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Credit Card Fees - Choosing A Processor And Gateway.

In the past choosing a processor felt like buying a car and you really didn't have control over the rates you were charged.  Swipe vs card not present and the different tiers of qualified or unqualified any given card could fall under.   You could get quoted a low ball rate but it is at the processors discretion as to which tier a card falls under.  

Today the choices are much easier.  Paypal charges 2.9% +.30/transaction for web payments.   Intuit charges 1.75% +.25 if swiped (mobile phone app included).  If you don't need integrations, Square's rates start at 2.75% per transactions.  The problem with square is it is a closed system without any api access.     The end result at least for small merchants is more choices for an easy to understand rate structure.

New payment systems such as dwolla only charges a flat 25 cents per transaction for anything over $10.  The key is the customer has to have a dwolla account that is tied to their own bank account.  It seems to act more like an electronic check.
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COBOLdinosaur2014-11-16 07:54 AMID: 133963
Users drive the system, not merchants and they don't know or care about the processing fees.  The problem is actually worse for brick and mortar where the premium cards  issued by banks but bearing the Visa or Mastercard logo have a higher fee then regular cards, and a merchant has to eat the higher rates or they cannot accept any cards.

It is just the same old game of those with the cash dictate the rules, and if you try to do anything that threatens their margins the lobby the government to kick merchants in the ...

As long as they can convinces the average sucker that reward points for using this or that is a good deal, the merchants both online and conventional will get beat up.

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Scott Fell2014-11-16 08:56 AMID: 133966
Your right, people don't realize that in the end you are paying for those "points" or perks offered.  The merchant is the one that directly has to pay for the points but that eventually reflects in the price.

I have attached the Oct 2014 US Interchange rates from Visa.  I downloaded from

There are a lot of different rates, but for the purposes here, the rates on page 10 will represent what the merchant services provider are being charged for ecommerce.   Ranging from 1.8% + 10cents/transaction to 1.95% and 2.4%.   Smaller merchantes will probably do best with the "simple" rate fees such as paypal.  When shopping merchant providers, you want to take into consideration all fees.  Estimate total $$ to go through your ecommerce account and the average sale to figure the transaction fees.  Some processors will have other fees such as statmentment fees.
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Gary2014-12-03 08:15 PMID: 136867
So this ties in with the PCI complaince?
One company I came across recently, and looking at using, offering good rates was there was another company and their name escapes me now, they were operating in the US but and were doing the same kind of rates.
If you are a small business and wanting to do CC payments then you are going to be paying premium rates for it period. If you are doing 10 million in sales then you can start negotiating the rates, I think even PayPal "offer" this
You also have to take into account that all web payments are high risk so you will never get the same rates as an high street shop with customer present.