What Credit Card Processing Is Costing You

The fees associated with credit card processing are different depending on the banks, cards, and merchant vendors, but on average, you can expect about 2.5-3% taken from the total amount. It might not sound like a lot on paper, but in a small business scenario where you need to stretch every dollar as far as possible, this can hurt quite a bit.

Here is who gets paid in any given credit card payment:

  • The Issuing Bank: The banks that provide the paying customer’s credit card
  • The Acquiring Bank: The bank that clears the transaction and deposits the money into the merchant’s account
  • The Card Association: The credit card organization (such as Visa and Mastercard)
  • The Payment Gateway: The merchant system (such as Envision Payments)

The issuing bank is the one that takes the lion’s share of the processing fee, running anywhere between 1-2% of the total payment. The other charges are much smaller. Sometimes they’re flat fees, sometimes they’re percentage rates. But overall, expect to lose up to 3% of the total payment when you process a credit card.

Why ACH (eCheck) Payments Cost You Less

An ACH Payment, in a nutshell, is a special charge that pulls an electronic payment straight out of the buyer’s checking account. It is essentially an electronic version of a check, hence the term eCheck. ACH Payments bypass credit card organizations, allowing you to avoid interchange fees.

eChecks vs. Debit Cards

So, if pulling straight from the bank account is the main way to reduce fees, debit cards are a-okay, right? Wrong! Debit cards are issued by credit card networks, and though they perform a similar function to an eCheck, the bank and the card company will still take a cut. ACH payments allow you and your customers to enjoy the benefits of debit transactions without the added fee from card companies.

Get ACH Payment Functionality With Envision Payments

Want to reduce fees for your small business and provide customer-friendly solutions at the same time? At Envision Payments, we offer an incredible variety of payment systems that are secure and easy to use. We can give you an estimation of how much you could be saving, based on your current fees and revenue. We encourage you to contact us today about setting up ACH payment functionality for your small business.