Here you go…straight from Visa

Visa Warns Consumers about Retailer Checkout Fees

Visa Warns Consumers about Retailer Checkout Fees

What is a Checkout Fee?

A checkout fee, or payment card surcharge, is an unfair surprise fee that a retailer tacks onto a consumer’s bill when he or she uses a credit or debit card. Visa rules do not allow retailers to charge cardholders a checkout fee for using their cards, mirroring laws in 10 U.S. states. Read on to learn more.

How to Spot Checkout Fees
  • Look for signs or postings in the checkout line warning of the fee.
  • Carefully review receipts where checkout fees often appear next to product descriptions.

What to Do if You Are Charged Checkout Fees
  • Click here to report retailers that are charging checkout fees.
  • Checkout fees are also prohibited by law in 10 U.S. states. Consumers who are subjected to checkout fees in states where they are protected by law may report the retailer to their state attorney general’s office.
Retailers Can Offer a Discount for Cash and Check Purchases
Retailers can encourage their customers to use other forms of payment, such as cash and checks, and can discount for PIN debit and cash and checks provided that the offer is made to all respective buyers.

State No Surcharge Laws Protect Consumers

10 States also Protect Consumers with No Surcharge Laws

In 10 states it is prohibited by law for retailers to charge consumers a fee for using a credit card (California, Colorado, Connecticut, Florida, Kansas, Maine, Massachusetts, New York, Oklahoma and Texas). Consumers who are subjected to checkout fees in states where they are protected by law may report the retailer to their state attorney general’s office.
Click a state below to read the laws on surcharging and find out where you can go if you suspect a violation.

State Laws & Attorney General Contact Information








New York




Check out this two minute video explaining the difference between Interchange Plus and Tier Pricing and how you can save money through Interchange Plus.

 Not all of Credit Card Merchant Services Reps are crooks.

Those Merchant Services Reps knocking on your door likely fall into one of three categories:

  • An experienced rep that wants to do the right thing and may or may not have the company to facilitate that.
  • A new rep, who desperately needs to not be thrown out the door – if for no other reason than to give hope that someone will at least listen. (High failure rate because we don’t make as much as you think we do.)
  • The crooks. (Yes, they do exist.)

So how do you tell the difference?

Signs of a good Rep.

  • Do they look you in the eye? Watch their body language. How do you feel with them?
  • Do they listen to your needs first before selling you a solution?
  • Do they explain why you are paying what you are paying and how they can help?
  • Do they focus on customer service and price?
  • Do they let you review the contract before signing it?
  • Do they push leasing equipment? (I hope not.) Do they offer it for special circumstance? (I hope so.)
  • Do they openly discuss ALL fees.
  • Do they want to put you on Tiered pricing or do they talk about Interchange Plus? (Go Interchange.)
  • Do they encourage you to monitor your statements? (They should.)
  • Do they follow up with you and offer reviews or do they disappear after the sale? May not be a crook, but you may want to at least get an annual review from someone to make sure you have a good deal.

How to spot a crooked Rep.

  • Do they tell you can get you one great rate? (Don’t let door hit them on the way out.)
  • Do they give you time to review the contract or pressure you to sign on the dotted line.
  • Does it sound too good to be true? Does that spidey sense go up? Ask for references you can call.
  • Do you like them? Again, your intuition will tell you a lot.
  • Do they avoid the discussion on fees?
  • Do they try to push the purchase of expensive equipment, or worse “Help you” by pushing a Lease.

One final note…

When someone walks in your door, give the benefit of the doubt. Unless you have established that you have a great deal, they may be able to save you money. If you know you have a great deal and you are happy with who you work with. Just tell them that you have verified you have a great deal with others and that you are happy with your provider.

Remember that they are more than likely not a crook. They are trying to earn a living and put food on their table and they are doing that by trying to save you money.

Even if you are in a contract, if you don’t know if you have a good rate. If you’ve never had contact after your sale from your rep, you owe it to your bottom line to pick one that you jive with and let them have a few minutes and see if they may be a good fit. Do this even if you are under a contract. You never know. They may just save you enough money in the first few months to pay for getting out of it. Then money returned to you.

After all, it’s not what you get, it’s what you net!

Lynda Colter-Bergh  970-235-0064   lynda@myCCMS.net

I keep hearing how great Intuit rates are from people I network with here along the front range of Colorado in Fort Collins, Loveland, and Greeley.  So, I thought there was something I must be missing.  Nope.  But I can see now why it appears that they have such great rates.

Intuit Online Pricing

Intuit Online Pricing

That doesn’t look so bad at first glance.  But, as Paul Harvey would say, “and now, for the rest of the story.”

Intuit Pricing details

Intuit Pricing - the rest of the story...

(You can click on the picture for a larger image).

So Here’s the rest of the story…translated.

You will only receive the 1.90% plus .30 transaction fee if you buy and use the $69 card reader that would be connected to you PC and IF the card is a “Qualified” card.

If you take an order over the phone, then the rate is 2.93% plus .30 transaction fee IF the card is a “Qualfied” card.

For any “Non-Qualified” cards, you will be charged 3.91% plus .30 transaction fee if you do not buy their reader and swipe the cards.

“Qualfied” cards are defined by them as the BEST interchange program, which means that the majority of the cards fall into the “Non-Qualified” realm.

So now you know the rest of the story.

When you get the right processor, who is looking out for your best interests, you can not only will have better pricing, but more options to meet your business needs.

If you want to know your options, please give me a call or drop me a line.

Lynda Colter-Bergh



How to avoid charge-backs and fraud when processing credit cards

For a merchant, credit card processing is critically important to your business’s success. If you don’t then you are losing as much as 70% of your online sales to competitors who do accept credit cards according to an article published by Forbes Magazine.  You will also lose brick and mortar sales.   In fact 49% of consumers said they use their debit cards on a regular basis (most of whom swipe them as credit).

While there are many great benefits in accepting credit cards, there are also potential pitfalls.  A few things that you need to consider in order to avoid fraud and charge backs follow.


Stop fraud before it starts

Recently, we had a string of fraudulent purchases by a group of people who rented hotel rooms and then went out and bought hundreds of dollars at stores with stolen cards.  The scary part was that many of the merchants suspected something was wrong, but didn’t question the purchases because they didn’t want to potentially offend the buyers.  Many didn’t ask for a Driver’s License to check the signature.  Most didn’t know to call the number on the back and ask if there was suspicious activity on the card.  Had they done so, they could have denied the purchase and simply said that the credit card company reported suspicious activity on this card.  Until it is straightened out, they will have to hold the merchandise.  Better to lose the sale then the merchandise and the sale.

How to protect yourself from fraud and charge-backs

  1. Insist on getting the CVV number (that 3 digit number on the back of the card, 4 digit for AMEX).  Credit card companies estimate that around 25% of charge backs can be avoided by demanding that number.  This is such an issue that some processing companies refuse to process cards without it.
  2. Don’t hesitate or be afraid to exercise extreme due diligence with suspicious orders. It’s imperative to verify the customer and his address if you get an order that is out of the ordinary, seems strange, or just doesn’t feel right. Satisfy yourself that the transaction is authentic.  Call the credit card 800 number on the back and ask if there has been suspicious activity on the card.
  3. Exercise caution if you have an International Transaction.  Period.  However, the major culprits for fraud are Eastern Europe, Asia, Africa and developing nations.  A warning flag would be an order for a large quantity of high priced items.
  4. If you get a big order that insists on overnight shipment, be wary.  I know this is harder to do over the holidays.  But this is really important if it can be sold on the street.  This applies to very large orders of smaller, easy-to-sell items as well.
  5. If you receive a suspicious order ask for and get copies of identification and the credit card being used.  Did you know it is perfectly legitimate to demand that the purchaser fax in copies of their licenses and credit cards?  This will help offer you protection from fraudulent purchases. A legitimate customer may object and say it’s too much hassle, but consider the fact that in that case you may only lose the sale.  However, if you shipped to a fraudulent buyer you would lose the merchandise and the cost of shipping to him.
  6. Take advantage of the Internet. Use Google.Com or 411.Com (reverse phone lookup) to verify addresses and telephone numbers.  Often you will see people who have posted if they were ripped off.
  7. Pay the extra to get a signature for deliveries.  Specify that the delivery service you use gets a signature when delivering your product to customers.  Get copies of these signatures for your own records.  Your buyer may tell you to have the delivered package left on the porch.  Did you know that you’ll have to replace it if he can’t find it when he gets home without this precaution?  Always get the signature.  I personally experienced this selling items on eBay.  Even after I paid for the signature, this person tried to say they didn’t get it.  Smart, right?  I was able to prove that he did because I followed this rule.
  8. If a card doesn’t swipe, get a copy of it with a manual swiper, write the purchase amount, time and date and “processed electronically,” have the person sign it and get a copy of their Driver’s License or at least write down their number to prove they were there and you visually matched the signature with the card.  If you don’t the person can say it wasn’t them that made the purchase and if you said the card was present (which you would do if you had it in your hand) as you punched it in, they can dispute it.
  9. Make sure the person using the card is the person that is supposed to use it.  Again, if you don’t check against a driver’s license, then it could be contested.
  10. Make sure your employees understand how to handle these situations up front before they happen.  Be firm and consistent with your procedures.  Make sure they understand you back them if they feel suspicious about a sale.

Putting the points above in use will reduce, if not eliminate fraudulent purchases. Most criminals avoid doing business with companies that take safety and security seriously. They will quickly move on to many other places that are easier prey.

Two more tips that could save your business:

If you are taking credit cards on-line, make sure you are using secure servers and that you have great virus protection on your computer.  A single breach could cost you your business because of the fines, not to mention the unpleasant call to your clients.

  1. Don’t store cc data on your laptop.  Seems to make sense, right?  You’d be shocked at how many people do.  A stolen laptop is a huge risk for a business.
  2. Always make sure your computer is protected with a top-notch virus protection software that is updated automatically and make sure your website pages that take credit cards are on a secure server (https://)

Is Square right for your credit card processing needs?

The Square

Square has become a favorite for merchants that are in the service industries and artists as well as for many other business owners that don’t deal with a high volume of sales.  It’s too cumbersome for a lot of purchases.   Why is it so popular?  It’s convenient, they see everyone else doing it, there are no or low startup costs, the rates are easy to understand and seem reasonable. But when is using the Square no longer a good deal?  Here is a quick run-down on why it is popular and its drawbacks.

What is Square?

Square was founded in February of 2009 by Jack Dorsey, the founder of Twitter.  Square has seen tremendous growth in a very short amount of time.  Square credit card readers are those small white (or black) box readers that plug into the headphone jack of your Smart Phones.  By removing the barriers and intimidating unknowns and perceived hassles that come with selecting a credit card merchant service, Square, sometimes referred to as SquareUp because that’s the domain, has skyrocketed in popularity.

Square doesn’t use sales Reps

Let’s face it.  Our industry doesn’t have a great reputation for honesty.  The horror stories are rampant.  Square eliminates the sales rep from the equation.  The merchant simply signs up online and never has to talk with anyone.  There are no hidden fees, equipment rentals, startup fees, or opportunities to be overcharged (something prevalent in the merchant services industry).

Square Terms

Square’s pricing is straight forward and easy to understand.  You pay a flat 2.75% if you swipe the card, 3.5% (as of this article – up from 3.15%) plus a 15 cent transaction fee if you have to manually input the credit card.  There are no monthly fees.

There are no other fees that are typical of credit card processing, such as activation fees, monthly fees, gateway fees, online access fees, equipment leases (never lease equipment), service contracts, downgrade fees and early termination fees, PCI fees for compliance, annual fees and whatever else can be drummed up… See why Square seems so much more appealing?  When faced with all that, many merchants just want to opt out of the selection process.  Mind you, many of these fees are unnecessary and aren’t charged by processors that are in the business relationship with you for the long haul.

Square Terms (the fine print)

Square doesn’t verify the credit history of merchants at the application stage, (a benefit for some), so it sets a few limitations to avoid losses to fraud.  There is no limit to the amount of money that can be accepted per transaction or per month.  However, Square will hold the sales from cards that are manually entered for 30 days if more than $1000 is charged within any rolling seven day period.

Let me say that again.  If a merchant types the credit card information into the phone instead of swiping it through the card reader, (which happens because the readers can be a bit touchy), the merchant will have a rolling seven day processing “limit” of $1000.  The merchant can continue to accept transactions, but the funds will be held. Typed-in charges under the $1000 limit, and all swiped transactions, are electronically deposited into the merchant’s linked checking account usually within 24 business hours.

When you first start using Square, the fine print says that they have the right to hold your funds for a month while they check you out.  If you are tight on funds, you need to be aware of this potential hiccup in your cash flow.

For merchants that regularly process more than $1000 in seven days, Square can work with you.  If you are in good standing and have few refunds and very few to no charge-backs, they can raise your limit upon request via email.  However, you may have to provide more information about your business to raise the deposit limit.  If you are charging that much, you are really paying too much if you are still using Square.

Square Customer Service (or lack there-of)

All you have to do is search Google for “square complaint.”  It is nearly impossible to actually get a live person should there be a problem.  The company uses email, Twitter and a support FAQ page to handle questions and complaints.  Turn-around on inquiries is often in days, not hours.  (This can come into play if you have charge-backs.  If you have to produce a receipt, it may not come in time.)  My recommended solution is to email a copy of the receipt to yourself and then to the client.  Then you will have a copy to produce.  For a company with a value of over $1billion, I personally find that unacceptable.  Square also has had a lot of complaints about problems with lost transactions and batches that didn’t go through as well as the card readers failing.  Don’t believe me?   The Better Business Bureau gave Square an “F” rating with 29 complaints over the past 36 months.  You can go to the BBB website to see details.

When is it appropriate to use the Square?

For start-up companies that don’t know the volume they will have or for ones that have a low volume of credit card sales, then Square may be all you need.  But it doesn’t make sense if you are processing more than $500 – $1000 in credit card purchases per month.  At that point, you would be better served by becoming an informed consumer and work with a credit card merchant services processor that isn’t afraid to show you the fine print, who discloses all the fees, charges reasonable Interchange Plus rates, and doesn’t tie you into a lease for equipment.

Understand your options – Tier Pricing versus Interchange Plus

You can either be charged what is known as Interchange Plus, which is basically a Wholesale Plus model or you are charged by “Tiers” (usually 3).

Tiers are usually broken down into these levels:  The “Qualified” rate is what you generally see quoted in those sounds-too-good-to-be-true advertisements.  These quotes are for the lowest risk cards available, the swiped check cards (bank credit or debit cards).  There are over 100 different designated types of cards that are divided into these different tiers.  The “Mid-Qualified” and “Non-Qualified” Tiers are those that are have higher cost to the banks or are higher risk.  The highest rate you pay as a merchant for processing cards is for a Business Cards with Rewards.  They will cost you the most.  The base rate of Square is generally at the Mid-Qualified tie pricing.  The 3.5 near the Non-Qualified Tier or the highest rates you would pay in a tiered system.

Now let’s look at Interchange Plus.  Square is much more expensive than the Interchange Plus billing model – especially since the Durbin Amendment.  (By the way, with few exceptions, Interchange Plus is the way to go.)  With Durbin, banks that have more than $10 billion dollars in assets became capped on the amount they could charge merchants for processing their cards.  This accounts for approximately 77% of all Debit Cards.  These rates dropped below 1% in the Interchange plus model.  So, with a tiered or flat rate model, the processor (Square or someone else) keeps the difference.  Now, the downside is this.  If you get a lot of Commercial credit cards issued to businesses, then your rates could go a little over 3.5%.  But in most cases, that’s rare.  You have to do a little math to figure out what will make sense.

That’s where I can help.  Contact me for a free evaluation.  It’s as simple as faxing me your current statement with a request for a comparison.  By looking at your statement (whether it is from Square or another processor), I can teach you how to understand what you are looking at (should you be unclear) and I’ll give you an idea of what it would run if you did Interchange Plus compared to what you are paying now.  Let me teach you how to review your options as an educated consumer.  Most of my clients save an average of 20% off their service fees.  Some save even more.

Lynda Colter-Bergh