Understanding Merchant Service Provider Rates
In online business today, accepting credit cards is a must. Consumers enjoy both the convenience and the security of buying with a credit card. But as a merchant, accepting credit cards can be costly if you're not aware of the potentially numerous charges levied on merchants by card associations and merchant service providers (MSPs).
Each of your transactions will be classified as either qualified, midqualified, or nonqualified. These three classifications are based on Visa/MasterCard regulations. Transactions that do not satisfy all qualified transaction conditions, as established by Visa and MasterCard, are assessed either a midqualified or a nonqualified surcharge.
The category of credit card used in a transaction is one factor that determines how a transaction is classified. Other factors that determine whether a transaction is classified as qualified, midqualified, or nonqualified are whether the address verification system (AVS) was used and whether the order was shipped within 24 hours.
Most merchant service providers charge a discount rate for each transaction, bundled with a per-transaction fee. The term discount rate is a misnomer because there's really no discount involved. This rate is a percentage applied to the dollar value of each transaction. The per-transaction fee is a flat fee charged for each transaction.
Source: http://www.inc.com/articles/2000/12/21705.html
Each of your transactions will be classified as either qualified, midqualified, or nonqualified. These three classifications are based on Visa/MasterCard regulations. Transactions that do not satisfy all qualified transaction conditions, as established by Visa and MasterCard, are assessed either a midqualified or a nonqualified surcharge.
The category of credit card used in a transaction is one factor that determines how a transaction is classified. Other factors that determine whether a transaction is classified as qualified, midqualified, or nonqualified are whether the address verification system (AVS) was used and whether the order was shipped within 24 hours.
Most merchant service providers charge a discount rate for each transaction, bundled with a per-transaction fee. The term discount rate is a misnomer because there's really no discount involved. This rate is a percentage applied to the dollar value of each transaction. The per-transaction fee is a flat fee charged for each transaction.
Source: http://www.inc.com/articles/2000/12/21705.html
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