True charges to retailers of accepting credit/debit cards

izools

NFH wrote: »

Don't they work over IP now rather than needing a phone line? And does it dial up for all card types or just some (e.g. American Express)?

No.

PDQ machines dialup by default but more expensive setups are possible - but rarely worth the expense for independent retailers.

NFH

izools wrote: »

PDQ machines dialup by default but more expensive setups are possible - but rarely worth the expense for independent retailers.

That's surprising. The technology between dial-up and IP has a very similar cost. It's similar to the difference on PCs between a modem and a network card. It would make transaction times much faster with no more costly technology for either the merchant or acquirer.

billymadbiker

It's waiting for the customer to find the card, put it back and find the other card' put that back and find the one thay actually want to use, putting it in the reader 3 times to get it the right way round, pulling it out and wiping the dirt off it so it will read, putting it in again, moving the reader so nobody else can see the pin, putting the wrong pin in, searching through half a dozen scraps of paper for the correct pin, moving the card reader again because the sun is on the screen, putting the correct pin in, pulling the card out before the transaction has gone through, putting the card in, putting the pin in, putting the card away, having a moan about how cards are so complicated and they have to remember so many pin numbers, wandering off, coming back asking if they have left the car keys behind.

It's not waiting for the machine to call up that takes the time.

NFH

billymadbiker wrote: »

It's waiting for the customer to find the card, put it back and find the other card' put that back and find the one thay actually want to use, putting it in the reader 3 times to get it the right way round, pulling it out and wiping the dirt off it so it will read, putting it in again, moving the reader so nobody else can see the pin, putting the wrong pin in, searching through half a dozen scraps of paper for the correct pin, moving the card reader again because the sun is on the screen, putting the correct pin in, pulling the card out before the transaction has gone through, putting the card in, putting the pin in, putting the card away, having a moan about how cards are so complicated and they have to remember so many pin numbers, wandering off, coming back asking if they have left the car keys behind.

I see your point, but when I'm in a supermarket queue for example, it's always the people paying with cash that take longer (than those paying with a card) as they find the exact money, and then realise they have more coins they want to get rid of, then drop a coin etc.

billymadbiker

Not when I'm standing in the queue!
It's the people trying to find the clubcard, then the credit card, then trying to redeem 87 pence worth of points after the transaction has gone through.

I like to chuck my shopping on the belt, pass over the cash in notes at the end. Stick the change in my pocket, done.

I do normally find I have £200-£300 in change in the house at the end of each year though!
Normally change it up at the bank just before christmas...

dzug1

NFH wrote: »

Just to point out regarding terminology, the retailer and the merchant are the same thing. "Merchant" is a term used by the payment processing industry to refer to a retail business that accepts payments by card. There are also other terms such as "acquirer" which refers to the bank that processes the card payments for the merchant.

oops sorry - yes I did get the terminology wrong. Perhaps I should go work for the media:D

NFH

I've found a partial answer to my own question. On Visa's web site, there is a page titled "Intra Visa Europe interchange fees - European Economic Area (EEA)", which I assume relates to cross-border transactions within the EEA. It is also possible to bring up a PDF of Visa's fees for transactions within particular countries, e.g. the United Kingdom.

It seems that all credit card transactions are a flat rate without an additional fixed fee, whereas debit cards are charged as a fixed fee within the UK, and fixed-fee plus a tiny percentage across borders. Of course, this only tells us Visa's own element of the charge paid by the merchant, which excludes the acquirer's fee. My guess is that acquirers add fixed fees to credit card transactions rather than the card networks.

As I expected in France, merchants pay exactly the same fees (fixed fee + percentage) to accept debit or credit cards.

w211

I understand that this thread is nine months old, and I'm new here, so not sure, but I'd like to add my reply!

I'm a private hire driver, and I accept card payments using a company to process my card transactions on my behalf. All I pay is a flat fee of 6.5% of the transaction fee. Payment is made direct into my bank account a week in arrears the following Wednesday. I accept UK Debit card, Visa, Mastercard and American Express, using an app downloaded onto my Blackberry. They also do apps for Android and iPhone.

Alternatively, I could rent one of their portable (using GPRS) chip & pin machines for £20 a month, and the transaction fee drops to 5%, but I don't do enough transactions to justify that 1.5% saving.

To cover this cost, if anyone wishes to pay by card for any amount, I just ask for an extra £3 - which covers the fee up to a transaction value of £46. The extra money I make for the lower transactions will offset the cost for the higher transactions, besides as mentioned earlier I should make enough profit to cover the cost.

NFH

w211 wrote: »

To cover this cost, if anyone wishes to pay by card for any amount, I just ask for an extra £3 - which covers the fee up to a transaction value of £46. The extra money I make for the lower transactions will offset the cost for the higher transactions, besides as mentioned earlier I should make enough profit to cover the cost.

Thanks for your contribution. Why don't you simply add 6.5%, i.e. the true cost, rather than £3 whereby the lower fares subsidise the higher fares? I hope the provider doesn't charge you a percentage for accepting debit cards too?

malcolmffc

Why do you have to rent the card readers? Can't you just buy them?