The single biggest reason that merchants are overcharged on their credit card processing is salesmen throw numbers at them but never explain the math. This is compounded by deceptive and misleading processing statements. The fact that most merchants not only don’t understand, but don’t even read their statements is why these companies can get away with overcharging. This is why pricing changes are disclosed on your statement. If you don’t read it, you don’t know it happened! Many companies are going “green” and requiring you to look at your statement online. They know you’re not going to read it when it’s sent to you, so you won’t go through the trouble to go online and retrieve and review the monthly statement. Many times I’ve shown merchants that they have a non disclosed statement and it’s impossible to do an accurate comparison. Typically the response is that everyone else can do it. This is why most comparisons generated by salesmen have no basis in reality. They’re just a bunch of numbers thrown on a piece of paper to convince you to switch.
The first thing you want to determine is if you are on daily or monthly settlement. Daily settlement means money is being taken out of every transaction, every day. Not only is this an accounting nightmare but it also makes a merchant think that the total charged on their monthly statement is their only fees. I’ve had merchants not realize that they had fees taken out daily. If you take a transaction for $100 and you don’t get the full $100 deposited, you’re on daily settlement. Monthly settlement takes all of the fees at the end of the month. If you take $100, you will have $100 deposited. I recently had a merchant that switched to my company and after they received their first statement called to complain because it looked like they were being charged more with us. We were able to review a statement from her previous processor with her and remind her that they used to be on daily settlement but were now on monthly. Once we were able to prove this to her we were able to show her the savings she was promised were legit.
Credit card processing statements used to be very generic. Statements showed qualified, mid qualified and non qualified. Qualified is usually where swiped consumer credit/ debit cards are priced. Mid qualified is usually where your consumer Rewards cards are priced. Keyed consumer and all corporate cards are priced at non qualified. This is why when a company quotes you 1.49% you see most of your cards going to the mid qualified category. Generally, your clients and community economic position dictates what types of cards you receive. If your clientele is blue collar, you will most likely see more debit cards and few Rewards cards. If your clientele is upper income, you will see mainly Rewards cards and fewer debit cards, which is why non disclosed statements can be so problematic.
Non disclosed statements are the most significant thing I’ve seen happen in the past 10 years. Non disclosed statements are just that. They don’t show whether you swiped a card, keyed a card or took a Rewards card. They just say you took Visa™ or MasterCard™ and you are forced to do the math to determine your rate and most people don’t go through the trouble. These are sometimes listed on your statement as Non Qualified Surcharge or other fees. The reasons for this are to confuse the merchant and to prevent competing salesmen from doing legitimate comparisons. For example, if you look at your statement and it only discloses one rate you probably have a non disclosed statement. I’ve seen statements that say, “As a valued client, your rate is 1.49%.” This is the only place a rate is disclosed on the statement. But when you calculate the effective rate, the merchant is actually being charged over 3.5%. What happened to the 1.49%? This is how processing salesmen take advantage of the merchant’s lack of knowledge.
Doctors, take charge of one of the biggest expenses to your business. Give me and my staff 15 minutes of your time, along with a copy of your current processing statement, and I can show you how the math works. I’ll make sure you know the truth and how to put potentially thousands per month back in your pocket. Don’t delegate this to someone who may not want to let you know how bad a deal they negotiated for your business. Work with me to determine your termination status as soon as possible so I can show you how to get out of your contract with little to no fees. Maybe with this effort I can earn your business. Please contact my office at 844-483-1995. You can fax a current statement to 844-483-1996 for a free, no obligation analysis of your cost.
