29 Jan Card fees, charges and contracts: What to look into (and out for)
As a business owner, you deserve peace of mind when it comes to card payment fees. When receiving your monthly bill there should be no unexpected charges and additional fees from your payment services provider.
That’s why we stick to a no hidden fees approach, offering fair and transparent pricing to our customers.
Being aware of what charges are included in your monthly statement and payment acceptance contract is key in figuring out the true cost of your overall bill.
Here are the main card payment related charges you need to know about, including some charges that might be overlooked unless called out.
Standard card payment fees and charges
Merchant Service Charge(MSC)
Merchants generally pay a Merchant Service Charge (MSC) for each transaction. The MSC includes:
A percentage of the fee is charged by the card issuer (generally the bank that issued the card) to cover handling costs.
Card scheme fees:
These are fees paid to card payment systems like Visa and Mastercard. These may vary depending on the type of card used (i.e. debit, credit, business) and type of transaction (i.e. non-secure transactions, like over the phone payments where the terminal’s Chip & PIN and contactless security features aren’t used, can be higher)
These are fees charged by the acquirer to cover their costs and profit margin.
Instead of MSC rates, set percentage rates offer one set price per transaction regardless of card type and card issuer. With no ability to adjust your rates, as your business takes more card transactions or when completing transactions, your fees can become more expensive.
Ready made plans
Similar to set fees, but with more flexibility for merchants growing their business, are ready made bundles. Merchants can choose the payment package that best suits their needs and these rates can be adjusted (up or down) where necessary.
Blended Tailor made rates
If your business has a monthly card turnover greater than €8,000, or if you have specific needs that aren’t matched by our ready made packages, consider blended rates.
Our tailor made blended rates deliver simple and predictable pricing with:
- Agreed individual prices for all the relevant card and transaction types
- PCI compliant, modern terminal/s, specifically suited to your business needs, installed by a BOIPA technician.
- Automatic processing of settled funds into your bank account the next working day.
Refunds and chargebacks
A refund fee is applied each time you attempt to process a refund back from the card terminal.
A chargeback is the return of money from a card transaction back to the cardholder. Some of the reasons a cardholder might initiate a chargeback include:
- They believe a transaction is fraudulent
- The cardholder does not recognise the transaction on their account
- A customer feels that they have been misled by the merchant.
You can find out more about how to prevent them here (need to update with changes in google doc)
Chargeback fees can be quite high with some providers, so it’s important to check for chargeback fees in your contract.
The cost for renting your card terminal from the merchant services provider.
BOIPA’s no hidden fees approach
Our transparent pricing model means our customers know exactly what they are being charged for and understand the true cost of their payment acceptance agreement with us. With other providers you may have to stump up for additional charges.
Additional charges you could be charged for by others providers
Authentication (Auth) / secure transaction fees
An authorization or secure transaction fee is charged each time a business authorizes an attempted card transaction. This could be anything from 3 to 5 cent per attempted transaction and this can stack up over a month.
Installation and onboarding
Our team of field engineers are available across the country to get you set up and provide support if you need it. To compliment that, our Irish based customer support desk is readily available to answer any of your questions.
Others may charge for initial terminal configuration and ongoing maintenance.
Minimal monthly and next day settlement charge
There could be a charge even if you don’t need to use your terminal often or at all within a monthly period.
Having your settled funds land in your bank the next working day is a major benefit for merchants accepting card payments. However, check to see if there is a charge associated with this service.
Change of legal entity charge
It’s common for many Irish businesses starting out to register as sole traders or as a partnership. As a business grows, they may be advised that a limited company structure is more appropriate. This would mean amending your payment acceptance contract, which could incur an unexpected fee depending on who your payment providers are.
The PCI compliance fee is the monthly/yearly cost that payment processors charge to assist with maintaining compliance.
A charge associated with maintaining your account with a payments provider.
And there could be penalty payments too….
PCI non-compliance fees
If you haven’t certified your compliance for PCI, you may be on the hook for a monthly fine.
If your monthly bill fails to be processed on time, there could be a fine for the failed direct debit and a charge for the administration costs associated with arrears.
Terminal replacement charge
Accidents can happen in busy workplace environments. Speak with the payments provider regarding what happens if your terminal is accidentally damaged as some can charge upwards of €400 to replace your terminal.
Rolling contracts can bounce up your fees
Rolling contracts, or short term contracts that transition into rolling contracts, can seem attractive to merchants as it allows businesses to move from a payments provider with minimal notice and without penalty.
However, these agreements come with financial risks as a payment services provider may increase your fees without notice or clear communication. Read the fine print in the contract and query this before signing up for a payment solution.
Talk with us about card payment fees
If you are thinking about moving or switching back to us, we’re only a phone call away.
Along with a responsive Irish based support centre, our pricing and contract terms are transparent, clearly defined and come with no nasty surprises.