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Online Business L(a)unch™ >
Setting Up a
Website:
Accept Credit Cards
> Merchant Account
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Discount
rate (2.29%-2.79%/transaction)
Discount rate
is a percentage deducted from each credit card transaction. This
rate for mail and internet order businesses is usually
2.29%-2.79%. Don't let a few tenths of a percentage point be the
deciding factor between two providers though: if one provider
charges 2.39% and another - 2.59%, you'll only save $2 for every
$1000 processed through your merchant account. Well, it is
important to get low rates but don’t let it be a deal breaker!
Transaction fee ($0.30-$0.50/transaction)
Transaction
fee is
also
deducted from the purchase cost in addition
to discount rate; it’s a flat rate charged per transaction and
it’s should be approximately 30-50 cents.
Gateway access fee ($10 - $25/month)
In
addition to your merchant account fees you may encounter extra
fees if using a third party to process in real-time on-line.
Since in most cases, the Internet payment Gateway provider (Miva
Merchant, Authorize.Net, VeriSign, etc.) is a separate company
from the merchant account provider, they charge extra fees. The
usual fee to pay for gateway access is around $10-$25 a month.
Chargeback
fee ($20-$30/instance)
Chargeback
occurs when the bank charges a sale back to a merchant. It may
cost you $20-$30 per fraudulent transaction.
Statement
fee ($0-$13/month)
Statement fee
is what some providers charge for issuing you statements on all
transactions at the end of each month. A typical statement fee
is $0-15/month.
Annual
fee ($0 - $99/year)
This fee
usually isn't disclosed upfront. Always ask your merchant
account sales representative for this information. In ideal
condition you should not pay any.
Application fee ($0-$295 one time fee)
Some providers will charge you for processing your account
application. Be sure to check that this fee is refundable if
your application was turned down.
Although common,
many providers waive these fees. Be sure to negotiate.
Remember,
most fees are negotiable. As a mail order business you may not
have much to bargain with, but the right provider will charge
few, if any of these fees.
Application fee ($0-$295 one time fee)
Some providers will charge you for processing your account
application. Be sure to check that this fee is refundable if
your application was turned down.
Although common,
many providers waive these fees. Be sure to negotiate.
Remember,
most fees are negotiable. As a mail order business you may not
have much to bargain with, but the right provider will charge
few, if any of these fees.
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