Ever wanted a list of fees and explanations?

Congratulations! You’ve hit the jackpot of definitions in relation to fees. The fees you will have to pay will end up being different depending on the situation. You may not have to pay all of the fees listed below but at any rate this will be a reference for you to turn to for a basic knowledge on the fees that you are going to pay.

What is the Discount Rate Fee?

The discount rate is paid to the issuing bank over time. This is the most expensive part of processing credit cards. In regards to this fee you should look for the lowest rate out available. Rates are dependant upon average transaction amounts and annual sales volume. The rule of thumb is that the higher these are the lower the rate will be. Estimation of fee amount? 1.5% to 5% Paid to whom? The bank

What is the Minimum Monthly Processing Fee?

The minimum monthly processing fee is also through the bank. With this, if the bank’s1.5% to 5% purchases does not add up to the minimum each month they will charge the minimum no matter what occurs. Estimation of fee amount: $15 to $30 Paid to whom? The bank

What is a Transaction Fee?

A transaction fee is dealing with not only the bank but a gateway as well. Look for least expensive credit cards such as Visa Card and Master Card. But remember to try not to accept credit cards for tiny purchases. FYI: American Express, Discover, Diners, etc usually require higher transaction fees. Estimation of fee amount: 15 to 30 cents per transaction Paid to whom? The bank and/or Gateway

What is an Application Fee?

Heads up! This application fee may be very high and yet there are some banks or brokers who do not charge, so shop around. Estimation of fee amount: none to $500 Paid to whom? The bank or broker

What is a Set-up Fee?

This is where a fee that varies depending on the bank or broker with $30 to $300. Estimation of fee amount: $30 to $300 Paid to whom? Bank or Broker

What is Gateway Hardware or Software Fee?

Many banks or brokers make money with renting out or leasing card swipe terminals, software for PC verification, or real time internet verification system. If you shop around you may be able to purchase these items from the actual source or third parties. It all depends because sometimes the source is the cheapest and sometimes third parties are cheaper. Estimation of fee amount: $350 to $995 Paid to whom? The Bank, broker, or Gateway

What fees are there with supplies?

These fees are sometimes already included into the credit card-swipe rentals Estimation of fee amount: Free or included into card-swipe rental fee Paid to whom? The bank or Gateway

What is an Internet Gateway Setup Fee?

These fees vary, in order to lay hold of real-time credit cards on your web site, you should expect to pay the designer to make up the difference for the extra time to install the gateway. Estimation of fee amount: Varies Paid to whom? Webstore designer or webmaster

What is a Monthly processing Fee?

These fees are paid to your internet gateway. The company can charge you with a monthly fee to process your credit cards added on to a “per transaction fee”. Estimation of fee amount: $40 per month Paid to whom? Internet gateway

What is a Merchant Account?

A merchant account is a type of a bank account setup with a payment processor. When a customers makes a purchase, money is held in the merchant account until the payment is cleared and sometimes longer depending on the credit status of the merchant. When the payment clears, the money is transferred to the merchant's business account.

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