Saturday, April 13, 2013

Interchange Reimbursement Fees

As you may, or may not be aware, each year, typically in April and then again in October, Visa and MasterCard make adjustments to their Interchange Reimbursement fees. If you accept payment for your goods or services, in your business, I assume you understand what "interchange" is. If, however, you don't, then it's time that you find out because they have a direct impact on your bottom-line.

This is especially the time of year for you to pay very close attention to your merchant statements. Typically, there is a section of "notifications" or "messages" that are used to inform you of things relative to your merchant account. I would suggest that you go back and grab maybe your February and certainly your March 2013 statements to see if there are any "alerts" of impending rate increases or fee changes, coming your way. See if there is any mention of rate hikes and make certain you get full of understanding of why and how they will affect your pricing.

You see, when Visa and MasterCard adjust their rates (and when I say "adjust" I mean upwards... of course), those increased costs are passed on to your processor. Then, they have to decide what to do about them: absorb the increases, pass on some of the increases, pass on all of the increases or pass on all of the increases PLUS SOME, to further help their bottom-line and hurt yours. If you're not fully aware of how you are currently priced and how, and if, any or all of the increases are being applied to you, you could be unknowingly paying to much.

If you have an interest in doing so, search for "Visa USA Interchange Reimbursement Fees" and then "MasterCard Interchange Rates". You will be taken to the respective sites where you can begin looking at current rates (understanding them is a whole other issue). If you go right away, they may not have the most current, April 2013, rates posted yet. However, that's a good thing because if you can pull, the October 2012 or even April 2012 rates, you'll have a point of comparison with new rates. While you're on each of these sites, spend some time and browse around. You'll find some helpful educational material relative to industry news and new developments that could be of benefit.

While I'm on the subject of "spring happenings", let me also caution you, or maybe just remind you, that spring typically brings on a surge of "newbie" credit card processing reps. These individuals, unfortunately, hit the streets ill-equipped to really be of any great benefit to you. They get some brief "product/service" type training and very little, if any, industry training. Then they are sent out to pound the pavement and "pitch" their offer. Many may sound enticing enough to get you to make the switch only to find out later on that you are paying higher overall rates or undisclosed fees. Simply, you absolutely need to make sure you are armed with thorough knowledge of this crucial service that you are paying for in your business. Low interest MasterCard interchange.

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