchant a per transaction charge lets say, for arguments sake, of $.10. The statement, however, will show a $.10 per transaction charge, then later down the statement, a duplicate $.10 per authorization charge. This has become increasingly common. Sometimes this duplicate authorization charge is hidden in a line item that says “Assessments / Network Trans Fee”. Unless you knew to net off volume x .11% and then divide the remaining amount by the number of transactions ran, you’d never know that fee was hidden in there.
At Merchant Solutions, we charge a simple flat, clearly stated per transaction fee, with no separate hidden per authorization fees.
If you’re interested in learning more about processing your transactions via Merchant Solutions, or if you are currently processing and would like a review of your statement or contract for “junk fees” that can readily be eliminated, don’t hesitate to reach out to us. Our contact information is below, and our knowledgeable staff will be more than happy to provide a fair, honest, and thorough analysis of your processing situation.Request a return call or email: http://www.merchantsolutionsllc.com/contact/
Merchant Solutions, LLC
12 North Main St
Suite 44
West Hartford, CT 06107
Phone: 866.326.3480
Email: contact@merchantsolutionsllc.com
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