We Deal with the Technology, So You Don’t Have To

In the world of technology, things move quickly and sometimes that can be overwhelming. PaymentCollect® is here to take away that unneeded stress. That’s why we want you to be able to understand what we can do for you, without getting lost in the complicated details.

How Does PaymentCollect® Save You Money? 

Credit/Debit card payments have multiple components to the amount they charge merchants. One of those components is a common cost (same to all Merchant Service Providers collected by the Credit Card companies such as Visa, Master Card, Amex and the others.) The second is a variable cost, determined by the Merchant Service Providers (MSP) for your account. The last one is on a per merchant basis and is the MSP’s revenue.

Long story short, our relationship with Credit Card companies allows us to cut costs and save you money. Since PaymentCollect® does not have any commissionable agents and our costs are mostly fixed, we can offer merchants a reduced processing cost.

What Will PaymentCollect® Do For You?

You have probably heard us use the term “Integrated Plugins”, but what does this really mean? Integration allows you to manage all your payment processing, vault, and reporting tasks all in one spot! You don’t need to process the payment using an external device or portal and then re-enter it in QuickBooks®, it all happens simultaneously, from the same platform! PaymentCollect® ensures everything happens seamlessly and transparently from within QuickBooks®, making you less prone to making mistakes and gives you more time to put back into your business! 

Integration also comes into play with our Shopify Plugin. With other providers, your QuickBooks® and your Shopify systems are unrelated. With PaymentCollect®, these systems work together to efficiently control inventory. This means that information from both your in-person sales, as well as your online sales will conveniently be analyzed together.

The Difference Between Products

You may be thinking that you need to add electronic payment options to your business, but you’re not sure where to start. That’s okay, we know the terminology can be confusing, so here’s a breakdown! 

With PaymentCollect®, there are three different products that can all help your business – Point of Sale, Desktop, and Online. Each product designed to work with a specific QuickBooks Solution®. There are of course multiple options within each product, such as Taking NFC payments, receiving payments online, shopping cards and more. Contact us to find the right option for you!

Pros and Cons of Electronic Payment Integration

Any type of technology can seem unsettling to new users. That’s why PaymentCollect® and QuickBooks® are here to help you, so you can utilize the functions of electronic payment systems, like POS, Desktop, and Online plugins without feeling weary of downsides. Whether you are an established business looking to make a shift to e-commerce or are a tech savvy entrepreneur looking to get your business off the ground, PaymentCollect® will help you save time and money, as well as help you organize your business. 

Explore the Benefits of Electronic Payment Integration

Geographically Expand Your Business by Using E-Commerce

Services like PaymentCollect® and QuickBooks® allow your company to become global. With the presence of an online store, customers can be reached all over the world! Visit our Shopify page to see how we can help your e-commerce thrive, and attract an additional, online customer base. This is especially important when shopping at traditional brick and mortar stores is not an option, and more consumers are resorting to receiving items from online suppliers. 

Desktop Software Provides Organization that is Lacking in Traditional Systems
One of the top benefits of choosing to integrate digital software into your business is the time you get back in your day. You no longer need to spend your time organizing receipts, juggling 100 open windows on your computer, or doing other time-consuming tasks. With PaymentCollect® and the QuickBooks® Desktop Plugin, financial data is captured and sorted for you. You also increase your productivity and workflow because QuickBooks® introduces streamlined invoicing and other accounting tasks. Adding PaymentCollect® to the mix allows you to run versions of QuickBooks® without expensive updates, as well as operate everything from one, easy to use window.  

Providing Good Customer Service and Improving Public Satisfaction with your Company


Stores that already have an e-commerce presence, know that cashless transactions are becoming ever more popular. When we are able to physically be in stores again, some of your consumers will still want a cashless transaction, especially during a global pandemic. In fact, some people will even avoid shopping at places that only accept cash. By purchasing the PaymentCollect® POS system, you can provide the contactless and cashless transactions your customers are looking for. 

Whether it be for safety, or convenience, your customers want to shop easily, with one click or a tap. By using PaymentCollect® and QuickBooks® across all platforms including your online store, as well as in-person POS systems, shopping at your business is seamless. PaymentCollect® offers faster credit card processing than our competitors, so you can give your customer the best experience possible. 

What are the Downsides of Electronic Payment Integration?

Now that we have talked about the benefits your company can receive, we want to address the potential downsides of electronic payment integration. The pros list certainly overpowers the cons, however we are aware of the common worries, and will work tirelessly to provide solutions. 

With so many softwares emerging, it can be hard to choose the right one. Small business owners do not want to be hounded by Merchant Service Providers soliciting their business on a daily basis with empty promises of lower fees, transparency, and the best in-class integration software. With other electronic payment options, the service providers are working in their best interest, not yours. However, with PaymentCollect®, our lower price does not come with hidden fees and there are no undisclosed price increases. 

Another potential downside is that the technology of electronic payments could be overwhelming when getting accustomed to them. The best thing about our service is that it has the opposite effect. Using PaymentCollect® will actually make your QuickBooks® easier to use. We do not introduce new windows, and we allow the capability for software data to feed into each other without manual information transfer. We mirror QuickBooks® functionality as closely as it gets. This lowers the learning curve for merchants and their staff.

Lastly, business owners may be reluctant to make the switch because of the costs associated. However, PaymentCollect® allows you to operate on any older version of QuickBooks®, so you do not need to invest in pricey updates, which will save you money. With PaymentCollect® you will also save money due to the elimination of hidden fees from credit card companies.

We want to make it easy for you to choose PaymentCollect®, so our support team is happy to assist you with any questions or concerns you may have. 

Contact us today to capitalize on the use of e-commerce and electronic payment systems. 

Electric Payments Merchant Spotlight – Integrate your Shopify Store

E-commerce services like Shopify and QuickBooks® allow for businesses to reach a larger audience which is especially important when walk in traffic is limited. When you choose PaymentCollect® to help these services work together, growing your online presence is easy. 

QuickBooks® and Shopify Assets and Financial Data all in One Place
PaymentCollect® allows you to multitask, without even realizing it. When you own a business that operates with e-commerce, there are a variety of responsibilities, from credit card processing to invoicing and more. Data and information seems to be flying around, and could get overwhelming. Luckily, PaymentCollect® is a software plugin that integrates with multiple processors and hardware, that will pull data from all platforms, and organize it all in one place! The work of manually sorting and adapting your data to Shopify is no longer needed! Imagine what you could do for your business with that extra time on your hands?


Inventory Synchronization Improves your Customer Service
In a time when customers can receive things lightning quick, inventory turnover can be an important factor in sales. With PaymentCollect® it is easy and convenient to keep track of your inventory, so you can avoid costly out-of-stock supply chain errors.


Our Goal is to Make Ecommerce as Easy as Possible for You
We all need some support when things get overwhelming. By helping you integrate and unify all of your QuickBooks® and Shopify plugins, PaymentCollect® allows you to manage your electronic payment systems with confidence. All of these platforms may do different things for your business, but PaymentCollect® allows them to communicate seamlessly with each other. 

The best part is that there is no need to upgrade to QuickBooks® POS v.19 to leverage e-commerce; we integrate with all versions back to 2010!


Process all payment methods, organize receipts and invoices, manage QuickBooks® online payroll, use Shopify in the most beneficial way, and explore more features that will make your life better. Collect on that with PaymentCollect®.


Streamlined Invoicing and Tasks to Help Your Small Business

If you are a small business owner, we know you work hard around the clock to ensure your business is running smoothly. Aspects such as online payroll and managing electronic payments should not have to add to your stress or affect your customer service. With PaymentCollect® and QuickBooks®, administration tasks are easy and seamless so you can focus on the art of your business

Save Time when we Work Together

By working with PaymentCollect®, there are a variety of features that will save you time and money as a small business owner. For starters, QuickBooks® Online Integrated Plugins allow payments to be triggered from within QuickBooks®. Information is posted back all in real-time, making it easy to save time and reduce mistakes. PaymentCollect® will then organize and sort receipts so you have everything in one place! Choose between batch or single invoicing to help you manage your electronic payments. You can even safely store credit card information for the next invoice!

Avoiding Cons of Electronic Payment Systems by Protecting You and Your Customers

In an age where digital technology is growing so quickly, it is normal to be concerned about security. At PaymentCollect®, we put your personal needs first. Our Privacy Policy ensures that our credit card processing is done securely and safely, so information stays private. PaymentCollect® can also help you reduce fraud by implementing an out-of-scope payment terminal.

PaymentCollect® is Here for You With Around the Clock Customer Service

Nobody can be expected to be knowledgeable about everything, that’s why we always have answers for you, in real time. If you have any questions about processing payments, we are here to help. 

Visit our support page to send a question, pick up the phone, or view our frequently asked questions. Our talented representatives are happy to guide you. PaymentCollect® offers support software downloads, to ensure we don’t take up too much of your precious time. 

PaymentCollect® and QuickBooks® make it easy for you to focus on the things that matter to your business.


It’s Easy to Choose PaymentCollect® as your Electronic Payment System

Are you Tired of QuickBooks® Unnecessary Software Updates? 

Merchants commonly use the QuickBooks® enterprise because it’s familiar, relatively inexpensive and popular. We love QuickBooks® Plugins, however, what we do not love is the constant upgrades required in order to keep using Intuit Merchant Services. PaymentCollect® wants you to continue using QuickBooks®, while also using our software to cut down on upgrade time and costs. 

With PaymentCollect®, you will keep the merchant services account, and your QuickBooks® Plugins. We are simply here to help you run QuickBooks® without any upgrades, provide you immediate customer support, and become the “brains” behind your transactions.
With our program, not only are there no hidden fees, but you will SAVE on your current fee spending, which makes PaymentCollect® the perfect software to run along-side QuickBooks®.

Nothing Changes for You, Except for the Good Things 

You may be wondering about the transfer of information or other start-up inconveniences, but the best thing about the PaymentCollect® structure is that it is fully integrated into your QuickBooks®. With easy-to-use software and no extensive training needed, we can immediately start helping you be more efficient. 

Your customer’s payments are captured in QuickBooks® in real-time, so you do not have to worry about a thing.

Save Time When We Work Together 

PaymentCollect® helps you manage your e-commerce and in-store POS payment systems by introducing streamlined invoicing to your QuickBooks®. Accepting all methods of payment such as credit card, debit card, and gift card, our software will organize your receipts in a way that is convenient for you. 

Fully integrated means that our tool hub allows QuickBooks® to enable transactions, generate reports, troubleshoot issues and minimize input errors, all while you get to focus on your business.

What do you need to get up and running with PaymentCollect®?

We want to make it as easy as possible for you to choose PaymentCollect®, so we have created this quick checklist of things you will need;

  • Windows computer with enough storage 
  • Your preferred QuickBooks® software installed
  • Strong internet access

That’s all! There is no reason to wait any longer to get the results and efficiency you have been looking for.

If you are ready to save 25 – 50% on your current processing fees, do more with your time, and provide great customer service, then make the quick and easy decision to use PaymentCollect®.

Get up and Running with PaymentCollect ® and QuickBooks® in 2021

QuickBooks® Desktop 2021:What to Expect?

Organization and efficiency are effortless with QuickBooks® Desktop Plugins. QuickBooks® makes it painless for businesses, freelancers, and accountants to process their electronic payments with ease! Whether you are getting paid, or paying others, you can do it all from your Desktop. With QuickBooks® Pro, you can do less data entry (who doesn’t love that) and organize receipts in a way you will love. Get the desktop accounting software 94% of users would recommend to a friend *(quickbooks.inuit.com)

Accounting no longer has to be dreaded, with QuickBooks® Desktop, you can manage all of your accounting and electronic payments in one user-friendly place. 

Take your QuickBooks® Anywhere you go with Online Integrated Plugins

Use QuickBooks® on any of your devices to make workflow faster and more efficient so you can save time. There is even a mobile app so managing your payments is more convenient than ever. With QuickBooks® Online Payroll, you can take the pain out of administration payroll tasks. You don’t have to worry about slow processing times and tedious work because QuickBooks® allows for batch invoicing. 

With online payment processing your business can save on Inuit merchant services and accept any and all payment methods such as Credit Card, Debit Card, and Gift Cards. Payments are triggered from within QuickBooks® and information is posted back. All in real time! Online integrated plugins support all QuickBooks® functionality including sales receipts, invoicing and receiving payments. For all of your needs, QuickBooks® Online has you covered.

Helping Merchants with their In-Store Transactions

Fingers crossed that things will be getting back to normal, and when they do PaymentCollect ® and QuickBooks® will help you with your in-store transactions! Your business will have access to Level II Payment Processing (through the use of EMV terminals) — QuickBooks® POS plugins allows for real-time payment processing and inputs the data into your QuickBooks® account while automatically creating and categorizing receipts. 

There is a reason businesses are changing their operations from cash registers to Point of Sale terminals, and QuickBooks® is the best you can get. By using QuickBooks® POS integrated plugins, your customer service will be more than satisfying. We bring the technology, and you bring a smile to greet your customer with.

Choose PaymentCollect ® and Operate your QuickBooks® to the Best Capacity

Some may ask where our services come in, well PaymentCollect® increases your QuickBooks® functionality, and seamlessly ensures all of your information is protected and connected. By using PaymentCollect® services, your business is able to operate on your current QuickBooks® software, without paying for expensive upgrades! Our goal is to save you time and money, so you can focus on the things that matter. 

The access to human connection is another reason to choose PaymentCollect ®. Our customer service is reliable and always provides you with a real person to talk to. If you have questions about any transactions or payments, we are here for you.

What Does E-commerce Look Like in 2021?

Electronic Payment Systems: Moving Beyond Cash, Checks

Through 2020, the world has seen an increase in consumers turning to e-commerce and electronic payment methods. Did you know that Forbes magazine says there has been a 149% increase in US and Canadian online retailers since April 21st, 2020? Along with that, shopping at small and medium-sized businesses are becoming more popular. With the online payment methods that PaymentCollect ® supports, local businesses have the ability to successfully explore a digital space. With a new year upon us, e-payments will further advance and change to the current situation. Here are the upcoming predicted e-commerce trends for 2021, and how PaymentCollect ® and QuickBooks® Plugins can help your business stay current and efficient. 

Creating a Personalized E-commerce Experience 

Users have moved away from generic experiences, and everything is beginning to be more customized and personal. This includes the experience consumers are looking for when using online customer service. Personalization can include product recommendations, human interactions, and helping customers achieve their goals. With fully integrated online plugins, PaymentCollect ® and QuickBooks® can assist in providing the personalization you are searching for. With our POS Payment Processing, information reaches the user quickly, in real-time, making their experience specific to them. Also, by using PaymentCollect ®, your QuickBooks® receipts are organized to your preferences. If you have questions regarding ways to incorporate your business’s unique needs into your current QuickBooks® online systems, please contact us!

Providing the Best Electronic Payment Environment for the Customer

Over 50 million users are relying on electronic payment systems such as Intuit QuickBooks® to operate their businesses comfortably. With e-payments being such a large part of people’s lives, it is important for customers and business owners to feel safe. In 2021, security is everything, from your smartphone to your online purchases. PaymentCollect ® allows you to feel confident that essential information remains private during credit card processing and other online payment activity.

Advanced Speed and Workflow

According to Shopify, 10 years of e-commerce growth happened in just 90 days. As more users are seeking digital options to retail, the competition in the online space is growing. More brands are introducing online stores, which means consumers will have more providers to choose from. In order to make your business stand out, your software must be simple, and efficient in order to maintain the consumer’s attention. By choosing PaymentCollect ® you will have access to the new features in QuickBooks® Online Advanced Speed Workflow, including streamlined invoicing without upgrading your current system. QuickBooks® Desktop 2021 also offers more options to save time and boost productivity. We are always thinking about user solutions as we design our software, so you can focus on building brand loyalty from your beloved customers.

Choose PaymentCollect ®

Allow PaymentCollect ® to guide your business through 2021. We will be a partnership that is consistent, efficient, and will always keep your brand at the top of our priority list. You can feel confident that we are constantly studying the e-commerce trends, and will work hard to ensure your current systems are able to manage all of your electronic payments.

How Credit Card Processing Works

Important Information About Credit Card Processing for Business Owners

Although the entire transaction only takes seconds to complete, the credit card processing system is a complex process that takes multiple parties and steps to complete. The bankcard networks handle billions of transactions between merchants, processors, and banks around the world. And these bankcard networks must be as secure as possible to prevent credit card fraud. Learn more about the parties needed in order for a transaction to be completed, as well as the steps of the credit card processing system.

Parties Involved in Credit Card Processing

To understand credit card processing, you first must understand the players involved. They include:

Cardholder

These are your customers. Cardholders are people who obtain a credit or debit card from an issuing bank and use it as a payment method.

Merchant

Merchants are any businesses that sell goods or services. If you are a small business owner, you are the merchant. A merchant account is needed for your business to accept credit or debit cards from cardholders.

Card Associations

More commonly known as Visa and MasterCard, card associations are responsible for working with credit card processors to transfer data between the issuing bank and the merchant. They also are in charge of setting the interchange and assessment fees, although they do not collect all of them. For example, the interchange fees are passed onto the issuing bank.

Card associations, or networks, don’t actually issue credit cards or merchant accounts. They function as the governing body of a community of financial institutions, ISOs and MSPs that work together in association to support credit card processing and electronic payments.

Acquiring Bank

Think of the acquiring bank as the merchant’s bank, as they contract with merchants to create merchant accounts. An acquiring bank is a registered member of the card associations (for example: Visa and MasterCard). They are the ones who provide equipment and software to merchants so they are able to accept cards and other necessary aspects involved in card acceptance. The acquiring bank is also responsible for depositing funds from these sales into a merchant’s account.

Some merchants don’t see their acquiring bank as the primary provider of their merchant account. This is because acquiring banks play more of a hands-off role and enlist the help of third-party independent sales organizations (ISO) and membership service providers (MSP) to conduct and monitor the day-to-day activities of their merchant accounts.

Issuing Bank

An issuing bank is the consumer’s bank; they are responsible for issuing credit cards to consumers. Like an acquiring bank, an issuing bank is also a member of the card associations. An issuing bank pays the acquiring bank for any purchases the cardholders make. Cardholders are then responsible to repay the issuing bank under the terms of their agreement.

Credit Card Processing Steps

Now that you know who’s involved, it will be easier to understand how the process works. While you don’t necessarily need to understand the inner-workings of the bankcard system, knowing how it works can potentially help you save on credit card processing fees. The steps are as follows:

1. The Consumer Makes the Purchase

In order for the process to begin, a consumer must purchase a good or service from the merchant using a credit card. This can be done in person, online, by phone, or by mail.

2. The Transaction is Entered

The consumer will either swipe or enter their card or insert it into the payment processor. For online purchases, the consumer will manually enter their credit card information.

3. The Processor Collects Data

The payment processor collects the consumer’s credit card information, as it is responsible for routing that data across to other stages and facilitating communications between the parties. Their first role is to send the payment information to the card network.

4. The Card is Approved or Denied

After the data has been received, the credit card issuer will either approve or decline the transaction. Common reasons for cards to get declined are the card is no longer valid or the consumer does not have enough funds available. Additional security measures may be taken to verify whether the purchase is legitimate or not.

5. The Transaction is Completed

If the transaction is approved, the processor and merchant receive an authorization response. The merchant then goes ahead and completes the transaction. But just because the transaction is complete does not mean that the funds are released yet. This is a separate process that takes several days to complete, depending on the card networks involved.

6. The Merchant Submits a Batch Closure

In order for the merchant to receive the money, it must first complete a batch closure at the end of the day. This will close out all of the transactions that have been processed on that day. This allows the processor’s acquiring bank to collect the money from the credit card issuers.

7. The Funds are Deposited to the Merchant

Once the funds have been collected, the acquiring bank then deposits the money into the merchant’s bank account.

Now that you know how the process works, be sure to visit our blog to learn how to determine your credit card processing fees!

EMV Compliance Explained

While EMV compliance has been around for quite some time, there still tends to be a lot of confusion around the subject. What is EMV compliance, and how can you as a merchant ensure your business is EMV complaint? Find all of your answers below!

What is EMV Compliance?

Have you ever wondered what caused the switch to go from sliding your credit card to inserting it into the terminal? The EMV, short for Europay, MasterCard, and Visa, is behind that. They are the three companies who established the computer chip technology to help combat against credit card fraud. In addition to the traditional magnetic stripe, EMV credit cards now also feature smart chips and are seen as the new industry standard around the world.

Why are EMV Cards More Secure than Traditional Cards?

Cards that only have a magnetic stripe are at a higher risk for fraud because the stripe contains unchanging data. If someone copies the stripe, he or she can easily replicate the data because it doesn’t ever change.

However, when a credit card with an EMV chip is used to make a payment, the chip creates a unique transaction code that cannot be used again. So even if a hacker was able to steal the chip’s information from one specific sale, card duplication will not work because the stolen transaction number expires after one purchase. The card would ultimately get denied. It’s important to note that while this technology makes it more difficult for criminals, it will not completely prevent data breaches from occurring.

The Importance of EMV Compliance for Small Business Owners

EMV compliance rules officially went into effect in October 2015, but they are not a legal matter. So while you cannot be arrested for non-compliance, there are some costly risks associated with not following the rules. If your business is still processing credit cards with the magnetic stripe, it will be held automatically responsible for any fraudulent charges made with a chip card.

For example, if a customer comes in and completes a $500 transaction with a chip card and you use the card’s magnetic stripe to ring them up, that customer can potentially dispute the change. And because you are a non-compliant merchant, you would have no legal recourse.

EMV compliance protects your small business from liability. It doesn’t matter if some of your customers are still using cards that only have a magnetic stripe, as long as you are EMV compliant, you will not be liable. This includes both chip transactions and swipe transactions.

How to Become EMV Complaint

So what does this new technology mean for your business? The first step is to upgrade your POS systems to ensure compliance. The new terminals feature the option to insert the card at the bottom, while still offering the swipe feature for customers who do not have EMV credit cards.

The next step is to look into the EMV Value Added Reseller Qualification Program. This is a certification that was developed by the PCI Security Standards Council and the Payments Security Task Force for VARs. During this process, an EMV terminal and toolkit are used. Special test scripts will be executed with the help from the EMV toolkit. The results are submitted to the acquirer who then forwards the results to the associations for final approval.

EMV certification typically includes an administrative fee that ranges between $2,000 and $3,000 for every formal test script run. Re-certification is required every time a new hardware device, using a different EMV kernel is added to the previously certified EMV-processing pad. For example, if you have a specific type of device that has been previously certified, any other device of that kind is automatically covered. But if you use a different type of device, your business will need to initiate another EMV certification, even if you are utilizing the existing host integration and back end.

Challenges to Becoming EMV Compliant

One of the main reasons why businesses have yet to become EMV compliant is how much it costs, especially for retail or other businesses with multiple locations. But what many of these business owners do not understand is that the liability switch leaves them at a higher risk for having to pay fraudulent charges.

Another challenge is getting the appropriate certifications in a timely fashion. Many software providers underestimated the complexity and time of getting certifications completed. This means that even if merchants have their new terminals setup and ready to go, if they are waiting to be certified, they can be held accountable for any fraud that occurs with chip cards.

Benefits of Being a EMV Compliant Business

The biggest payoff is fraud reduction. While the level of success is suggestive, MasterCard has reported that fraud has decreased by 60%, in terms of dollars among its top five EMV-compliant merchants. Reducing the risk of fraud helps your business save money on credit card processing fees. But saving money isn’t the only benefit.

New EMV-compliant terminals offer add-ons that customers are starting to become more accustomed to, like Apple Pay and Android Pay. While it is unlikely for any other form of payment will surpass cards anytime soon, the payments mix is becoming more complicated. With more users looking for alternative payment options, being EMV compliant provides a better customer experience. In addition, the new technology makes it easier to integrate systems into legacy POS.

Moving Forward

If your business hasn’t upgraded to EMV technology yet, it is strongly advised you do so. While these upgrades can be expensive, merchants risk facing a much greater cost if they get stuck with bills for credit card fraud.

EMV compliance has helped significantly reduce card-present fraud. But it does not protect consumers from all data breaches. Liability for fraud on a non-chip card remains with the banks. In addition, card-not-present fraud (online or phone purchases) is on the rise. Regardless of what new challenges may be on the horizon, it’s important to make the switch to EMV technology. This worldwide standard is shaping the future of payment processing, and we will continue to see development of contactless technologies to help reduce fraudulent activity.

How to Determine Your Average Credit Card Processing Fees

Business owners have been relying on traditional merchant accounts to process credit and debit card transactions for years. But with the industry expanding and evolving more rapidly over the past few years, including the introduction of the industry has expanded and evolved over the years, it’s even more important to know the processing fees your business is being charged.

As a business owner, you may be wondering, “what’s the average credit card processing charge for my type of business?” There is not one simple answer. Many different variables impact the fees a merchant pays. The more you know, the more likely you are to save on your credit card processing fees. Below you will find our guide to calculate your credit card processing cost.

The Average Credit Card Processing Cost

If you’re looking for the short answer: the average credit card processing cost for a business where cards are swiped is typically 2.3%-2.4%. For ecommerce and other card-not-present businesses, the average cost is usually between 2.3%-2.5%. Of course, these costs can fluctuate depending on a variety of factors.

While these numbers can give you an idea, it’s best to fully understand what goes into credit card processing costs so you can come up with a more personalized estimate. Underestimating your fees can hurt your new businesses when it is most vulnerable.

What is an Effective Rate and How Does it Help with Payment Processing?

An effective rate is the amount that your business pays in processing fees relative to your gross volume. It is especially useful when you are looking to determine your average processing expenses.

How to Calculate an Accurate Effective Rate

There are a few different factors that go into determining your business’ effective rate. They include:

1. Processing Method

Your processing method affects how many and which types of fees apply. A business can process a credit card in two ways: card-present and card-not-present.

As the names imply, card-present refers to a business that physically swipes cards, while card-not-present refers to e-commerce and other businesses that process transactions remotely. Your processing method affects your interchange fees, processing markup, along with other third-party charges. Card-Present businesses have better cost benefits compared to card-not-present businesses, including:

Card-Present Business

  • Lower interchange fees (roughly 1.60% plus $0.10 transaction fee)
  • Lower monthly fees (around $5-$15) and transaction fees ($0.08-$0.10)
  • Low risk and lower interchange plus rates
  • Lower occurrences of chargebacks and fraud

Card-Not-Present Business:

  • Higher interchange fees (roughly 1.90% plus $0.10 transaction fee)
  • Higher software costs associated with online gateways (generally $10-$15/month plus a $0.01-$0.08 transaction fee)
  • Higher risk and higher interchange plus markups from processors
  • Higher occurrences of chargebacks and fraud

 

2.    Average Ticket Size

Ticket size refers to the amount of a typical credit/debit sale. It has a large impact on your business’ processing fees. The greater your average ticket size, the more expensive your average processing costs will be. On the other hand, as the ticket size decreases, the number of transaction fees incurred increases. Because transaction fees have a larger impact on smaller transactions, they have a greater impact on overall cost. One way to save on processing fees is to set a minimum for credit cards. This will help decrease the number of smaller transactions.

How to Calculate Average Ticket Size for Determining Average Processing Fees

Divide your business’ expected/actual monthly processing volume by its average ticket. Then, multiply by the total transaction fee (roughly $0.18-$0.20 for card-present businesses, $0.25-$0.30 for card-not-present businesses). Divide by the processing volume before multiplying by 100. Your result will be the percentage of total volume that goes towards paying transaction fees.

How to Calculate Average Credit Card Processing Costs

  1. Calculate your average monthly processing volume and average ticket amount. As an example, we will use $10,000 and $50.
  2. Find the average interchange cost for your processing method (1.60% for card-present and 1.90% for card-not-present). We’ll be using card-not-present for our example.
  3. Add the processor’s interchange markup to the average interchange cost. For this example, we use 0.25% as the markup. Adding it to 1.90%, the total now is 2.15%.
  4. Next, determine the impact your average ticket will have on transaction fees by following the steps in the “How to Calculate Average Ticket Size” section, and add that number to your running total. In our example, we’re using the $0.25 transaction fee. Here’s how it works out:

$10,000 / $50 * $0.25 = $50
$50 / $10,000 * 100 = 0.50%
0. 50% + 2.15% = 2.65%

  1. Finally, figure the impact monthly fees will have by using the average monthly charges from the “Processing Method” section and the formula for determining average ticket impact. As a card-not-present business, we used monthly fees of $15:

$15 / $10,000 * 100 = 0.15%
0.15% + 2.65% = 2.80%

For our example, an online business that processes $10,000 a month with an average ticket of $50 will pay about 2.80% of volume or $280/month in credit card processing charges.