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Internet Merchant Account Rates & FeesIf you plan on opening an internet merchant account, make sure that the price you are quoted includes ALL rates and fees. There may be additional costs (such as annual fees) that may be hidden in fine print.Setup Fees Application or Setup Fee This is the initial fee some merchants are charged for processing the merchant account application or opening the merchant account. Many merchant account providers do not charge application fees. Re-programming Fee This is a charge assessed for reprogramming your existing software or terminal. This fee can usually be negotiated, especially if you are anticipating a high sales volume. Discover Account Activation Fee Discover will charge a one-time fee of $50 to allow you to accept Discover cards. Some merchant account providers may also try to charge you site inspection, installation, or training fees. These are just excuses to add more fees. Dont pay them! Recurring Fees Discount Rate This is a fixed percentage that is taken from each sale. For internet transactions, this rate is generally between 2.25% and 2.75%. Non-Qualified Surcharge This is an additional rate that applies to certain types of credit card transactions. Transaction Fee This is a charge assessed to each credit card transaction that is submitted by the merchant. This fee is generally between $0.20 and $0.30. Monthly Statement Fee - A monthly fee that should cover the costs of the monthly statements, customer service, underwriting, and all other services. Monthly Minimum Fee A fee charged if the total monthly discount rate amount does not add up to the monthly minimum. For example, if your monthly minimum is $25, and you only pay $10 is discount fees one month, then you will be charged the additional $15. Monthly Gateway Fee This fee is assessed to provide merchants with the ability to process transactions securely over the internet. Monthly Shopping Cart Fee If you have a website that uses shopping cart software to process your credit card orders, then may have to pay monthly fees to use this software. This is often provided by the web hosting company. Click here for more information about using shopping carts to process your credit card orders. Address Verification Service Transaction Fee (AVS) This is a fraud-reduction service that verifies the billing address provided by the cardholder with the credit card company before approving a transaction. Many transactions that are keyed will have to pay an AVS transaction fee. This should not be more than five cents per transaction. Daily Batch Fee This is fee paid for processing each daily batch. Batches are usually processed each day that the merchant has transactions. If you do not do this at the end of the day, then your transactions for the day will automatically be charged non-qualified surcharge fees. Chargeback Fee - This is a fee that is charged when the cardholder disputes a charge that is found. Annual Fee - Some merchant service providers will charge an annual fee. These fees usually arent disclosed upfront, so make sure you read the fine print! Contractual Terms & Termination Fee When you open a merchant account, you may be required to sign a one to four year contract. These contracts will generally have a termination fee that ranges from $150 to $600. |
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