Credit Card Processing Blog
What Are Some Basic Things To Know About Credit Card Processing Fees?

Jan 8, 2016 05:40 PM / by Reliance Star

Owning a credit card sort of takes the edge off owning things you wish for or even providing for yourself. However, credit card processing fees can be extensive and complicated. You may find different rates than you agreed to or mysterious titles on your statement that you don’t understand. If you are considering a credit card, you should first have an understanding about credit card fees rather than paying them blindly. This way you can decide what card works best for you and your budget. Here is just some basic information to get you started:
Your quote rate vs. your actual rate        
Your initial move towards getting a credit card will start with receiving a quote that fits your interest. This quote will only be for your lowest-risk transactions considering it is the cheapest therefore most appealing. When card companies process transactions, they only accept a certain amount of risk. If they are met with things such as chargebacks and fraud, the money still needs to be accounted for. This is the reason why they base their rates off of an anticipated risk of transactions. Usually, processors give the most qualified transactions the lowest rates and the rest have higher rates.
What does it mean to be qualified?
A card-present transaction is an example of a qualified transaction. This is when a consumer is physically there to swipe their card through a terminal. While that is the general idea of qualified, the card processing companies may have criteria of their own. Card-not-present and online transactions will ultimately have higher fees considering they are of higher risk.
If a customer decided to dispute a charge, as previously mentioned, someone has to be held responsible for the money. The dispute itself is known as a chargeback and merchants and banks are faced with them too often. Once the dispute is in, the issuer investigates and if they are in the customer’s favor, they will refund the customer. Then they turn to the merchant and demand payment as well as an additional chargeback fee. It is reasons such as chargebacks that has issuers and merchants on their toes with credit cards. This results in the headache of credit card fees.