And here’s Howie’s input:
Credit card processing is the Wild West and not very regulated. So there are a lot of companies who, to say it politely, stretch their advertising. They promise you 0.000001% over the actual rate, but then tag on all sorts of processing fees, batch fees, deposit fees, verification fees, swipe fees, etc. They may give you a teaser rate for the lowest tier cards (non rewards), but then move up all cards into more expensive tiers. It’s hard to comparison shop unless you actually get numbers from a real customer. Even then, their area may have a different mix of debit, credit, and rewards cards. Debit cards cost much less to process.
Rather than buy a terminal, I use iPhone (other practices use a old iPad) to process credit cards. Use a hand me down when you buy a new iPhone, or just get one on eBay. It’s connected via Bluetooth to the card reader which cost me $80.
I have went through four credit card processing services. A very common card service is Square. But their rates are high, 2.75% swiped and 3.5% keyed. Square is very widely used and in my opinion tends to be better for business just starting up with under $100 in charges per month.
I started off with Intuit go payment which is 2.4% swiped, 3.4% keyed with a fee of 25 cents per charge. They had different plans and I was averaging about 2.3-2.4% out the door with all fees.
Amazon actually had a card processing service with a 1.75% teaser rate for about six months and then 2%. So I switched from intuit. But unfortunately they went out of business. Ho Sun said it was one of the worst days, but we eventually found something better.
But as first I switched to Capital one spark pay, which was $20 per month and 2% swiped and 2.8% keyed. Again I averaged about 2.4% out the door with all fees. They stopped their service too.
Now I have switched for the last time. One of our colleagues in our google group came up with a group offer from a company that charges much lower rates for debit cards than the companies I discussed above. They claim to charge just above actual rates. I had to pay $80 for a Bluetooth reader, while for the above companies the readers were free.
They do tack on some extra fees and have a annual fee of $320, but I along with others in the group are consistently getting 1.7-2% out the door with all fees, including annual, added in. So I believe their pricing is legit. If your volume is higher or you’re in an area with more debit than credit cards your rate will be lower.
Based on a quick google search for “credit card processing mobile 2018” the best company I could find is called Payline and reviewed here. I’ve never had any experience with them, so don’t roast me if the fees are much higher than what they actually advertise.
Just don’t ever do business with a company that has a early termination fee or won’t prorate the annual fee if you change your mind after a trial period.
As Ho Sun’s experience with US Bank illustrates, the bigger banks are usually the more predatory processing companies.