Most registered charities don’t realize they are entitled to a much better rate for accepting credit cards than other businesses. The Processor’s cost of processing credit cards for the average business doing transactions face to face with the general public is 1.42% for Visa and 1.44% for MasterCard transactions for 50% of credit cards on the market. For registered charities they pay .98% for Visa and 1.00% for MasterCard. For all keyed phoned, or online transactions (card not present) the rates are the same.
Now the tricky part, trying to figure out if you are getting a good deal. If you are on an “Interchange Differential” (most common) program you will be paying a base rate:
- Chase it is under “Discount Rate”
- Elavon it is under “Discount Rate”
- First Data it is under “Service Charges”, “Visa/MasterCard Discount”. There is not % rate shown you will have to calculate the rate using the fee as a % of sales.
- Global Payments it is under “Discount” Visa/MasterCard find “Disc Rate”
- Moneris it is under “Transaction Fees” find “Rate %”
- TD merchant services it is under “Visa/MasterCard Credit Rate”
If you have an “Interchange Differential” plan you “base” rate should be under 1.12% for both Visa and MasterCard to be competitive. If you are lucky enough to have an “Interchange Plus” plan like all of our clients you automatically get the savings. There are of course a number of other fees that add up to determine if you have a fair deal but this comparison is a good place to start.
Other businesses that get special rates:
- Special “Every Day Needs” Program Visa and “Independent Business Everyday Spend” category for MasterCard (there are lists of small businesses that qualify)
- Public Sector
- Gas stations
- Grocery and food retail
- Recurring payments
- Large Volume