These Merchant Fees are Ridiculous!

I'm in the process of looking for a merchant account. After reading several forum posts I know I have to read the agreements and thoroughly understand the fee structure.

I have come across some fees that I can't seem to find the definition to. Please help me define the following fees.

• WATTS Fee
• Global/ POS Watts Fee
• Reprogramming Fee
• PQ Charge Fee
• PQ DMP Annual Fee
• Network Fee
• Network Inquiry Fee
• Voice Authorization Fee
• DDA Charge
• ACH Rejection Fee
• ACH Return Item Fee
• ACH Transaction Fee
• Returned ACH
• Resubmitted ACH
• ACH Rate

 

Im looking into merchant accounts ive never heard of any of those fees!?!?

 

ACH Rejection Fee, ACH Return Item Fee, Returned ACH - this is basically an overdraft fee when your merchant provider is unable to take your fees from your bank account at the end of the month. Its like businesses that charge for returned checks. Normally $20 - $30.

Watts, POS Watts, Network Fee, Network Inquiry, - These are basically additional network access fees. Usually $.05 and can almost always be voided.

Reprogramming Fee: Fee for having to reprogram an existing credit card terminal or software. Completely ridiculous fee. Unless you have a cimplex multi location POS system, or some obscure processing method, you should never have to pay this.

Voice Authorization: This is if you call in to get a phone approval on a transaction. Most businesses don't run into this one very often unless they pre-authorize transactions over the phone. Normally above $2 / voice auth.

 

Thanks for the Information. I just came across another fee called the "Interchange Pass-Thru Cost". Any ideas?

 

ACH Transaction Fee: This could be one of two things. They could be charging you to debit your account at the end of the month. Also, if they offer an ACH bank drafting service, this could be the transaction fee you would be charged to ACH your customers account.

Resubmitted ACH: Not positive on this one, but it sounds like they charge you a second time if your monthly ACH is declined.

Not sure about these:
PQ Charge Fee
PQ DMP Annual Fee
DDA Charge

 

Interchange pass-through normally refers to setting up a business on a pass-through fee structure.

Instead of the basic processing fee / transaction fee structure, you set them up with a '+basis points' over interchange structure. That way, whatever Visa and MasterCard Charge, the '+basis points' are added to that, and nothing else is paid.

Pass through is normally setup to be the lowest cost a business can pay for processing.

 

Pass through doesn't always work out best for the merchant, though. It's advertised that way but isn't as cut and dry as that.

Interchange Pass Through (also called Interchange Plus Pricing) is a different way of charging a merchant. Basically Visa and MasterCard have different rates for each different kind of credit card and how that credit card is processed. There are almost 200 different levels of Interchange (as it is called). Processing banks simplify this so when the service is sold it is simpler for everyone involved. By doing this it costs more to accept some credit cards. It also costs less to accept others.

Interchange Pass Through doesn't wrap Interchange pricing up into a simpler package. It takes each level of interchange and adds a predetermined amount to it. By doing this is costs more to accept some card. It also costs less to accept others.

You'd need to know a lot about how merchant accounts work, and your business, to determine which pricing method is best for you. For most merchants the standard three tier pricing method is the best and simplest way to go.

 

That's because most of these fee are obscure and you will not run into them as a merchant. Some probably are also exclusive to the merchant account provider that the original poster was talking to.

 

DDA Charge - did you change your bank account?

The others (PQ Charge Fee & PQ DMP Annual Fee) - I saw them once on a client's invoice - I think the gateway was storing the credit card number for recurring billing and the merchant was being charged for that.

 

Christ!

That was a mess back then!

And now with

1. Stripe
2. PayPal
3. WePay
4. Mastercard Commerce

The fees are so much cheaper

Although 2checkout is kinda pricy still in 2016