June 30, 2022
by David Goodale
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David talks about the most important things for small businesses to keep in mind when setting up credit card processing. This includes staying away from long term contracts, avoiding cancellation fees, putting your best foot forward for approval, getting lower rates, having automatic rate reductions built into your agreement, and addressing technical concerns so everything works smoothly upon launch.
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Lower Processing Costs with Recurring Interchange
(Edited from video transcript for greater readability)
Hello, David here at Merchant-Accounts.ca with a super quick tip for Canadian businesses.
If your business handles recurring credit card transactions, these transactions qualify for lower interchange rates. An example of such a business would be Netflix because it accepts payments that recur every month. Subscription payments get a lower interchange rate from Visa and MasterCard.
How Much You Can Save With Recurring Interchange
The reduction in the transaction rate you receive depends on the type of credit card. As a best practice, if you own a business that offers subscription billing to your customers, you should guarantee that you're utilizing interchange plus pricing. You can probably save around 0.1% to 0.15% in processing fees which will depend on the card type.
Conclusion
This advice also applies to other regions though recorded from a Canadian-centric perspective. I hope you found this helpful. Thanks for watching. Have a great day there. Bye now.
Related Topics
January 06, 2023
David talks about the most important things for small businesses to keep in mind when setting up credit card processing. This includes staying away from long term contracts, avoiding cancellation fees, putting your best foot forward for approval, getting lower rates, having automatic rate reductions built into your agreement, and addressing technical concerns so everything works smoothly upon launch.
July 11, 2019
In the latest episode of our merchant education series we tackle the seemingly simple topic of costs. In addition to exploring the discount rate and interchange costs, we outline and provide some metrics for the actual rate you should be willing to pay for your business.
March 29, 2023
Why do some businesses get lower credit card processing costs than others? In this video David explores the criteria that cause some businesses to get lower rates than others and techniques that you can use to reduce your processing costs.
May 31, 2021
If you've ever been confused by the difference between a merchant account, a payment gateway and processor you are not alone. In this discussion we break down the role each of those elements play, and how they affect your overall processing costs.
March 29, 2023
In order to accept credit card payments a business needs a merchant account. In this article we explain what a merchant account is, how to get one for your business, and the costs involved.
April 07, 2021
There is a lot of confusion when it comes to pricing in the payments industry. The most important cost of all is the discount rate. Learn what the discount rate is and why it's the most important and significant cost when processing credit card transactions.
July 07, 2023
Making the wrong choice can be costly when choosing a payment processor. David explores 3 of the most common mistakes so you can avoid them when choosing your credit card processor.
August 04, 2023
The debit system in Canada is called Interac. It's totally different from Visa or MasterCard so it works in its own unique way when it comes to making purchases online.
September 04, 2023
If you've not accepted credit cards previously you may wonder how long it takes to get your money. In this video David explores the most popular funding schedules for e-commerce and brick-and-mortar merchants.
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My name is David Goodale, CEO at Merchant Accounts.ca. I launched our business in 2001 and have over 20 years of expertise in the field of online payments. If you have a payments related question or project, and especially if it relates to multi-currency or international e-commerce don't hesitate to contact me. I'm always happy to help with an honest opinion, and enjoy chatting with folks from interesting businesses.
Toll free: 888-414-7111 ext. 5
Direct: (905) 901-2254
david.goodale@merchant-accounts.ca