As an Independent Payment Processing representative, I am able to select who to partner with, enabling me to match you to the provider that best fits your needs. Beginning in the Spring of 2020 I partnered with Rev19 Payments – Now Agile Financial Systems(AFS) to provide best of class payment processing to my clients. Rev19’s core values – Simple transparent pricing with no hidden fees, no long term contracts, and no equipment leases.
Rev19 Payments offers many services for business owners, including: Interchange Plus Pass-thru Processing, Dual Pricing, Surcharge Processing, Contactless Terminals, Wireless Terminals, Mobile Terminals, POS Systems, Virtual Terminals, and Payment Gateways.
Contact me to see how Merchant Partner and Rev19 can help you achieve your business goals. Merchant Partner serves the Brainerd Lakes and surrounding communities.
The pace restaurants and other business’ have been adapting online ordering to remain competitive or even just to keep their business alive has accelerated in recent months. For some partnering with one of the 40 plus new delivery services appears to be a good solution, others are finding those services to be cost prohibitive, just as many rural florists before them discovered in their industry as well.
Biteheist Ordering for the Web or Mobile App
One alternative is to take orders yourself through a service like Biteheist that allows you to load your menu online and get orders by email, text or directly to a POS ticket printer. You don’t need to have a POS system to use this service, however you can save on the monthly fees when you bundle your payment processing with Biteheist.
Paradise POS with Online Ordering
If you don’t have a POS yet, this maybe just the timing as many POS systems allow you to use your same menu to populate your online order menu. Systems like Paradise POS include online ordering as a standard feature for no additional cost, many other systems offer a delivery module for an additional fee. Paradise will even allow you to set expectations for when an order will be ready by allowing you to add additional wait times during peak hours and to update it on the fly. If you are providing delivery services Paradise will also print and additional ticket for the delivery driver with a QR Code they can scan to get delivery directions in Google Maps. Creating your menu once and having it maintained for online ordering will save you time in maintaining your pickup/delivery menu – you can also select which menu items you want to show online.
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Contact us to discuss how Merchant Partner can help you. I can arrange POS demo’s to enable you to select the system that is right for your business.
Take a quick moment to look over your monthly merchant statement -unexpected extra fees can pop up at any time. You should be familiar with what your standard monthly/quarterly/annual fees are you will notice if something has been added or increased. Also be sure to read processor notes commonly at the end of your statement this is where you can see a heads up for new fees and changes to your account. Call Support or your local rep to see what benefit these provide and if they are required.
One of the most common items I see is clients being charged a PCI non-validation fee month after month This can commonly run $19.95 a month to over $100. I just reviewed a clients statement and found they were charged and extra $19.95 in January even though they passed their compliance scan on the 1st of the year – apparently since their billing occurred the same day as the scan they didn’t show as being compliant. This was on top of finding and additional $18 dollars a month in new optional fees last Fall that were not required and were unwanted. An additional $40/month can really impact the effective rate paid by a small business.
If your rep is not looking out for you it maybe time to find one that will.
There are several considerations, First what is legal? Second what do your terms of service for accepting credit cards permit? Third is it a good idea?
As of 2010 the Durbin amendment allows the Fed to set a minimum credit card purchase amount – currently $10. I didn’t find a law prohibiting debit cards – however most credit card issuers prohibit it in their terms – so when you agree to accept their cards you are agreeing to abide by those terms – potentially if you were only accepting a card type that did not prohibit it you could – however you need to treat all cards, banks, customers the same so if you are accepting all major cards you would be prohibited.
So Credit cards – yes, but debit cards – no; however just because you can doesn’t mean you should. It’s generally not popular with customers, so consider the impact. You should also look at what it is actually costing you – the amount may not add up to enough to deal with an unpopular policy. Do you know percent of your purchases are under $10? Also consider that you pay a much higher rate for a $1 purchase than a $9 or $10 purchase. For example if you have many purchase under $5 you could benefit more from such a policy than if they are closer to $10 or if you have very few purchase in this range.
Here are some examples of Interchange fees for purchases of $1 and $10 showing the effective rate interchange is costing you for the sale – keep in mind you will also pay processing fees in addition to interchange and that all processors pay interchange regardless of how they structure your pricing.
Basic bank issued credit card $1 purchase = 5.65% in interchange
Basic bank issued credit card $10 purchase = 2.05% in interchange
UnRegulated Debit card $1 purchase = 5.55% in interchange
UnRegulated Debit card $10 purchase = 1.95% in interchange
Regulated Debit card $1 purchase = 22.05% in interchange
Regulated Debit card $10 purchase = 2.25% in interchange
Basic rewards card $1 purchase = 12.1% in interchange
Basic rewards card $10 purchase = 3.1% in interchange
You may find marketing to be a better solution than implementing a minimum purchase amount. For example you could sign low cost items as 3 for special price to increase the sale amount/profit margin while lowering the interchange effective rate at the same time.
Even though you can only set a minimum purchase limit for credit card purchases the reality is that many consumers won’t differentiate between debit and credit and will comply with the policy regardless of payment method, if not paying by cash or check.
Ultimately you will have to determine if the potential reduction in your processing effective rate is worth the customer reaction to the policy – for some businesses it will be worthwhile for others it may not be.
Does your daily life require more than a flip phone? Maybe you business does as well. You don’t have to invest thousands into a full blown POS computer to improve how you take payments for your goods and services. New smart terminals can offer you more than just accepting a credit card. You can easily create a menu for your offering without any technical expertise allowing for simpler check out and data collection. A smart terminal can start out as simple to use as a basic card terminal while allowing you to expand at your own pace. You can accept signatures right on the the customer facing screen with the option to print, email, or text their receipt. You can even connect to a cash drawer and replace your cash register.
Other options include the ability to take an order anywhere in your business and not just at the counter, you can also take payments anywhere. For a restaurant you could take an order at the table, fire the order directly to a kitchen printer and move on to the next table where you can take another order or cash them out to turn the table more quickly.
There is also an app store where you can load apps such as POS software, time clock/scheduling apps, or loyalty programs. Additionally they can improve the image of your business with a modern look and easily accept payments however you customers want to pay from cash to contactless payments like Apple or Samsung Pay etc and of coarse traditional chip or bar code cards.
Interchange Plus pricing also know as Cost Plus or Pass-through pricing is the most common credit card processing today and is designed to be very transparent so you know what you are really paying. This model should pass through Interchange charged by the Credit Card companies and the Card issuer fees (Assessments etc) at Cost and processing fees are covered by a small markup commonly called “discount” and a per item fee or Authorization fee. Additional fees may include a daily batch settlement, admin, paper statement, electronic statement, paper supplies etc – each of these fees should be clearly stated out in your agreement and not be a surprise when you get you first statement.
Sadly not everyone is getting charged what they agreed too. For example: this week, I came across a business that even though they were processing a lower than average volume had a discount rate that was exceptionally low, this didn’t really compute. On the surface they appeared to have a very competitive rate, however their overall effective rate told a different story as it was higher than average, even though they are taking in 45% of their transactions on debit cards! Upon further analysis I discovered all of their listed interchange fees were around 35% over cost and their processor was padding their fees! So even if you are quoted an exceptional rate that doesn’t mean you are actually getting them.
A business owner reach out to me this week with a few questions, one was regarding AVS Fees, they are on Cash Discount processing, so would normally not have any processing fees, however their contract included an additional Address Verification Service (AVS) fee, typically this either passed on at cost ($.01) or is covered by the per transaction fee, in this case the fee is $1.95 every time they use the AVS – which is prompted for in all Card Not Present (CNP) transactions. For a delivery business, such as a Pizza restaurant or a Resort taking room deposits over the phone you could trigger this fee frequently. Not using the service could get your transaction downgraded and you will incur a higher fees
I don’t think it would be wise to recommend bypassing AVS, even though some believe it’s antiquated and sometimes results in lost revenue. I would recommend reaching out to your processor to see if terms can be re-negotiated to make sense for how you operate. In the case of the cash discount client a downgrade would adversely affect the processors margins. Where as in traditional processing it would affect the merchants margins and depending on the amount of the sale potentially more than the AVS fee. I could see where some merchants may choose to make a business decision to not utilize AVS in some situations if they have not had charge-backs and no merchandise is actually leaving their business – such as taking a deposit.
Don’t be in a rush to sign a contract on the spot – first ask what any fees listed are for and what triggers them to see how it will affect your business.
