All retailers accepting debit and credit cards are painfully aware that the charges incurred each month by the business can be quite significant. Even if the actual costs per individual transaction may appear quite manageable, the amount paid over to credit card companies for the service is a cost of doing business that needs careful monitoring.
There are two primary types of payments, credit and debit. While we use the word credit Card and Debit card, technology has overtaken the plastic card with payments by phones and watches increasingly popular for effecting payment transactions.
While all of these types of payment incur the same cost to the retailer, there is a world of a difference between a personal card and a commercial card when it comes to fees charged.
Take out you most recent statement from your card processor, identify the level of sales you incur from commercial card holders for purchasing the exact same products that the customer using a personal card makes. It is hard to imagine how it improves your business to have a two-tier structure in place.
We find it interesting that Revenue (here) have issued an instruction to those charged with accepting payments that they should decline to accept commercial cards as settlements of tax owed!
We will make further enquiries from industry sources on whether such a refusal is permissible under the Rules issued to all Merchants.
The reason that retailers are at a disadvantage is that when a phone or watch is offered for payment, we cannot see what type of “card” is being used by the customer and cannot, if we were so inclined, seek an alternative, less expensive payment type. There are few exceptions to the card acceptance Rules that would allow a retailer to charge a surcharge either.
We will bring further information on how to identify opportunities to reduce your credit and debit card acceptance bills over the next few weeks.
