Merchants really are at the mercy of the credit card industry. They have a fee for transaction integrity or TIF, and the CPS fees or customer payment services fees, for keeping merchants and merchant accounts in line with the rules. If a merchant fails to comply with the information the companies need, then a fee is accessed based on the lack of information collected from the merchant. These fees will in fact drown out the profit of a merchant, behooving them to follow the rules, and read the regulations put forth from the credit company.
One of the easiest ways for a merchant to comply is installing the correct machine to do the job. Not only that, but make sure all the settings are in place to meet the required information. Additionally, talking the customers into using their debit portion of the card, making it even harder for someone that has stolen the card, to use it. This little PIN number instills the information to the credit company that in fact, the correct user has just made a transaction. With this credit feature in place the credit card company charges less in fees for debit transactions than it will for credit purchases.
Another charge for merchants happens online, and over the phone card not present transactions. With billions of dollars at stake, and with top dollar fees being used, the simple use of an address from the customer will decrease the TIF fee. Merchants need to just insure that the user of the card types in the address online or from the phone conversation, with the employee, and requires the address information. The AVS fee that comes over and above the TIF fee will be greatly reduced and cause less theft in the long run.
One last thing as a merchant, if you batch your sales out at the end of the day, two things happen. The card processor will charge you a much reduced fee, than if you waited. And with the batches done at the end of the day, your money will begin to come in faster. It’s a win/win situation and one that as a merchant, you should be paying attention to. These costs could over run your business altogether.
All in All
If you have shopped for a good merchant account and you follow the rules, your credit processing should be a great experience. If you fail to comply, not only are you costing yourself some substantial cash, but you are risking your business. Take the steps to keep the TIF fees low. Avoid the AVS fee for the non-card purchases, and insure that your machine has been programmed to get the required information to appease the credit card companies. It will be smooth sailing and wonderful extra cash in the business account if you just follow a few easy steps. Keep your employees up to date on any changes that have occurred and then everyone can reap the profits instead of the fees costing you.