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Why All the Calls?! (Must Read)

So you’re getting all kinds of calls saying that you need to do something right? You’re not alone. This has become the way companies are approaching businesses these days. I will go over a few of the most common and shed some light on what they are actually saying.

We are a regulatory company:

First off there is no such thing. The Merchant Service Industry is not regulated by a company that is calling to gain your business. Visa could be considered the real regulatory company but they will never ask you for your statement or anything about how much you process and with who; they don’t care. This is a common way to get your interest and get your statement. These people sound like they are real but they are simply just a processing company trying to get your business.

We are a wholesaler:

Again, there is no such thing. Some people have made this their cornerstone in approaching people over the phone. The fact of it is there are no “wholesalers” in the industry. They may say that they pool hundreds or thousands of businesses into one portfolio to get you the best rate but their rates never change and they want a statement to show you what they can do. Why would they need a statement if all they are doing is pooling businesses? All Merchant Service companies pay the same Interchange Rates to Visa and MasterCard for your processing. They DO NOT and CAN NOT change due to a company being in a special group or bank.

We are direct:

This actually has a little ground to stand on. There are many direct processors out there. All it simply means is they are the actual processor and not an ISO of one. First Data is a great example of direct. They do all of their processing themselves. If you sign up with First Data you are direct. If you sign up with a sales office in Manhattan that is an ISO of First Data then you are not direct. Once you start getting further and further away from the actual processor then you are getting more and more of a markup because everyone needs a piece of the pie to make a living. If you are approached by a company saying this you should ask them who they are and who they process through. From there make sure you do your research on them before you send them anything! There are a thousand ways that companies have tried to gain your attention and your business over the phone. I could spend all day telling you about the ways business owners have gotten hooked into something they were promised was good and it is an absolute nightmare. Instead of that I will just leave you with some important things to consider and know about these calls. -Any company calling saying they are your company will have access to everything. They will never ask you to send them anything because they already have it! -No company is investigating your company for overcharging you. There is just no such thing. -Your account is not flagged. Again, this just does not happen in the way they are saying it is. -They are not a wholesaler or regulatory company. They are a competing processor who wants your business. -DO NOT believe them! No matter what they say you need to beware. All they want is to sign you up, get paid and run. They don’t have to deal with you anymore than that. Call the 800 number and try to get them to resolve a billing issue, it won’t happen. -Google it!!!! I can’t stress this enough. Google the company, read the reviews. This will tell you what others have experienced. -Finally, if you do decide that you want to give a company a shot make sure you get the full application and the rates and fees sent to you before you sign anything. Look them over and make sure they match the quote. Have other people look it over with you. A lot of the time the original quote doesn’t match what they want to sign you up at. As always NCP is here to help. Contact Us if you need help with these things.

Making the Right Choice

When it comes to finding the right company it is very important you make the right choice. There are literally thousands of companies that offer credit card processing but which one is right for you and how do you know?


When you are considering a company make sure you do your research. Google is your best friend! Make sure you look at as many sources as you can. If you have the name of the sales rep then Google their name. A lot of times you can find out what to expect from just reading up on them.

Beware of false truths!

So many times people get caught up in deals that seem too good to be true and find out later that they are not. Have you ever seen the ads or gotten the calls saying that a company only charges 1% or .25%? What does that mean? How can they be so cheap?! Well, they can’t be.

The fact of the matter is every processing company no matter how big or small pays the exact same rates to Visa, MasterCard and Discover. If they are telling you they only charge 1% then what they are really saying is that they are only going to charge you 1% above Interchange. For nearly every business out there this will raise your current bill substantially. Let alone they will have other fees that will furthermore raise it, and a contract to lock you in. DO NOT fall for this. It cannot be done!

What to ask?

When you are looking into a new company, don’t let them tell you what you want to hear. You need to interview a company like you would a new employee. You wouldn’t just hire someone to handle a large portion of your funds without at least asking a few questions, right? So what should you know?

What are my rates?

A company should be able to answer this definitively. If they start bobbling around saying, “It depends on what cards you take,” then they are not being up front with you. You should get an answer like, “You will pay the Interchange rate and .25%.”

Is there a contract?

This is easy enough. Yes or no and how long is it? Another important addition to this is you should know just because you are in a contract with a company does not mean that your rates and fees are locked in for that time. The only thing that’s locked in is you.

Can I get all the rates and fees before I sign?

You should be able to inspect a full application before you sign anything. That will tell you all of the rates and fees. Look for things like: PCI Compliance Fee, Regulatory Fee, Customer Service Fee, Statement Fee, Batch Fee. Much of the time people do not ask about those fees and they add up quickly. You can generally find all of the fees a processor has in one section or page of their application. If you ever have questions about anything we are here to help. If you just need an honest answer or if you need an explanation Contact Us.

Knowledge is Power

With such a large portion of business these days on plastic you need to know everything you can about the industry. It usually represents one of the highest expenses a business had each month too. So what can you do to better understand Merchant Services?

Do your research

Google it! There is a ton to know about the industry and how you can manipulate it to benefit your business or cost you less. If you take the time to learn just a few things then you will have the upper hand in negotiating versus the salesperson you are talking to. I will outline a few here.

Interchange Rates

You probably have heard of this term and may even be familiar with it. Simply put, Interchange is the actual cost of the given card you are taking. There are three levels of interchange in a retail business. Swiped, the cheapest. Keyed with AVS (address verification service), second highest. Standard or EIRF, the highest rate you can pay. Interchange is also becoming a very popular way to set up an account. It is by far the cheapest way too. You should have a basic understanding of Interchange.

I like the explanation here

You can always learn the whole thing since Visa and MasterCard are public companies by visiting,


PCI Compliance

PCI Compliance has been around for almost a decade now and many of you are still paying non-compliant fees. You may see this on your monthly statement as a monthly charge. It is one of the easiest fees to get rid of all on your own. Many times you just have to visit the companies site and answer a questionnaire and it goes away. For most of you this needs to be done once a year or the fee will return until you do it again. Most of the time when you become compliant your provider will refund some of the non-compliant fees too; just ask.


If you have ever taken cards then you are familiar with contracts and early termination fees. One common misconception is that contracts are required. This is simply not true. Every processor will waive their contract in most cases to get the account. Another false truth is that if you are under contract then your rates won’t change. If you actually read all the fine print there is always a section that states the processor can change your rates and fees at will with a simple notification. All contracts really do is hold you prisoner to that company and make sure you can’t just switch without a fee. When you are entering into a new agreement with a company and they say they will waive the contract make sure it is noted on the original paperwork or you could get caught up in a contract even though the rep said there was no contract.

Tiered Rates

This can be confusing for most merchants to decipher what they are actually being set up with for rates but there is one easy way to tell. If you have more than just one rate from the company then it is tiered. This does not include any Interchange rates. If you are being proposed a rate for Debit, Credit, Rewards, and key entered cards then most of the time you are being proposed a tiered account. You DO NOT want such an account. The main reason for this is because the processor will make a larger mark up on a given card than a flat Interchange rate would give you. 99.99% of the time Interchange is the way to go. The other .01% of the time the rep messes up and charges you too little for a category and the company loses money on you. Make sure you ask questions on how they are setting you up, Interchange or Tiered.

Free Machines

You have seen the advertisements and maybe even gotten a “free machine” from a company. I hate to say it but it’s true, nothing is free. What do you have in your business that you would just give away because someone is interested in shopping there? Companies have to spend money to get the terminals. If they give it to you then where does that expense go? Most of the time they will add an additional annual or monthly fee. They will also tack it on your rates so that you slowly pay for it over time. The best part of this is after you have been with that company for a few years they have made three times the value of the terminal off you and you never own it. If you switch you are required to return the terminal or pay a fee to keep it.

Ask for better rates

It never hurts to simply just ask if that is the best a company can do. There are numerous ways to set up accounts and adjust fees. Some will give you a really low rate but a high monthly fee while others are just the opposite. No matter what they are proposing ask them to go lower. I’d be willing to bet they will just to get the business. In closing there really is a ton to know about the industry. The points above are just the surface and the most common things I see customers fail to check on before they commit to a company. If you have questions feel free to Contact Us and we can help with them.

Fee Increases

Spring is a time when most business owners look forward to an increase in sales. This is also true of your Merchant Service Provider. Most companies will raise their rates once or twice a year. April has become one of those months when they like to raise rates. This is to align with the card brands adjusting their costs to the provider. There is more to increases however…

Why are there increases in fees?

Fees are generally increased when the pricing model does not generate enough profit. This is not necessarily true when it comes to credit card processing. Depending on if you have a Tiered or Interchange Plus pricing model your costs are already covered by the markup. On Interchange you get rates passed directly to you from the brands. This means that your costs are already covered. On Tiered you can actually be priced lower than cost on some cards but the majority are priced higher.

When and where are fees increased?

With most processors you will see fees go up once or twice a year, in the spring and fall. It is true that the brands do adjust the rates twice a year but it doesn’t always mean they go up. In the recent, past fees on some rewards cards and debit cards have actually gone down. You may not have actually seen this adjustment go down because processors like to hide behind the brands and just say they went up.

There is a couple ways to tell if your rates are going to be affected.

By now you should know if you have an Interchange or Tiered pricing model. If your account is an Interchange Plus account then you will generally see increases to your markup above interchange or your transaction fees. You may also see them in an additional monthly fee. On a Tiered account you will generally see the increase in your mid and high range rates. One easy way to tell is to simply read the notes section on your account. You can also dive a little deeper by checking your Net Rate. This is done by dividing your total fees into your total amount processed for a given month (Fees/Volume = Net Rate). The resulting number should always stay similar throughout the year with similar processing volumes. If it goes up then your fees went up.

What can you do?

You can always do something about fees going up. For one, do some research. Check Visa’s and MasterCard’s sites to see if there have been any increases. If there are no increases or nothing significant, call your processor and let them know that you’re not going to put up with it. If they refuse to work with you then switch. You should be able to get out of any contract you have since they are changing the terms and you do not agree with the new terms. If you would like an outside opinion or a quote from a company that does not raise fees Contact Us for assistance.

About Us

North Country Processing LLC is a consulting company specializing in business products and services. North Country Processing LLC is not a Merchant Service Provider.

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