Credit Card Processing

credit card processing

Credit card processing rates can range from 1.5% to as high as 5% depending on your industry and the credit card processing company that you decide to handle your credit card transactions.  This is a huge difference to your bottom line if you dealing in lower profit margin retail small business.  When most small business owners decide they want to accept credit credits they often move to the quickest and easiest way to get set up without checking all cost for the processing services.  In general if you’re paying over 2% in total fee’s your leaving money on the table and need to consider looking at other credit card processing companies.  When you’re dealing in small percentage numbers it can get overlooked as small potatoes, but if you do the math the rates make a big change to your bottom line and profit.


Average credit card processing fee (all in) of 3.25% x yearly sales of $ 750,000 = $24,375 Fee’s

Average credit card processing fee (all in) of 2.00% x yearly sales $750,000 = $15,000 Fee’s

That’s a savings of nearly $10,000 that goes directly to your bottom line.

Not sure if you can save any money on credit card processing fees?  Currently, 80% of the merchants who have us do a rate comparison were able to save 20% or more on fees!

Would you like a comparison rate quote now?  All we need is 1 to 2 months of credit card processing statements and we will issue a line by line cost savings comparison for your review.  We are standing by at 1.877.876.2803 to discuss how much we can save your small business.

With all the demands of running a business, shopping for a competitive credit card processor might seem trivial. Yet a healthy dose of reality can go a long when you see how much additional cash will flow to your bottom line.

Take, for instance, a 110-seat restaurant that does roughly $2.4 million a year in sales--80% of that on credit card accounts. Saving just 1.25 points off of those processing fees equates to savings of $25,000 a year.  That could put a daughter or son to college for a year for a small business owner.  Not bad for simply letting someone take a look at your credit card processing statement and provide a cost savings quote.

In the case of Visa and MasterCard when a credit card is swiped, the transaction gets relayed--via an intermediary--to the credit card company, which then sends the funds to the merchant's bank account. That middleman charges the merchant a fee 1.5% to 5% of the sale for the transaction and the processor pays a fee to the credit card company.  

Letting your bank handle credit card processing is convenient, but normally cost more.  You’re almost always better off using one of the third-party service providers such as Merchant One or First Data.

Fees aren't the only consideration when choosing the right credit card processor. Service and quick responses can go a long way in terms of overall value. Terms are almost always negotiable, so knowledge is your best weapon. Here are some things you should be looking for.

Equipment. Credit card processing machines can run between $300 and $800 apiece. (Some systems involve software, too.) Top vendors include Micros, Aloha and Squirrel, but some merchant processing companies offer equipment as part of a package.   You will also need a way to connect to the processor, usually either a separate telephone line or the Internet.

Payment lag time. Another very important factor is the time it takes to get your customers' cash. The payment lag time can be anywhere from one to five days.  Obviously, the quicker you get your money, the better.

Fees. A base rate of 2% of sales is typically good. Unfortunately, there is no one magic resource for comparing processing prices. Banks normally charge the most fee’s and have the highest overall cost as a percentage of sales.  Third party credit card processing companies normally have the best deals.  We have found great offers from Merchant one and First Data.

Remember that credit card processors must pay a fee to Visa and MasterCard, which typically charge at least 1.5% for a normal credit card transaction.  So if you see some crazy low base rate of .35% or 1%, it’s a bait and switch deal.  That kind of structure is simply not possible as the processor must pay the Visa and MasterCard at least 1.5%.  Most likely the deal is filled with silly add on fee’s that normally add up to more than 2.5%.  Its common in this industry and you need to get out your calculator and add all hidden charges. 

All the credit card processing contracts will likely have some confusing hard to understand language. To get a better understanding of the deal, ask to see a typical monthly statement itemizing every transaction and its related fees. offers a free rate comparison service.  Simply apply online and email or fax us 1 to 2 months of credit card processing statements.  We will have a comparison quote ready for you within a few hours of receipt.  If you prefer to discuss the program over the phone you can reach us at 1.877.876.2803.

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