In the digital age, businesses are increasingly moving away from traditional payment methods such as checks and cash, and adopting electronic payment methods for B2B transactions. Electronic payments offer numerous advantages over traditional payment methods, making them an ideal choice for businesses looking to streamline their payment processes and improve cash flow. What are the benefits of electronic payments for B2B transactions? Faster payment processing Electronic payments are processed much faster than traditional payment methods. With electronic payments, the payment is transferred directly from the payer's bank account to the payee's account, eliminating the need for physical checks or cash. This significantly reduces payment processing time, allowing businesses to receive payments faster and improve cash flow. Increased convenience Electronic payments offer increased convenience for both the payer and the payee. With electronic payments, businesses can make and recei...
Continuing on with the merchant account fees from our previous post. Remember not all fees are charged from all service providers. These are the most common.
Monthly minimum fee
Sometimes a processor will impose a monthly minimum fee. If the monthly minimum is not met, the merchant is charged up to the monthly minimum to satisfy the minimum fee requirements.
Statement fee
The statement shows how much processing the merchant did and the costs incurred.
It reflects the number of transactions, total dollar volume and average ticket. This is a monthly fixed fee. Normally the statement is $8 to $10.
AVS fees
An Address verification service is used for fraud prevention. It compares the billing address provided by the cardholder with the card issuing bank's records. It verifies that they match.
Normally a 5 to 10 cents per item.
Bankcard authorization and transaction fees
Bankcards issued by Master Card and Visa charge an authorization fee is each time a transaction is sent to the card-issuing bank to be authorized. Normally between 10 cents and 20 cents, plus the interchange cost.
Nonbankcard authorization and transaction fees
American Express, Discover, Diners, and electronic benefits transfer (EBT), gift and loyalty cards.
The authorization fee is charged every time a transaction is sent to the card-issuing bank to be authorized. Normally between 10 to 20 cents.
PIN Based debit fees
Debit cards require that every transaction be electronically authorized. Each transaction is secured with the PIN number. Here is how PIN debits are priced.
If a merchant calls in a transaction for telephone or voice authorization. Normally the cost per voice authorization ranges from $0.75 to $1.50.
Batch fee
Settling, or batching is the act of sending a merchant's transactions at the end of the business day to the bank for payment. Batch fees are normally 10 to 35 cents per settlement.
Online merchant reporting fee
Normally reports are free, included with your virtual terminal, but if not some processors charge for online reporting. It can range from 2.50 to $10 per month.
Terminal repair or replacement
A simple warranty program that extends repair or replacement coverage to POS equipment. Around $5 to $10 per month.
Retrieval fees
When a transaction is disputed, a retrieval request is initiated. This fee is typically charged whether or not the chargeback is successful. Normally the cost is $10.
Chargeback fees
Chargebacks can be $15 to $25, per transaction if successful.
ACH reject fee
The same as an overdraft fee on a paper check. Its the fee imposed on a checking account by a bank when a check bounces, normally its around $25.
Annual fee
The amount charged annually for the merchant account. Not normally charged.
Payment gateway
Gateway fees range from $5 to $20 per month. Some gateways do more than process transactions. They can also store customer sensitive data like credit cards, identity verification and more.
Wireless gateway
Some gateways have a wireless option, that fee may be broken out. These fees are normally part of the gateway fees.
Monthly minimum fee
Sometimes a processor will impose a monthly minimum fee. If the monthly minimum is not met, the merchant is charged up to the monthly minimum to satisfy the minimum fee requirements.
Statement fee
The statement shows how much processing the merchant did and the costs incurred.
It reflects the number of transactions, total dollar volume and average ticket. This is a monthly fixed fee. Normally the statement is $8 to $10.
AVS fees
An Address verification service is used for fraud prevention. It compares the billing address provided by the cardholder with the card issuing bank's records. It verifies that they match.
Normally a 5 to 10 cents per item.
Bankcard authorization and transaction fees
Bankcards issued by Master Card and Visa charge an authorization fee is each time a transaction is sent to the card-issuing bank to be authorized. Normally between 10 cents and 20 cents, plus the interchange cost.
Nonbankcard authorization and transaction fees
American Express, Discover, Diners, and electronic benefits transfer (EBT), gift and loyalty cards.
The authorization fee is charged every time a transaction is sent to the card-issuing bank to be authorized. Normally between 10 to 20 cents.
PIN Based debit fees
Debit cards require that every transaction be electronically authorized. Each transaction is secured with the PIN number. Here is how PIN debits are priced.
- A single flat fee
- A transaction fee plus cost for the debit networks.
If a merchant calls in a transaction for telephone or voice authorization. Normally the cost per voice authorization ranges from $0.75 to $1.50.
Batch fee
Settling, or batching is the act of sending a merchant's transactions at the end of the business day to the bank for payment. Batch fees are normally 10 to 35 cents per settlement.
Online merchant reporting fee
Normally reports are free, included with your virtual terminal, but if not some processors charge for online reporting. It can range from 2.50 to $10 per month.
Terminal repair or replacement
A simple warranty program that extends repair or replacement coverage to POS equipment. Around $5 to $10 per month.
Retrieval fees
When a transaction is disputed, a retrieval request is initiated. This fee is typically charged whether or not the chargeback is successful. Normally the cost is $10.
Chargeback fees
Chargebacks can be $15 to $25, per transaction if successful.
ACH reject fee
The same as an overdraft fee on a paper check. Its the fee imposed on a checking account by a bank when a check bounces, normally its around $25.
Annual fee
The amount charged annually for the merchant account. Not normally charged.
Payment gateway
Gateway fees range from $5 to $20 per month. Some gateways do more than process transactions. They can also store customer sensitive data like credit cards, identity verification and more.
Wireless gateway
Some gateways have a wireless option, that fee may be broken out. These fees are normally part of the gateway fees.
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