How does the Cash Discount Program Work?
How can GPT save you Money on Credit Card Processing Fees?
Simply stated, credit card processing fees are the fees that a business pays to accept credit cards as a form of payment. There are actually multiple types of fees associated with credit card transactions. They include:
- Interchange Fees: these are the fees charged by the issuing card provider and its sponsoring bank to the merchant who processes the card. These fees are calculated as a percentage of the total amount on approved credit card transactions. For traditional processors, this fee ranges from 1.85% - 4% of each receipt. With GPT, the business owner pays as low as 0% on interchange fees. (Business owners who allow customers to write in tips after the receipt is generated may pay a small portion of the interchange fee. This is called Tip Adjust. The way to avoid this is to allow customers to determine their tip before printing the receipt, which can be programmed into your card processing machines or POS systems.)
- Transaction and Authorization Fees: these fees are typically 5-35 cents on every transaction. Some processors charge you to run an authorization check regardless of whether the transaction is approved or declined. Some companies only charge for approved authorizations and cover the declined authorizations within miscellaneous fees. GPT does not charge our merchants transaction or authorization fees.
- Statement Fee: this is a fees that you are charged for your processor to provide a monthly statement of your transactions. Traditional processors may charge between $5-$10 monthly to provide you with a statement. There is no statement fee when you use GPT as your provider.
- IRS TIN Fee: Internal Revenue Code 6050W requires that merchant processors annually report all payments in settlement of card payment transactions to the IRS for all merchants. They also require backup withholding to be deducted if the merchant refuses to provide the correct TIN for their business. For purposes of the expense involved in tax reporting and providing an annual 1099-K to merchants, most service providers charge a fee of $4.95-$11.95 per month (upwards of that for missing and incorrect tax identification numbers.) GPT does not charge an IRS TIN fee.
- Monthly Minimum: this is a fee that is assessed if a merchant does not reach a certain volume of credit card transactions. This fee is assessed because it costs the service provider money to maintain the account, and if a minimum is not reached, the account would cause a monthly loss for the service provider. Most service providers charge a fee of $25-$50 monthly when volume minimums are not met. The monthly minimum for GPT is $35 per month.
- PCI Annual Compliance Fee: There are laws in place to protect both consumers and business owners with fair business practices and fair payment practices. Merchant service providers are required to prove that they are in compliance on a regular basis and additionally prove compliance whenever a complaint is made and presented. This ensures that the independent business owner does not have to respond directly to any compliance complaints; they are all taken care of by the legal team of the merchant service provider. Our team currently has a perfect compliance record. We are in full compliance with all related laws regarding merchant service processing and the cash discount program way of processing credit and debit cards. The annual fee for PCI Compliance with GPT is $159.
- Express Funding Fee: this is the fee you pay to be able to receive the money from your transactions by the next business day. Traditional processors charge $9.99 - $19.99 per month for express funding. Newer mobile apps and big name online providers charge as much as 1-3% of the total of each transfer to make funds available on the next business day. GPT provides next business day funding for no additional fee.
- Other Fees: these fees include gateway fees, address verification services, phone authorization fees, online access fees, and other miscellaneous fees that individual providers determine. Each one of these fees are monthly anywhere between $1.99 to $199.99 every month. It is important to be very careful to be clear about all fees that you will be charged by whichever merchant services provider you choose. Besides the $35 per month and $159 annual compliance fee, GPT charges no additional fees to our merchants.