James Lee's 7 Steps Reducing Your Card Processing Cost What Every Merchant Must Know

7 Steps Reducing
Your Card Processing Cost

What Every Merchant Must Know
Are you frustrated with high costs from your current merchant account provider even if
you have been switching to several processors?

One of the most confusing aspects of obtaining a merchant account can be
understanding the dizzying array of fees involved.

Then take a time to read until you know 7 essential key knowledge
Enables you to Reduce Your Card Processing Cost

You will get explanation of all the various fees you may run into when obtaining a
merchant account, as well as some hidden fees and other junk fees you need to look out
for.

Step One: Know Who can have the best pricing on payment processing
Step Two: know Key Elements of Processing fees you pay
Step Three: Know Processing Fees Detail
Step Four: Know Three Pricing Elements of Your Processor
Step Five: Know What is best type of processing pricing Models for you
Step Six: Know Who can bring the best profits
Step Seven: Do it to sign up free pricing consultation
These copies were created by James Lee and opinions expressed here are the personal opinions of James Lee, an account execut ive of
Clearent. Content published here is not monitored or approved by Clearent before it is posted and does not necessarily represent the views
and opinions of Clearent.
7 Steps Reducing Your Card Processing Cost
James Lee
M. 917.930.3945
F. 718.661.0014
www.about.me/paymet101
Your Reliable Payment Processing Consultant
Ask About
Merchant Services
James Lee M. 917.930.3945
AplusPayments@gmail.com
http://b2breferral.wix.com/home

Step One:
Know Who can have the best pricing on payment processing
We meet so many merchants fed up with the services fee for payment processing and a lot of merchants dont really
understand the merchant service business or are at least confused by some aspects of the industry we dont blame
them as it can be very complex and sometimes intentionally misleading.
This is really hard to figure out and the credit card processors would like to keep it that way. There is almost no
uniformity in the way credit card processors charge for the payment services and present their monthly
statements. This of course makes it difficult to compare pricing and the processors work this to their advantage.
There is no regulation of this industry so merchants must always review their monthly merchant processing statement
for new fees and rate increases. Unfortunately, most merchants dont understand the confusing monthly merchant
statements and for that reason they dont review them.
First there are different pricing plans and you are either in the Tiered Pricing Plan (a/k/a 3-Bucket Plan) or the
Interchange Pass-Through Plan.

Thats why we created 7 Steps Reducing Your Card Processing Cost

A merchant services is a type of bank services that allows businesses to accept payments by payment cards, typically
debit or credit cards. A merchant account for merchant services is established under an agreement between an
acceptor and a merchant acquiring bank for the settlement of payment card transactions. In some cases a payment
processor, independent sales organization (ISO), or member service provider (MSP) is also a party to the merchant
agreement. Whether a merchant enters into a merchant agreement directly with an acquiring bank or through an
aggregator such as PayPal, the agreement contractually binds the merchant to obey the operating regulations
established by the card associations.

James Lee
M. 917.930.3945
F. 718.661.0014
Ask About
Merchant Services
James Lee M. 917.930.3945

To get the best card processing rates, you will need to do your homework well.
Research thoroughly for the most affordable terms and conditions, but make sure that the company is reputable, as you
dont want to be stuck with poor customer service, especially when their service is costing you money!
Things to factor into the equation when estimating your card processing rates include your average number of
transactions per month, your profit margin, your average order size, and how often youll be accepting credit cards from
your customers. Obviously, high-volume retailers will want to focus on reducing their discount rates and per-transaction
fees more so than their monthly fees and so on, where small businesses with a larger order size but less transaction
volume can be more flexible with reducing credit processing rates.
Talk to other shoppers and compare the credit card processing rates they found with your own research. Accepting
credit cards should be a profitable investment and free of exorbitant credit card processing rates if you choose the
right service.
Just call at 917-930-3945 to sign up free consultation,
For the best result, email at AplusMerchants@gmail.com or fax us (718-661-0014) two
consecutive processing statements and well give you an honest comparison
Then we will show you exactly how our rates compare to what you are paying now and
show how much you will save when you work with James Lee to properly establish your
credit card processing.
The other easy way is to find some one who is real reliable
payment consultant like James Lee and ask to do it for you
Special Pricing could work very well - your fee schedule will be designed to fit your unique business through a reliable
payment processing consultant like James Lee 18 years payment industry expert with considering all of pricing factors

Pricing factors make the processing cost different
James Lee
M. 917.930.3945
F. 718.661.0014
Ask About
Merchant Services
James Lee M. 917.930.3945

Step Two: know Key Elements of Processing fees you pay

A Merchant Account has a variety of fees, some periodic, others charged on a per-item or percentage basis. Some fees are set
by the merchant account provider, but the majority of the per-item and percentage fees are passed through the merchant
account provider to the credit card issuing bank according to a schedule of rates called interchange fees, which are set by Visa,
Discover, and MasterCard. Interchange fees vary depending on card type and the circumstances of the transaction. For
example, if a transaction is made by swiping a card through a credit card terminal it will be in a different category than if it
were keyed in manually.
In the merchant industry, sometimes its not as simple as comparing apples when youre comparing credit card processing
rates. There is a plethora of different card processing rates, fees, and billing structures, making it hard to understand how one
service compares with another.
As a merchant, you can really benefit by researching the terms and conditions of the fee structure associated with your
prospective merchant services. Make sure to ask the companies to forward you their terms and conditions, and understand
them fully before taking the plunge:

Initial set up cost such as application fee
The Pricing Model applied including discount Rate and total cost of each sales transaction(transaction fee+ item fee +
authorization fee),
Monthly and annual recurring Fees: Read the terms and conditions and look for specific sections addressing fees,
hidden Surcharges structure: PCI compliance fee etc
Cancellation Fees: If you dont want to be locked into a contract, look for a company that allows you to cancel at anytime.
Equipment pricing: Learn who owns equipment if you quit processing with your provider, and about a replacement cost if
the equipment is damaged.

In addition to those factors, shop around to find the best processor like Clearent if you want to get the best possible credit
processing rates. There are many options, pricing plans, and incentives available for setting up a merchant account; find out
which one suits you the best. Some dont charge installation fees, while others will charge a one-time overall fee but give you
other perks free.

For one example of how interchange functions, imagine a consumer
making a $100 purchase with a credit card. For that $100 item, the
retailer would get approximately $98. The remaining $2, known as the
merchant discount and fees, gets divided up. About $1.75 would go to
the card issuing bank (defined as interchange), $0.18 would go to Visa
or MasterCard association (defined as assessments), and the remaining
$0.07 would go to the retailer's merchant account provider. If a credit
card displays a Visa logo, Visa will get the $0.18, likewise with
MasterCard. Visa's assessment is fixed at 0.1100% of the transaction
value and MasterCard's assessment is fixed at 0.0950% of the
transaction value. On average the interchange rates in the US are 179
basis points (1.79%) and vary widely across countries. In April 2007 Visa
announced it would raise its rate .6% to 1.77%.
James Lee
M. 917.930.3945
F. 718.661.0014
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Merchant Services
James Lee M. 917.930.3945

Discount Rates
The discount rate comprises a number of dues, fees, assessments, network charges and mark-ups merchants are required to pay for
accepting credit and debit cards, the largest of which by far is the Interchange fee. Each bank or ISO/MSP has real costs in addition to
the wholesale interchange fees, and creates profit by adding a mark-up to all the fees mentioned above. There are a number of price
models banks and ISOs/MSPs used to bill merchants for the services rendered. Here are the more popular price models
Types of Transaction Fees
Below is a list of credit card transaction fees with a description followed by the name various processors typically use to refer to each
type of fee.
Authorization fee
The Authorization fee (actually an authorization request fee) is charged each
time a transaction is sent to the card-issuing bank to be authorized. The fee
applies whether or not the request is approved. Note this is not the same as
Transaction fee.
The authorization fee is the most widely publicized transaction fee, and it's
often what a processor refers to generally as its transaction fee.
Authorization fees are often referred to on processing statements as: POS
AUTH , AUTH FEE , DISC P/I , Authorization Fee Or Auth The
Per Item Fee
Per items fees are charged each time a business's equipment contacts that
processor to get or give information. A per item may be charged in place of
or in addition to other transaction fees such as authorization fees.
Per item fees are often referred to on processing statements as:
Item Fee
Item Rate
Per Item Rate
Trans Fee
Transaction fee
Transaction fee is charged when you accept your authorization. This fee
only applies to an authorization that is accepted without error

Return Item Fee
A return item fee is charged each time a business issues a refund on a
previously authorized and settle transaction. Return item fees are often
charged in addition to per item fees
Communication Fee
A communication fee is charged each time a business's processing
equipment dials the processor's toll-free phone number to get or give
information. Communication fees are often charged in addition to
authorization and per item fees.
Communication fees are often referred to on processing statements as:
WAT, WATS, POS WATS or GLOBAL WAT
Batch fee
A batch fee (also known as a batch header fee) can be charged to a
merchant whenever the merchant "settles" their terminal. Settling a
terminal, also known as "batching", is when a merchant sends their
completed transactions for the day to their acquiring bank for payment.
Some providers perform this automatically. It is important to close a batch
every 24 hours or a higher rate will be assessed by Visa, Discover or
MasterCard. The term "batch header" originally came from processing pre-
electronic terminal era, when each batch of credit card receipts was turned
into the merchant's local bank for deposit. The batch header was a mini
report summarizing those receipts bundled within.
Address Verification (AVS) Fee
An AVS fee is charged each time a business accesses the address verification
system when processing a card not present transaction. Retail businesses
typically perform AVS when keying in a transaction, and e-commerce
businesses perform AVS on every transaction. For this reason, e-commerce
and card not present businesses must take into consideration that an AVS
fee will be charged in addition to an authorization or per item fee on every
transaction.
AVS fees are often referred to on processing statements as:
AVS, AVS AUTH FEE, AVS AUTH or GLBLEDCAVS

Return Item Fee
A return item fee is charged each time a business issues a refund on a previously authorized and settle transaction. Return item fees are often charged in
addition to per item fees.

Address Verification (AVS) Fee
An AVS fee is charged each time a business accesses the address verification system when processing a card not present transaction. Retail businesses
typically perform AVS when keying in a transaction, and e-commerce businesses perform AVS on every transaction. For this reason, e-commerce and card not
present businesses must take into consideration that an AVS fee will be charged in addition to an authorization or per item fee on every transaction.
AVS fees are often referred to on processing statements as:
AVS, AVS AUTH FEE, AVS AUTH or GLBLEDCAVS
James Lee
M. 917.930.3945
F. 718.661.0014
Ask About
Merchant Services
James Lee M. 917.930.3945

Recurring Fees and other fees
Gateway Fee
A gateway fee is charged each time an e-commerce business passes information to its gateway service provider. Gateway fees are charged in
addition to authorization and per item fees. The gateway fee may also be charged in addition to the AVS fee, although many processors charge
the gateway fee in place of the AVS fee for e-commerce businesses.
Wireless Service Fee
A wireless fee is charged each time a business passes information to its wireless service provider. Wireless service fees are charged in addition
to authorization, per item and AVS fees.

Statement fee
The statement fee is a monthly fee associated with the monthly statement that is sent to the merchant at the end of each monthly processing
cycle. This statement shows how much processing was done by the merchant during the month and what fees were incurred as a result.
Many times, the statement fee is not directly linked to "paper" statements but rather general overhead. This means that a provider would not
waive this fee if a merchant chose to have a "paperless" statement.
Monthly minimum fee
The monthly minimum fee is a way to ensure that merchants pay a minimum amount in fees each month to cover costs from the provider to
maintain the account. If a merchant's fees do not equal or exceed the monthly minimum they will be charged the difference up to the monthly
minimum.
Example: A merchant has signed a contract with a $25.00 monthly minimum fee. If all the fees for the most recent month of processing total
(CLARITY: this is only for processing costs, so it does not include monthly fees, chargeback fees, etc.) only $15.00, this merchant will be charged
an additional $10.00 to meet their monthly minimum requirements. Sometimes there are fees that are charged that are not a part of the
monthly minimum, such as statement fees. It is industry standard to charge a monthly minimum, though not all acquirers charge this, nor do all
that do charge it for every agreement.
Customer Service fee
The customer service fee (also known as a maintenance fee) can be charged by some providers to pay for the cost of customer service. Also
referred to as a "merchant support fee", "customer support fee", or simply, "service fee" by some merchant providers.
Annual fee
The Annual fee can be charged by some providers to pay for costs of maintaining the merchant's account. Sometimes these fees can be
quarterly. The fee can be from $79$399.

PCI Compliance Fee
Annual PCI Compliance Fee
Non PCI Compliance Fee

Chargeback fee
The chargeback is the largest risk that is presented to banks and providers. This is not to be confused with a refund, which is simply a merchant
refunding a transaction. In the Visa, Discover, and MasterCard rules, the merchant's processing bank is 100% responsible for all the transactions
that the merchant performs. This can leave the provider open to millions of dollars of potential losses if the merchant operates in an illegal or
risky manner and generates many chargebacks. The providers pass this cost on to the merchant, but if the merchant is fraudulent or simply
does not have the money, the provider must pay all the costs to make the card holder whole. The chargeback risk is the largest part taken into
consideration during the contract application and underwriting process. Some banks are much more stringent than others when assessing a
merchant's chargeback risk.

Early Termination fee - Cancellation fee
The early termination fee can be charged by some providers if the merchant ends the contract before the end of the contract term. While
contract terms of 13 years are typical, some providers have terms of up to 5 years with a one year prior notice to cancel or the fee will be
assessed. Some providers also assess all statement fees and monthly minimums remaining when the contract is terminated. Some providers
may also assess a "lost profit" fee based on an assumption of profits they concluded they would have earned during the full term of the
contract.

James Lee
M. 917.930.3945
F. 718.661.0014
Ask About
Merchant Services
James Lee M. 917.930.3945

Step Four: Know Three Pricing Elements of Your Processor

1. Interchange Fee
Interchange fee is a term used in the payment card industry to describe a fee paid between banks for the acceptance of card
based transactions. Usually it is a fee that a merchant's bank (the "acquiring bank") pays a customer's bank (the "issuing bank")
however there are instances where the interchange fee is paid from the issuer to acquirer, often called reverse interchange.
In a credit card or debit card transaction, the card-issuing bank in a payment transaction deducts the interchange fee from the
amount it pays the acquiring bank that handles a credit or debit card transaction for a merchant. The acquiring bank then pays
the merchant the amount of the transaction minus both the interchange fee and an additional, usually smaller, fee for the
acquiring bank or ISO, which is often referred to as a discount rate, an add-on rate, or pass-thru. For cash withdrawal
transactions at ATMs, however, the fees are paid by the card-issuing bank to the acquiring bank (for the maintenance of the
machine).
These fees are set by the credit card networks, and are the largest component of the various fees that most merchants pay for
the privilege of accepting credit cards, representing 70% to 90% of these fees by some estimates, although larger merchants
typically pay less as a percentage. Interchange fees have a complex pricing structure, which is based on the card brand, regions
or jurisdictions, the type of credit or debit card, the type and size of the accepting merchant, and the type of transaction (e.g.
online, in-store, phone order, whether the card is present for the transaction, etc.). Further complicating the rate schedules,
interchange fees are typically a flat fee plus a percentage of the total purchase price (including taxes). In the United States, the
fee averages approximately 2% of transaction value.
[

The file link below contains tables that set forth the interchange reimbursement fees applied on Visa financial transactions
completed within the 50 United States and the District of Columbia.
Visa uses interchange reimbursement fees as transfer fees between financial institutions to balance and grow the payment
system for the benefit of all participants. Merchants do not pay interchange reimbursement fees; merchants pay merchant
discount to their financial institution. This is an important distinction, because merchants buy a variety of processing services
from financial institutions; all of these services may be included in their merchant discount rate, which is typically a percentage
rate per transaction.

Visa U.S.A. Interchange Reimbursement Fees April 2013 (PDF, 106 KB)
Interlink Interchange Reimbursement Fees April 2013 (PDF, 45 KB)

2. Dues/Assessments and Direct Fees to Card Brands
Also called acquirer brand volume fees (ABVF), these are imposed by card brands to cover operating costs and are determined
by the purchase price of a product or service. Currently Visas assessment fee is .0925 percent (but will increase to .11 percent
on July 1, 2010), MasterCards is .11 percent, and Discover Networks is .0925.

3. Processing and Service Fees
Authorizing and/or settling credit/debit/prepaid cards and routing money and data to complete transactions incur this fee.
Charges vary among processors, and often what may appear to be a good deal is not. Your quote may be based on a low rate
for a specific kind of transaction, yet neglect to point out that only a small percentage of your transactions actually qualify for
that low rate. The remaining transactions are charged at a fee that could be as much as double or triple that low rate. Know
what you are paying to your card processor above what is being paid to the issuing bank and card brands. Recognizing these
interchange markups and avoiding them is critical to your profitability.

James Lee
M. 917.930.3945
F. 718.661.0014
Ask About
Merchant Services
James Lee M. 917.930.3945

Q5: Which Processing Pricing Models Would be the best for you?

There are several pricing models that processors use to charge merchants for
their payment processing service
You should know which pricing model is better for you and at first, which one
will be applied for your processing when you apply new payment services.
Because the actual your charge will be totally deferent between those models.
Every processor creates their one pricing model in deferent way to bill you for
the services
But bellow 3models are most common type of pricing model. By understanding
these 3 pricing models, you will be able to determine whether you have a great
pricing or worse one by your self.
Enhanced Bill-Back
Enhanced Bill-Back is another deceitful pricing model used in the merchant
service industry.
It has some variations but the basic concept is that the merchant pays one set
rate for qualified cards then is billed back for mid or non qualified cards.
Merchants will be charged the qualified rate for all of their transactions. Then,
for the transactions that are mid or non qualified, you will be charged again for
the difference of the qualified rate (the rate they gave you) and the
interchange rate(cost) plus a surcharge. There are two reasons this is called bill
back. You are billed one rate and then billed back another. Also because you
will typically see the surcharges on the next month's statement. It requires a
great deal of time to research the actual cost per transaction with the bill back
system.

Example of BILLBACK/ERR: Bill Back pricing: 1.79% + 0.50% surcharge-buy rate
difference + enhanced bill back surcharge-surcharge for down grade (0.99%-
1.39%: whatever fee agreement made)
Your account was set up to use Enhanced Bill-Back and your rate to be 1.79%
+ $0.20/item as Card Present Application such as Retail, Restaurant & In-store
business. It means credit your processors buys at interchange rate at
1.39%+$0.10/item and sell you at the rate of 1.79%+$0.10/item)
If you ran $1000 and you keyed in a regular credit card this pricing model at
1.79% + $0.20/item (processors buy at interchange rate at 1.39%+$0.10/item
and sold you at the rate of 1.79%+$0.10/item), that is not considered as
qualified because you did not swipe it. So extra-surcharge will be applied. this
sales Interchange for a keyed credit card is 1.8%. The difference of the
interchange plus the surcharge is 0.55%. Below is how it would look on your
bill.
$1000 X 1.79%= $17.90 Base rate
$1000 X 0.50%= $5.00 The deference between Key transaction rate(1.89%) and
card swipe rate (1.39%)
$1000 x 0.99%-1.39%)=$9.90 - $13.90 enhanced bill back surcharge-downgrade
TOTAL= $(17.70+5+9.90 up to 13.80)+$0.20 item fee

This merchant thanks he has a flat rate transaction fee on all sales at the time
they are accepted as payment, and then billed again at the end of the month
for all rewards, business, and corporate cards. Lets say for the sake of
example the flat rate is 1.99%. The merchant thinks, Well, 1.99% sounds
pretty good OK, Ill take it, however at the end of the month additional
surcharges are levied for all non debit card charges that the merchant
accepts. These additional monthly charges are usually listed in separate
sections of the statement to appear as if the merchant is being charged
the promised 1.99%. In reality, there may be an additional charge of 2% or
more.
One last component of Enhanced Billback is that the flat rate of 1.79% plus
$0.20 in the above example is often taken out of the merchants daily batch
total. For example, if you had $1,000 in one sales item and then batched out at
days end, only $981 would be deposited into your account. Then when you are
billed at the end of the month for all the surcharges, it will appear as if those
were the only fees for the month, as the rate of 1.79% plus $0.20 is often
disguised on the monthly statement.
There are other variations of these pricing models that are utilized. They are
almost always aimed at confusing or complicating the process to hide the fact
that the merchant is paying more than they were initially led to believe. Weve
seen hundreds of examples of different statements from dozens of different
credit card processors and we know how to cut through the noise and
determine exactly what you are being charged.
As you study, Enhanced bill back pricing model is most profitable to processor
so that they offer this model to most of small business to obtain their revenue
thru surcharges which is the major part of hidden fee.
Step Five: Know What is best type of
processing pricing Models for you

There are several pricing models that processors use to charge merchants for their payment processing service
You should know which pricing model is better for you and at first, which one will be applied for your processing when you
apply new payment services. Because the actual your charge will be totally deferent between those models.
Every processor creates their one pricing model in deferent way to bill you for the services
But bellow 3models are most common type of pricing model. By understanding these 3 pricing models, you will be able to
determine whether you have a great pricing or worse one by your self.

Enhanced Bill-Back Pricing Model

Enhanced Bill-Back is another deceitful pricing model used in the merchant service industry.
It has some variations but the basic concept is that the merchant pays one set rate for qualified cards then is billed back for mid
or non qualified cards. Merchants will be charged the qualified rate for all of their transactions. Then, for the transactions that
are mid or non qualified, you will be charged again for the difference of the qualified rate (the rate they gave you) and the
interchange rate(cost) plus a surcharge. There are two reasons this is called bill back. You are billed one rate and then billed back
another. Also because you will typically see the surcharges on the next month's statement. It requires a great deal of time to
research the actual cost per transaction with the bill back system.

Example of BILLBACK/ERR:

If Your account was set up to use Enhanced Bill-Back and agree your discount rate (best rate) 1.79% + $0.20/item as
Card Present Application such as Retail, Restaurant & In-store business.
It means credit your processors buys at interchange rate at 1.49%+$0.10/item and sell you at the rate of
1.79%+$0.10/item)

If you ran $1000 and you keyed in a regular credit card this pricing model at 1.79% + $0.20/item that is not considered
as qualified because you did not swipe it. So extra-surcharge will be applied. this sales Interchange for a keyed credit
card is 1.89%. The difference of the interchange plus the surcharge is 0.40% - your processors buys at interchange rate
at 1.49%+$0.10/item and sell you at the rate of 1.79%+$0.10/item)

Below is how it would look on your bill.
$1000 X 1.79%= $17.90 Base rate
$1000 X 0.40%= $5.00 The deference between Key transaction rate(1.89%) and card swipe rate (1.49%)
$1000 x 0.99%-1.39%)=$9.90 - $13.90 enhanced bill back surcharge-downgrade
TOTAL= $17.90+$5+ ($9.90 up to $13.90)+$0.20 item fee

Actual your services fee for this transaction: 1.79% + 0.40% surcharge-buy rate difference + enhanced bill back
surcharge-surcharge for down grade (0.99%-1.39%: whatever fee agreement made)

Please take a look at Fee Processing Flowchart Example of Enhanced Bill-Back Pricing Model at next pages
James Lee
M. 917.930.3945
F. 718.661.0014
Ask About
Merchant Services
James Lee M. 917.930.3945

This Flowchart explains why the actual bill is higher than merchants think.
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The surcharge Rate
. The Master Card Best Rate that is the rate you agreed to pay for
the master card sales to your processor for qualified sales. Such as
1.79%+$0.20

This chart shows 5 of requirement to qualify for best rate that
allows master card sales transaction is qualified for best rate
Such as 1.79%+$0.20 without surcharge because no
downgrade occurs.

If this sales transaction did not meet the 5 of requirement, it
will be applied surcharges. At the Example Case, Key entry
surcharge 0.40% was applied.

Also it shows how much surcharge occurs when it downgraded
and why it is downgraded.

Most of Merchants are looking for lowest rate and applies to who gave
the lowest rate. Because most of merchants thinks the low rate is
equal to the low fee.
But , above this fee, merchant realized there are many of the
additional fees and merchants wonder why? But no one tell you
why clearly.

Normally, the big portion of card sales does not meet these
requirement and get the downgrade. This means the additional fees -
billback surcharge is occurred. It cause merchant pays more as additional
surcharge for the portion of downgraded card sales at the top of
qualified sales fee.
Fee Processing Flowchart Example of
Enhanced Bill-Back Pricing Model
Key Entered
.40%
Step Five: Know What is best type of processing pricing Models for you / Learn about Enhanced Bill-Back Pricing Model Continued
MasterCard Downgrades-Basic Surcharges
Form Merit III to .. Downgrade Amount
Key Entered 0.40%
Merit I 0.50%
Corporate T & E Rate 0.90% - $.10
Corporate T & E Rate II 0.70%
Standard 1.25%
Corporate Standard 1.25%
T & E Rate III 0.60%
World Card 0.80%
*Note: These Amounts is basic surcharge and it do not
included any Enhanced Billbacks. - Extra penalty type
surcharge-surcharge for down grade (0.99%-1.39%)
whatever fee agreement made)

James Lee
M. 917.930.3945
F. 718.661.0014
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Merchant Services
James Lee M. 917.930.3945

Services Fee Processing Chart for Restaurant-MasterCard Sales
Surcharge amount here is not accurate. It was base on
old version of MasterCard interchange rate and create to
show you how it works
James Lee
M. 917.930.3945
F. 718.661.0014
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Merchant Services
James Lee M. 917.930.3945

This merchant thinks he has a flat rate transaction fee on all sales at the time they are accepted as payment, and then billed again
at the end of the month for all rewards, business, and corporate cards. Lets say for the sake of example the flat rate is 1.99%. The
merchant thinks, Well, 1.99% sounds pretty good OK, Ill take it, however at the end of the month additional surcharges are
levied for all non debit card charges that the merchant accepts. These additional monthly charges are usually listed in separate
sections of the statement to appear as if the merchant is being charged the promised 1.99%. In reality, there may be an additional
charge of 2% or more.
One last component of Enhanced Billback is that the flat rate of 1.79% plus $0.20 in the above example is often taken out of the
merchants daily batch total. For example, if you had $1,000 in one sales item and then batched out at days end, only $981 would
be deposited into your account. Then when you are billed at the end of the month for all the surcharges, it will appear as if those
were the only fees for the month, as the rate of 1.79% plus $0.20 is often disguised on the monthly statement.
There are other variations of these pricing models that are utilized. They are almost always aimed at confusing or complicating the
process to hide the fact that the merchant is paying more than they were initially led to believe. Weve seen hundreds of examples
of different statements from dozens of different credit card processors and we know how to cut through the noise and determine
exactly what you are being charged.

As you study, Enhanced bill back pricing model is most profitable to processor so that they offer this model to most of small
business to obtain their revenue thru surcharges which is the major part of hidden fee.
Surcharge amount here is not accurate. It was base on old version of MasterCard
interchange rate and create to show you how it works
James Lee M. 917.930.3945
F.718.661.0014 AplusMerchants@gmail.com
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Consultation
James Lee
M. 917.930.3945
F. 718.661.0014

Tiered Pricing Models
There are about 400 different rates that a merchant can be charged on an individual transaction. This is based on the card brand,
card type, card present status and amount of security information obtained at the time of use. The card processors have an
Interchange rate or cost for each different rate and add their profit to determine your cost.
The tiered pricing model takes the whole matrix of Interchange and boils it down to usually three or four categories. Those
categories are generally called qualified, mid-qual, and non-qual, and sometimes there is an additional category for debit
transactions. If you see those terms on your monthly statement, then you know you are being charged based on a tiered pricing
model. . A possible drawback from the merchant's perspective, is that these "tiers" or "buckets" are variable from one processor to
the next prohibiting any direct comparison from a Tier 1 provided by one provider to a Tier 1 provided by another provider.

3-Tier Pricing
The 3-Tier Pricing is the most popular pricing method and the simplest system for most merchants to understand, if not the most
transparent. The newer 6-Tier Pricing, including additional tiers covering debit, business, or international cards is gaining in
popularity. In 3-Tier Pricing, the merchant account provider groups the transactions into 3 groups (tiers) and assigns a rate to each
tier based on a criterion established for each tier
First Tier - Qualified Rate
A qualified rate is the percentage rate a merchant will be charged whenever they accept a regular consumer credit card and process
it in a manner defined as "standard" by their merchant account provider using an approved credit card processing solution. This is
usually the lowest rate a merchant will incur when accepting a credit card. The qualified rate is also the rate commonly quoted to a
merchant when they inquire about pricing. The qualified rate is created based on the way a merchant will be accepting a majority of
their credit cards. For example, for an internet merchant, the internet interchange categories will be defined as Qualified, while for
a physical retailer only transactions swiped through or read by their terminal in an ordinary manner will be defined as Qualified.
Second Tier - Mid-qualified Rate
Also known as a partially qualified rate, the mid-qualified rate is the percentage rate a merchant will be charged whenever they
accept a credit card that does not qualify for the lowest rate (the qualified rate). This may happen for several reasons such as:
A consumer credit card is keyed into a credit card terminal instead of being swiped
A special kind of credit card is used like a rewards card or business card
A mid-qualified rate is higher than a qualified rate. Some of the transactions that are usually grouped into the Mid-Qualified Tier can
cost the provider more in interchange costs, so the merchant account providers do make a markup on these rates.
The use of "rewards cards" can be as high as 40% of transactions. So it is important that the financial impact of this fee be
understood.
Third Tier - Non-qualified Rate
The non-qualified rate is usually the highest percentage rate a merchant will be charged whenever they accept a credit card. In most
cases all transactions that are not qualified or mid-qualified will fall to this rate. This may happen for several reasons such as:
A consumer credit card is keyed into a credit card terminal instead of being swiped and address verification is not performed
A special kind of credit card is used like a business card and all required fields are not entered
A merchant does not settle their daily batch within the allotted time frame, usually past 48 hours from time of authorization.
A non-qualified rate can be significantly higher than a qualified rate and can cost the provider much more in interchange costs, so
the merchant account providers do make a markup on these rates.

6-Tier Pricing
As a result of the Wal-Mart Settlement and to compete against PIN-based debit cards (which are processed outside of the Visa and
MasterCard networks), Visa and MasterCard lowered the interchange rates for debit cards well below those for credit cards. Some
providers can pass on the lower cost of these cards directly to merchants. Consequently, the 3 tiers programs have added 2
classifications for debit cards that are processed without a PIN or with a PIN for a total of 6 rate classifications.
Step Five: Know What is best type of processing pricing Models for you / Tiered Pricing Models
James Lee
M. 917.930.3945
F. 718.661.0014
Ask About
Merchant Services
James Lee M. 917.930.3945

Tiered Pricing Model Review:
Better Than Enhanced Bill-back But The Problem With Tiered Pricing

The concept of tiered pricing models are not inherently bad and most of case better than
Enhanced Bill-Back, as it attempts to take a rather complex matrix and simplify it greatly.

The problem lies with how processors utilize tiered pricing. The main problems are continual
rate increases and the processor only shows what you are being charged, without disclosing
true cost from processor profit.

A tiered model will always set the tiered price so that it is higher than the actual cost of the
most expensive card type allowed within that tier. In other words, there are many card types
that fall under the mid-qual tier with interchange rates that range from 1.65%-
1.74%. Processors often set the price of that tier between 2.25% and 3.25%, plus an additional
$0.20-$0.35 per transaction.

Case Study
One sneaky tactic that many sales agents use is to set a qualified rate that is lower than
interchange. These agents and their processors might set a qualified rate as low as 1% and then
do their best to convince the merchant that this is the rate they will see for all their
transactions. In reality, depending on the business and their industry, the merchant may have
only a few, if any, of their total transactions fall into that qualified category. The remaining
transactions fall into the mid- and non-qual categories, which are priced at a significant mark-up
over Interchange. When the deception is brought to the merchants attention, they often face a
hefty cancellation fee to get away from that processor. We see this time and again at the free
consultation with us, but thankfully the savings we generate with our approach more than
offsets the costs of cancellation.

The Best Option With Tiered Pricing Model
Special Tiered Pricing could work very well - designed to fit your unique business through a
reliable payment processing consultant like James Lee 18 years payment industry expert with
considering all of pricing factors making you fees different.
Step Five: Know What is best type of processing pricing Models for you / Tiered Pricing Models
James Lee
M. 917.930.3945
F. 718.661.0014
Ask About
Merchant Services
James Lee M. 917.930.3945

Interchange Plus Pricing
There is only one approach that you should ever accept in your business and that is Interchange plus pricing, which
represents the true cost set by Visa and MasterCard.

Most of processors allows to offer Interchange Plus Pricing to large sales volume merchants only because this pricing
model is less profitable than other type of pricing models.

Some providers offer merchant account services priced on an "interchange plus" basis even if small card volume merchants..
These accounts are based on the "interchange" tables published by both Visa Interchange and MasterCard Interchange. This
type of pricing creates a discount rate by adding interchange rates plus a percentage and authorization fees. This is a
common pricing model for very low and very high average tickets.

Why interchange pricing model is the best for your business?

Aren't you sick and tied with your surcharges that eats your profits every single sales?
Surcharges, bill-backs, and tiers are often inexplicable and are potentially pure expense with no value.
Interchange is a large matrix of rates set by Visa and MasterCard that is associated with each and every credit card type in
circulation. These rates are charged as a percentage against the total sale as well as a flat fee per transaction. Additionally,
the Interchange rate differs for each specific card type depending upon if it is swiped or keyed in. The image above is an
excerpt of the multi-page Interchange chart for Visa as of October 2011 (Interchange updates every April and
October). Interchange represents the true cost of a merchant accepting a credit card as payment.

For one example of how interchange functions, imagine a consumer
making a $100 purchase with a credit card. For that $100 item, the
retailer would get approximately $98. The remaining $2, known as the
merchant discount and fees, gets divided up. About $1.75 would go to
the card issuing bank (defined as interchange), $0.18 would go to Visa
or MasterCard association (defined as assessments), and the remaining
$0.07 would go to the retailer's merchant account provider. If a credit
card displays a Visa logo, Visa will get the $0.18, likewise with
MasterCard. Visa's assessment is fixed at 0.1100% of the transaction
value and MasterCard's assessment is fixed at 0.0950% of the
transaction value. On average the interchange rates in the US are 179
basis points (1.79%) and vary widely across countries. In April 2007 Visa
announced it would raise its rate .6% to 1.77%.
Interchange pass thru is Best Pricing Model but The problem remained
As you learned, Interchange pass thru is better than any other pricing models but the problem on
Interchange Plus Pricing is:
"there are many other processors create the tricky way to add up surcharges.
Many of them increase the portion of their services fees Never Locked
At Next Page, You will learn how to resolve it!
James Lee M. 917.930.3945
F.718.661.0014 AplusMerchants@gmail.com
Sign up for
Consultation
James Lee
M. 917.930.3945
F. 718.661.0014
Step Six: Know Who can bring the best profits
Here Is The Key Benefits Overview On Your Processing Cost With Clearents Pricing.
Real Interchange plus pricing -No hidden fees, No middlemen, No surprises on your
processing fees
We give you the clearest, most detailed statement in the industry so You can make sure Clearent
delivers real true interchange pass thru. There is no way around that if processor provides your clear
statement showing each transaction detail like Clearent. Clearent's reporting system called Compass
shows clean detail of transaction and fee description how to be applied on each sales transaction.

No hidden fees - Clearent delivers real true interchange pass thru. No hidden fees without
trick at all.. So youll know the true cost of every card that comes through your business with full
disclosure into how much youre paying us and how much goes to the card brands. Plus, we pass
through any interchange reductions or increases that may occur. So there are no surprises.

No Sales Volume Restriction - Clearent delivers True wholesale pricing for any size
merchant without higher volume of card sales requirement to be applied by interchange pricing
model such as over Million dollar card sales merchant only.

3 Year Price Guarantee - you do not need to worry about your fee increasing because we
give you 3 Year Price Guarantee - no price increases every April & October like other processors

Competitive Rate & Pricing Skip the middleman and avoid unnecessary, costly fees by
working with a direct processor for Visa
, MasterCard
, and Discover
. We offer you the industrys

most competitive rate

Free PCI - Absolutely no fees for merchants who complete our free PCI questionnaire

Free to Go No Early Termination fee will by applied with Written Notice. If you dont want
to be locked into a contract, look for a company that allows you to cancel at anytime like Clearent.

You are sick and tired of hidden surcharges eating
your profits every single sales, are you?
Clearent is the key to stop your loss and help your
business more profitable.
James Lee
M. 917.930.3945
F. 718.661.0014
Ask About
Merchant Services
James Lee M. 917.930.3945

Sign up For free consultation,
Contact James Lee at 917-930-3945
You are sick and tired of hidden surcharges eating your profits every single
sales, are you? We will stop your loss and help your business more profitable.
Turning to Clearent,
Your Benefits On Processing Never End..
Easy to Switch Paying your cancellation fee with Cost-free
Application. Free to Go No Early Termination fee will by applied
with Written Notice
Call James Lee
1. 917.930.3945
AplusMerchants@gmail.com
Advance Your Business
With James Lee At Clearent
YOUR GREAT ADVANTAGES WITH US
Perfect Processing Solution Fit Your
Business
Reduce Your Overall Cost More Than 25% Less
Increase Your Sales And Your Business Safety.
More Than 25% Of Average Cost
Reduction On Payment Processing
3 Year Price Guarantee - no price increases
every April & October like other processors
Competitive Pricing Skip the
middleman and avoid unnecessary,
costly fees by working with a direct
processor for Visa
, MasterCard
, and
Discover
.
Competitive rates - Our rates are
among the industrys most
competitive
No hidden fees - We give you the
clearest, most detailed statement in
the industry
Free PCI - Absolutely no fees for
merchants who complete our free PCI
questionnaire
Know Who can bring the best profits
Ask About
Merchant Services
James Lee M. 917.930.3945

Sign Up For Free Consultation! The Sooner, The More Profits!
James Lee Free & Reliable
Payment Processing Consultation
If You have any issue on your payment processing,
Ask James Lee for the best solution then With his18 years
payment processing industry expertise,
He will help you have the instant solution with The great benefits
you never expected.
See What A Consulting Make Your Business Deferent!
Through Better Services Plan With Best Payment Processor Such As
Clearent,
A Consultation With James Lee Help Achieve Faster Growth And Faster
Profits Such AS:
To have the perfect payment solutions fit your unique business needs.
To prevent your damages from the bad choice for the processing services provider,
equipment's and service plane: etc
To Stop your loss profits on hidden surcharges on payment processing service
fee.
To protect your business from the damages from the failing of payment
processing mandatory such as PCI Compliance and avoid IRS Backup
withholding your card sales settlement at a rate of 28%
Learn More, Visit: http://b2breferral.wix.com/home
Ask About
Merchant Services
James Lee M. 917.930.3945

Ever wonder what sets one processor apart from all the others in such a crowded field? Well, wonder no more. When you
get help from James Lee for all your processing needs, youll discover that a unique experience, with a new revolution on
your payment processing powering the best benefits such as:
A Complete Payment Solutions- Tailed to Your Business Needs. we enable your business to make the sale -
grow your sales with every payments anywhere, anytime
Regulatory Compliance Assistance protecting your business such as PCI Security Compliance
Program and Regulatory reporting program
Reducing Your Credit Card Processing Costs
Competitive Pricing Skip the middleman and avoid
unnecessary, costly fees by working with a direct processor
for Visa
, MasterCard
, and Discover
.
Competitive rates - Our rates are among the industrys
most competitive
No hidden fees - We give you the clearest, most
detailed statement in the industry
Free PCI - Absolutely no fees for merchants who complete
our free PCI questionnaire
3 Year Price Guarantee - no price increases every April & October like other processors
No cancellation fee with 45 day written notice
U You can sign up for our service with no obligation or risk, and youre not locked into a long-term contract. You can
cancel your service at any time, for any reason, with no penalties or early termination fees when you give us a 45 day written
notice
Next day funding including weekend- get your money the next business day including getting your
weekend batches on Monday morning when you batch before 10:00PM CST with Express Funding
Superior Customer support - Our friendly, responsive customer support experts are ready for you 24/7/365
U Daily updates - Easy, stress-free reconciling with online reporting thats updated daily
Seamless POS Integration- Despite what you may have been told, not all POS systems are proprietary to
one merchant processor. We can seamlessly integrate with these POS systems and more:

Why Sign Up A Free Merchant Services Consultation?
See How A Consultation makes your business different.
Ask About
Merchant Services
James Lee M. 917.930.3945

A Different Kind of Processor
In stark contrast to processors that offer rigid systems built on outdated technology, spotty
customer service and high PCI fees, we deliver interchange plus pricing which is
wholesale pricing that identifies the true cost of every card that comes through your door.
Aldelo Systems
Aloha
Comtrex
Datacap Systems
Supermenu POS
Halo
Harbortouch
Ingenico
MICROS
Digital Dining
Dinerware
Focus
Future POS
NCR
POS Lavu
POSitouch
QuickBooks
Restaurant Manager
ShopKeep
SilverWare
Squirrel Systems
A Complete Payment Solution
Products and Services Tailed to Your Business Needs
James Lee helps US merchants eliminate barriers to success so you can win the day. His customers satisfaction
on the unique combination of value pricing and excellent Assistance have put him on the fast track
for growth and helped him be able to set up more than 5,000 local merchants by himself
A COMPLITE CARD ACCEPTANCE
CREDIT
Fast and easy acceptance of Visa,
MasterCard, American Express, and
Discover cards is the mark of a strong merchant
services provider, as is quick, no-hassle
settlement. Clearent delivers both!.
SINATURE OR PIN-SECURED DEBIT
A rapidly growing payment option for consumers,
debit cards can reduce your processing costs. With
Clearent, you can accept PIN-based debit cards
from all of the major debit networks
EBT - Cut down food stamp processing time and eliminate
potential fraud with our Electronic Benefits Transfer service.
Your customers have full access to their funds and we help you
to examine eligibility and determine the solution that best suits
your business!
CHECKS - We offer a wide array of electronic check
and ACH services, including check conversion,
guarantee, remote deposit capture and ACH debit. No
cash? No problem!
A COMPLETE VALUE ADDED
PROGRAM
GIFT CARDS AND LOYALTY CARDS
Begin selling your own gift cards or launch a
customizable, card-based customer loyalty program in
as little as two weeks. Real-time, online reporting makes
managing your program a breeze.
Gift card spend can result in up to a 50% higher average
ticket. With 9-out-of-10 people purchasing or receiving at
least one card in the last 12 months, consumer demand
has expanded prepaid well beyond retail.
Loyalty Card Program which allows you to easily (and
frequently) create and track promotions to incent
repeat business and reward your best customers.
Double points, buy-10-get-1-free, whatever you have in
mind...its automatically managed through your credit card
terminal.
ATM Services
Cash Advance Products-helping you have the
Lowest Interest Rate with variety of payback option
at the top of fast approval from $50,000 up to $1MM
THE PERFECT SOLUTION
FITS YOUR BUSINESS
IN STORE
Switch to high-speed processing to potentially save
money on every transaction. Add a PIN-pad for additional
savings on larger purchases. Use your existing
equipment or your Clearent Account Executive, James
Lee can recommend the right terminal for your business.
ONLINE OR OVER THE PHONE
Securely sell online or take payments over the phone.
Login to the Virtual Terminal to accept payments through
your computer. Add a mag-stripe reader to secure more
favorable card-present rates.
ON YOUR WEB STORE -Accept payments on
your web store with e commerce credit card
processingfrom CLEARENT. The fast, safe, and secure
way to run your business
ON THE WAY
Wireless terminals and cellphone applications mean
youre free to accept payments practically anywhere.
Flexible Point-of-Sales Solution:
Terminals, virtual terminals, payment gateway, POS Software, wireless, mobile and IVR/touchtone.... We make integration easy by offering POS software for brick-and-
mortar retail ... Wireless connectivity makes mobile commerce (m-commerce) possible. ... Mobile Phones ... service turns your touch-tone phone or cell
phone into a robust POS device. We can seamlessly integrate with these POS systems and more: Digital Dining, Future POS, MICROS, Comtrax, Aloha, Harbortouch, POS Lavu,
POSitouch, Supermenu POS, NCR, Ingenico, Aldelo Systems, Squirrel Systems, Datacap Systems, Dinerware, SilverWare, Restaurant Manager, Halo, Focus, ShopKeep, QuickBooks
Recurring Payments - Automate the management and collection of scheduled payments. Set up daily, weekly or monthly plans that charge your customers credit card or
checking account
Clearent customers also have 24/7 access to a toll-free Automated Voice System (AVS) to secure a credit card authorization
Ask About
Merchant Services
James Lee M. 917.930.3945

?
You are sick and tired of hidden surcharges eating your profits every single sales, are you? You do not have to
stay on it. We will show you how to stop your loss and help your business more profitable when we talk together.
Time is money. The more delaying , The more loss of your profits.

Sign Up Free Consultation
To learn more how our payment and credit card services can help control your cost while providing safe,
convenient payment transactions for your business.
You will discover how to maximize your benefits on your payment processing with Clearent-The real best
value provider

Sign Up Free Consultation
It helps protect yourself while accepting credit cards for your business and to have the best
pricing on your payment processing.

Just call James Lee - your reliable payment processing consultant at 917-930-3945
For the best result, email to AplusMerchants@gmail.com or fax us (718-661-0014) two consecutive
processing statements and well give you an honest comparison with best pricing for you.
These copies were created by James Lee and opinions expressed here are the personal opinions of James Lee, an account execut ive of Clearent. Content published
here is not monitored or approved by Clearent before it is posted and does not necessarily represent the views and opinions of Clearent.
Ask About
Merchant Services
James Lee M. 917.930.3945

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