The Different Fees That Merchant Account Services Charge

By Author: Richard Cooper
Total Articles: 32
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Registration fee, gateway fee, processing fee, discount rate, monthly minimum, statement fee, and technical support fee are the main heads under which a trader will incur charges from his merchant service providers. Some merchant account services waive off certain fees, producing a semblance of cheapness. Still, in most cases, low rates for one service are often balanced by high rates for something else.

Of the various fees, registration fee is a onetime fee necessary for signing up for the account. There can be substantial difference in the registration charges of different merchant account services. There are many merchant account services that charge no registration fee at all while there are those which charge up to $500. A merchant service, which does not charge any registration fee, makes it up by hiking the charges under other heads.

The next, the gateway fee, is the monthly charge for the gateway required for accepting credit cards for processing. Here also charges vary from the zero charges of some merchant account services to a charge of $30 or $40 for others. Next is the processing fee, which the trader ...
... has to pay the merchant service for every transaction. This can be as low as 0.10 dollars but again can be more though not ever exceeding one dollar in any case.

Discount rate is also part of the transaction charges. It is a fee that the merchant service withholds from every transaction. The amount withheld, as discount rate charges are an average of 3% to 4% of the transaction amount, though discount rates could also vary substantially between different merchant account services.

Monthly minimum is the minimum amount that a trader will have to pay his merchant service. If a merchant account services sets the monthly minimum as $30, and if the processing fee and discount rate charges of a trader work out to $30 or above, then he will have to pay nothing extra by way of monthly minimum. But if these charges add up to only $20, he will have to pay his merchant account services an additional $10 to satisfy the monthly minimum limit.

Statement fee is the fee charged by the merchant account services for providing the transaction details, as and when required. Technical support fee is the charges for various technical supports like setting up the whole system, integrating the shopping cart, or troubleshooting when problems occur. The fee charged under this head will depend upon the extent of technical support provided by the merchant service. Some merchant account services list it as a separate fee while some others incorporate it into the registration fees.

Understanding these different types of fees will help a trader in selecting the right merchant account services.

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