Have you ever had your totals different from those that you had been expecting? Have you noticed a sudden hidden rate increase on your merchant account statement? Below are some of the details of the hidden rate increases on your merchant account statement.
Always read the Fine Print
Financial institutions such as banks have low-profit margins necessitating their practice of passing certain costs onto the customers. Fine prints may contain terms such as “added” or “mark-ups”. These prints should be read carefully as these words have hidden meanings and that all cost must be accounted for.
It is also advisable to read footnotes of account statements as they may contain some hidden charges placed there knowingly and the customers may fail to notice.
Banks Are Required By Law to Notify Merchants of Rate Increases
Banks are required by law to provide reasons and notify merchants of any contract term changes. A notice should be given in advance, approximately thirty days, to give the merchants ample time to find another credit card processing firm. Failure by the merchant to take action within the stipulated timeframe lets the increased rate to take effect automatically.
Reasons for having my rates increased
There are certain factors that necessitate an increase in merchant account rates. These factors include the brand decision as well as law stipulations. The rate increase may also be company specific as some companies have a scheduled rate increase every three years or so.
What do the changes mean?
It is essential for merchants fine prints on both the account statements and the original contract. The original contract should have a glossary of terms, each statement being a summary of the charges for a particular timeframe.
The fine prints may contain both industry-wide words and company-specific words. One should look out for company-specific words as this is where the hidden charges are. It is therefore advisable to contact a credit card processing provider in order fully grasp the meanings of thesewords.
You should keep the credit card processing providers on its toes. This is done by carefully examining the merchant statements and finding the points where the rates change, thereafter contacting the service providers for a detailed explanation.
Below isa list of hidden fees that business owners going through their merchant accounts should watch out for:
- Rate Creep
What few merchants know is that standard contracts contain a provision that allows your provider to notify you, even in a discreet message on your merchant statement, of a rate increase, and that your failure to object to such rate increase within a 30-day period is deemed to be your acceptance of such rate increase. Be sure to read your monthly statements for notices of rate increases.
- Interchange Fee
This is a fee that all merchant service providers charge their clients. The interchange rates are determined by card type (debit card, rewards card, corporate card, etc.), how the card is accepted (swiped, inserted or keyed), and industry type. Despite the fact that most merchants don’t understand interchange fees, it makes up the majority of your merchant services expense. Due to this fact, merchants figuring out they are being overcharged is next to impossible.
- Service Packages
- Application Fee
- Surcharges
- Assessments
To find out more about merchant account services,
go here https://www.qsipayments.com/arizona-merchant-services/