Paypal Vs Authorize.net

Paypal

Paypal has a special rate for non-profits and a simple fee structure.

We pay 2.2% + $0.30 for each transaction.

Authorize.net

Some people do not like using Paypal. So, we also provide a credit card option. Authorize.net allows us to take credit cards with our billing system.

Regular Authorize.net Fees

(Note: Some merchant accounts cover some of these fees.)

Authorize.net fees with Flagship merchant services:

Merchant Account Facts

You also need a Merchant account in addition to your authorize.net account.

Explanation: Tiered vs. Interchange+

There are two different fee structures that merchant accounts will offer: Tiered and Interchange+

"Most providers will offer a very low "Qualified" rate, let's choose 1.79% + $0.15. What they're saying is that a certain number of card types will "qualify" for the low rate. What they're also not saying is that most cards will not qualify for their advertised rate. There are numerous reasons for cards not to qualify. In addition, most cards will simply not qualify due to their underlying interchange rate." -http://www.dharmamerchantservices.com/learn-more/dharma-pricing-101/tiered-pricing-just-say-no

Chase Paymentech

PDF: Chase Merchant Account Fees (interchange+ pricing)

• Interchange rate + (0.11% for < $1000 mastercard, 0.13% for > $1000 mastercard, 0.11% visa, 0.105% discover)
• $0.10 per authorization ($0.25 for american express)
• $25 minimum fees (total of all fees must exceed $25)
• $9.95 service fee
• $5 monthly fee for authorize.net
• $99 for authorize.net (one time)
• $0.15 batch settlement fee (each day we do transactions)
• $49.50 annual PCI compliance fee

Note: To meet their monthly minimum, we would need to make approximately 41 sales based on ((44.55*.011)+.12)*41=~25 (considering our average sale is approximately $44.55, since 33% are starving hacker, and assuming all sales were visa for simplicity)

Flagship Merchant Services

PDF: Wouldn't respond to my e-mails asking for a fee schedule.

• $5 monthly fee for non-profits
• $15 minimum fee
• There's a $0.10 fee for each day we do transactions.
• Rates are 0.30% + $0.10 per transaction. (on top of interchange fees)
• No account setup fees.
• $100 annual PCI compliance fee
• They cover the $99 setup fee for authorize.net, monthly fees for Authorize.net are only $7.95 afterward.
• Over 100 transactions, also a $0.05 fee from authorize.net
• Tiered Pricing PDF: Link
• Interchange Pricing PDF: Link

Final Offer:

• Lowered rates to 0.15% + $0.10 per transaction to compete with merchant warehouse.

Note: To meet their monthly minimum, we would need to make about 10.5 sales based on this formula (44.55 is our average sale, approximately): ((44.55*.03)+.10)*x=15

Update:: They later added an additional $30 monthly "additional fee".

Chase Vs Flagship Vs Merchant Warehouse Table

Fee Name	Chase Tiered	Chase Interchange+	Flagship Interchange+	Merchant Warehouse Interchange+
Setup Fee	$50	$50	?	?
Annual PCI Compliance Fees	$49.50	$49.50	$100	$99
Monthly Statement Fee	$0 (unless email delivery fails, then $5)	$0	$5.00	$4.95
Monthly Minimum	$25	$25	$25 (debit fees don't count)	$15
Monthly Gateway Fee	?	$5	$7.95	?
Monthly Service Fee	$4.95	$9.95	$0** ($30 hidden fee)	$4.95
Chargeback Fee (rare)	$10.00	$10.00	$25.00	$25.00 (2 free)
Batch Settlement Fee (usually 1x per day)	$0.30	$0.15	$0.10	$0.10
Per Transaction Visa	$0.20	$0.10	$0.10	$0.10
Per Transaction Mastercard	$0.20	$0.10	$0.10	$0.10
Per Transaction Discover	$0.20	$0.10	$0.10	$0.10
Per Transaction AMEX	?	$0.25	?	?
Credit Discount Rate	1.89%	Interchange + 0.105% to 0.130%	Interchange + 0.30 %	Interchange + 0.20 %
Debit Discount Rate	1.69% (very bad!, almost 1% over interchange)	Interchange + 0.105% to 0.130%	Interchange + 0.30 %	Interchange + 0.20 %

• Flagship charges us a mystery $30 "Additional Service fee". Merchant Warehouse says they don't have this fee.
• Chase Paymentech charged a $49.50 annual PCI compliance fee that wasn't in their Fee Schedule flier.

Interchange Rates Example (From Flagship Statement, April 2014)

Dharma

• Reduces authorize.net setup fee to $75
• $15 monthly
• 0.30% + $0.15 on top of interchange fees

Merchant Warehouse

Same as flagship's initial offer, but with:

• $15 monthly minimum
• $4.95 statement fee
• drop the interchange rate down to .20% and .10 per transaction.
• 10 per month gateway fee

Current Merchant Account Fees

Flagship Merchant Services

• $5 monthly fee
• $20 for Authorize.net CIMS
• $15 minimum fee (must get at least this amount in fees each month, this only includes fees from each sale, not monthly fees)
• There's a $0.10 fee for each day we do transactions.
• 0.15% + $0.10 per transaction + the interchange rate
• No account setup fees.
• Monthly fees for Authorize.net are $7.95 (they cover the $99 setup fee for authorize.net)
• When we go over 100 transactions per month, there's an additional $0.05 fee from authorize.net

Our First Statement (Aug 2013)

Here's the split of fees:

Total Card Fees: $41.43 ($24.21 in interchange fees charged by credit card companies)

Batch Header Fee: $1.10 (fee for each day there are transactions)

Statement Fee: $5.00

Min Discount: $12.34 (they are required to make at least $15 off of us, and they charge us the difference, it's odd that this one is so high)

Authorize.net Fees: $8.55 + $20.00 ($7.95 monthly fee, and $0.60 in batch fees, and $20 Authorize.net's Customer Information Manager, which stores customer information so we don't have to be PCI compliant)

Total: $59.87 in fees for $1,860 worth of transactions. This ends up being 3.7% compared to paypal's 2.2%, and more if you include the Customer Information Manager.

"Additional Fees"

After the first few statements, Flagship snuck a $30 monthly charge into the statement called "Additional Fees".