Credit Cards and Merchant Solutions

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    Item Fees

    • Credit card processing companies charge fees for each item that you transact. As of 2011, fees generally range from about 10 cents to about 25 cents per item. Item fees are only one part of your fee structure, which also includes percentage fees on the total dollar value of your transactions, batch fees and annual fees. If you own a business such as a coffee shop that processes a large number of small transactions, it makes sense to choose a fee structure that includes a low fee for each individual item.

    Percentage Fees

    • Percentage fees are the charges that merchant processing companies make relative to the total value of the volume of transactions you process. As of 2011, merchant processing transaction fees generally range between 1 and 5 percent. If you own a business such as a construction company that makes a limited number of sizable transactions, it makes sense to opt for a fee structure with a higher cost per item and a lower overall percentage cost.

    Batches

    • Merchant processing companies also charge fees for each batch of transactions you process. When you charge a customer credit card, the information is stored on your company terminal until you send the group of transactions you have processed to the merchant services company. This process is known as closing the batch, and some merchants do it daily while others do it weekly, depending on how many transactions you process and how soon you need the money to appear in your account.

    Credit Card Processing Equipment

    • In order to process credit card transactions, your business will need to buy or lease a credit card terminal. This terminal should include a printer if you process customer transactions in person, such as at a retail store, so that customers can sign your copy of their receipts. Leases for credit card machines usually cost about $35 per month and come with minimum contracts of three years. A new machine costs about $500 to $800. If you have the capital available, it makes sense to buy a terminal rather than leasing one. Office supply stores often sell used terminals. Check with your merchant services company before buying used equipment to make sure that this equipment is compatible with their system.

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