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Factors That Can Affect Your Credit Card Processing Rate


Canadian business owners are constantly trying to find the best Canadian merchant account processing rate and often attempt to do so by researching other businesses' rates. However, knowing how much other business owners pay in merchant fees may not be very helpful as several factors can affect a company’s credit card processing rate. Understanding these factors and how they contribute to your processing fee structure can help you determine if you can find a more competitive rate with a different credit card processors so that you can keep a larger percentage of your sales and consequently make more profit.


  • The Volume of Transactions: The simple rule is the more monthly transactions your business has the lower your processing fees will be. Merchant service providers make money on each credit card transaction, so it is not surprising that they want to attract companies that have higher monthly sales volumes. Some credit card processing companies will give discounts once a company’s sales volume reaches a certain threshold while other credit card processors will not approve a merchant until their sales reach a high enough monthly threshold.

  • “Card-not-present” vs. “card present” transactions: When a business owner or employee swipes a credit card this is a card present transaction. When a merchant does not swipe the credit card like with online purchases, this is a card not present transaction. Card not present transactions are much riskier, and therefore business owners may get charged more fees for these types of transactions.

  • Additional Services: Having additional services will also increase the amount of money you pay to a credit card processor each month. Extra services can include leasing terminal costs, gateway fees, statements fees and compliance fees.

  • Credit Card Type: Different credit cards have different rates. For example, many businesses will not take American Express because their rate is higher than Visa or MasterCard. Reward cards and international credit cards also tend to come with a high processing rate.

Based on this information you can determine how your business may fair versus other businesses when it comes to credit card processing fees. For instance, if you have an online business with low monthly sales volume you are likely going to pay a higher rate than a storefront with an higher monthly sales volume. Make sure when talking with different credit card processing companies that you understand how the factors that are unique to your business affects your credit card processing rate.

Sources: Merchant Maverick

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