Credit Cards Processing For Small And Big Companies

FOR IMMEDIATE RELEASE
ANYWHERE , California, United States of America (Free-Press-Release.com) January 13, 2012 -- Blindbid is conducting a series of whitepapers to empower small business merchants to save on their processing and avoid getting ripped off.

Credit card processing continues to become more complicated with new fees, technology and regulations. We realize that you can be overwhelmed with all the changes. Blindbid offer white papers can help so that you can focus on running your business and taking care of your customers.

As a small business owner, you are inundated with offers from credit card processing companies that promise to save you money. Usually most offers start with a low rate. Each merchant services provider tries to trump another with that lower rate to win your business. If you have been in business for some time and switched processors, you might have realized that these low offers do not always pan out.

In fact from 2000 to 2010, the average credit card processing rates for retail have risen from about 2.00% to 2.66% not including extra fees like statement fees, batch fees and PCI fees. This rise is despite a huge drop in debit card rates and increase in debit card usage. Why the increase? Rewards cards are one of the main culprits. Banks are passing on the cost of those fancy rewards, airline miles, etc, to the merchants.

The second main reason is a lack of merchant processing education. Merchants are trained by the banks to respond to low rates. The problem is that there are 440 Visa/MasterCard/Discover rates and the banks are only showing you the lowest transaction rates. (For a listing of rates www.visa.com and www.mastercard.com)

The correct question to ask is not “what is your rate?” but “what is your effective rate?” The effective rate takes into account all the possible Visa/MasterCard/Discover categories for which a transaction may qualify. Knowing your effective rate will give you a more accurate estimate as to the true cost of your processing. You can figure out your effective rate by using a simple formula.

Effective Rate = Monthly Processing Charges/ Monthly Processing Volume.

For example: If you process $10,000 dollars a month in volume and your processor charges you $300, your effective rate is

$300/$10,000 = 3.00%

To find out where your effective rate compares nationally, go to this link =) http://bit.ly/safecreditcardprocessing

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