Every month I calculate my effective merchant fee rate by dividing all my fees into card purchases from my monthly statement (so including taxes, tips, etc). I pay no more than 2% all up every month (March was 1. 985%). Here's how: I joined our state's restaurant association which has a member discount with a major processor (US Bank). Membership costs me about $400/yr but I save over 0. 5%, which is over $5k/year. Easy math. I taught our staff to avoid manually entering card numbers as much as possible. Before we took over if a card didn't work after 2 swipes they would just key it in. That drastically increases your fee. Now it's rare to have any manually entered cards (even for phone orders we encourage people to not pay over the phone if possible). In house if a card doesn't swipe we often ask for a different card (usually they apologize to us "yeah, sorry, that card is super old"). When entering cards by hand be sure to include the CVC code (not just number and expiration)! I completed a PCI self assessment to avoid non-compliance fees of $60/month.
Why don't credit cards penalize, then forgive too?
They're going to respond for sure with threats of not offering things like the bonus travel reward points or interest free introductory period and waiving annual fees. And I say good! These are all reflections of how much money they are making in the first place. And by the way, they make money off high interest rates, annual fees and transfer fees, but the big source of income is that 2. 9% of every transaction they collect from the seller. As our economy moves towards credit cards for more and more things, imagine credit card companies pocketing that much on every transaction. It's just a bit less than the government's collect in sales tax. Holy shit they take a lot of our money.
It's a Pita but worth it. My rate includes online orders from our website (which have higher rates). If we just did indoors I think I'd be closer to 1. 75%. I refused to be locked into my POS merchant processor, so I do pay a monthly fee of $40/month but to save over 0. 5% on my rate is totally worth it.
I wanted to share a personal story that has helped me save 1000's a month and I think it can help you too. Back in September, I reached out to my rep for my POS. I told her look I'm unhappy with the service you are providing and I'm unhappy with the rates. For some background, I have a long term contract which would have required 1000's to get out of. I told my rep I was unhappy enough to switch and eat the costs. I said: "look I'm one of the few restaurants who is surviving this pandemic, further, I'm putting up very high numbers (luckily). I want to be treated like a premium customer with premium customer rates because I am a premium customer. If you can't do that, someone else can" Within a month, they got back to me and halved my rates. I actually just had an independent audit of my rates and they told me I'm paying the lowest they've ever seen. Currently, you have a ton of leverage. The POS companies lost half their customer base. They need restaurants to survive. You won't have another chance to lower your rates like this.
Balance Transfer Up to 18% p. of the amount transferred, calculated on a daily basis for a fixed duration. Fees Cash Advance: The Cash Advance fee is 5% of the amount advanced or a minimum of RM15, whichever is higher. This is incurred for each cash advance transaction. Replacement card: RM50 per card Late payment: minimum of RM10 or 1% of the outstanding balance, whichever is higher, capped to a maximum of RM100 Overlimit: not applicable Sales draft retrieval request: RM20 per card Minimum monthly repayment 5% of the outstanding balance or a minimum of RM50, whichever is higher. Interest free period 20-day interest-free period is only enjoyed on all retail transactions, provided all outstanding balances as per the monthly statement of the previous month are fully settled. Conversion for overseas transactions If the Cardholder uses the Credit Card for transactions in a currency other than Ringgit Malaysia, such amount shall be converted at the exchange rate as determined by Visa International or MasterCard International, as the case may be, on the date of conversion in addition to a foreign currency conversion cost of 1.
Don't go through anyone here because they refer and get kickbacks. Source I work for a direct processor. level 1 My company charges,. 05 percent over interchange for Visa, MC, Disc.. 30 percent Amex. Let me know if you want to know more, but you aren't going to find something lesser than that. If you do, it won't be much.
It means on a $100 transaction, you will pay 2. 9% in credit card processing and $0. 30 for the transaction. Math: $100 online transaction. x 2. 9% = $2. 90 + $0. 30 Total transaction fees: $3. 20 for credit card processing. This gives you net (deposited into your account) of $96. 80. You pay slightly different rates for AMEX cards than for Visa, Amex, etc. Hope this helps.
"Late on Friday, Scotiabank said it would reduce credit card interest rates to 10. 99 per cent for personal and small business clients who have been approved for, or seek, payment deferrals. Earlier, in separate statements, TD Bank said it will cut credit card interest rates by 50 per cent for customers experiencing hardship, and Royal Bank said it will reduce the charges by the same extent for clients receiving minimum payment deferrals. National Bank will allow credit card customers to defer minimum payments for up to 90 days and reduce annual interest rates to 10. 9 per cent for these clients, it said. CIBC too will reduce interest rates to 10. 99 per cent on personal credit cards for users who request to skip a payment, Canada's fifth-largest lender said. "
The Star had an article on this already and here are my thoughts: If your credit card interest rates are what's crushing you right now then you have no business complaining. People keep their 20% interest rate cards for the "rewards" but carry over balances. One month of $10, 000 is going to cost you $200 in interest.... a month. That kind of negates and "rewards" that you get from that card. Every bank has a low interest card that will be around 10% or prime+X%. I had $15, 000 in credit card debt (among other debts, which I've since lowered by $40, 000). I moved $10, 000 of my debt to a line of credit at 7% and set up a low interest rate card for the remainder at prime+5%. Yes, I forfeited my "exclusive" RBC avion card but the rewards I recieved from it weren't equal to the interest I was paying. The government has no skin in this game. Anyone carrying over a large credit card balance at 20% doesn't need a government bail out, they need a slap in the face. Call your bank now and say, "I need to a line of credit to cover this or a low interest rate card, yes I realize I won't have rewards, yes I still want to do it, thank you".
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