As if there is not enough to worry about in the credit card processing world, merchants are hearing a new term these days: Surcharging. While it is not a new term, it is getting attention, and it is not because everyone knows exactly what it is. This term, and what it represents, has been a mystery to merchant and customers for a long time. Because of this, we are here to tell you what surcharging is, and why it can affect your high risk merchant account.
No one likes extra fees, especially if the fees are “hidden”. This is what many consider a surcharge to be, because it is charged to the customer at checkout to cover the merchant’s card processing cost. This charge can be more for high risk businesses, because the processing fees are typically higher. The problem comes when customers are not told of this charge. On the flip side, if you tell customers that you are charging a bit more to offset your credit card surcharge for processing their card, they are liable to take it as you are complaining about their choice of payment.
Surcharges depend on your merchant account processor, and the charge amounts, be it percentages of flat amounts, are the same with within each card company. This can vary greatly, and this is why it is important that you look into obtaining a high risk merchant account. While all companies who accept plastic card payments are at a higher risk of having a fraudulent charge, not all merchant account providers understand this fact. High risk merchant account providers do understand this, and they are your best bet when you must accept plastic card payments. However, because of surcharges, you need to look far and wide to make sure that the high risk merchant account processor you choose is the best for you, your business, and your customers.
Like with many things, the cheapest rate may not be the best, but the most expensive rate might not be the best. Every company is different, and not every merchant account will work for every company. Take your time locating the right high risk merchant account for your company, because it is one of the most important business decisions you will make.