Business Owners: who do you lease your credit card terminals from? Update post #25

[weHEARTmickey]

DH owns three seasonal plant nurseries & we are only open 3 months out of the year. So, we need 3 wireless CC terminals + service for 90 days or less. Who do you use?

We were with Sam's/First Data, but aren't anymore. They agreed to 90 day lease contracts for all three locations, then kept debiting lease charges out of our account after our lease fulfillment (over $3000 worth.) We had to close out our longtime business checking acct & open a new one. Just wondering who you recommend & why. Thanks

 

[Free4Life11]

How about this: https://squareup.com/

 

[weHEARTmickey]

Thanks for the help, Free4Life, but I don't think those would work. DH has 2 managers to run the two nurseries that he's not working, so we'd prefer to have wireless credit card terminals. Personally, I wouldn't want to give my CC # to someone who charges it through their cell phone. But, that may be just me. We also like to keep a paper trail of every single transaction.

We use the machines ALL day (around 12 straight hrs) so they need to have a good battery life. First Data leased us FD-400 wireless machines & we never had any trouble with them. Unfortunately, they are proprietary (spelling?) and can only be leased through Sam's Club/First Data. As I mentioned, we're not using them again!

 

[NVDisMom]

It sounds like you need to do 3 seasonal merchant processing accounts and then RENT the wireless terminals for those same three months. Lease are going to be charged every month of the year whether you process or not because you have the equipment in your possession. Or you can purchase the terminals and use them as you need to. This would be where I would ask if you absolutely NEED wireless or if you could use a regular terminal with a land line or even IP, and save yourself some costs. Those things can be expensive! Whoever you go with, remember to call the customer service number when you are done processing for the season and close the account or they will charge you the monthly minimum each and every month even though you aren't processing.

When DH gets home I will show him the thread and he may have more input. He works for First Data's competition

 

[akcire]

Hi OP

I saw the Twitter guy on a PBS business news show a couple of weeks ago talking about his new business.

I don't know if this would work for you, but it looks super cool. My husband has been investigating the rate structure compared with what his company pays now for credit card processing. I haven't followed up with him.

Here is a link to his site.

Like I said--we have not used it--nor do we work for the company. It just looks kinda cool.

https://squareup.com/

 

[NVDisMom]

There is one for the iphone too.

http://www.elavon.com/documents/pdfs/PAYware-Mobile-Solution-Sheet-Final.pdf

 

[mjhd]

I am not a seasonal business, but I use heartland for my cc processing. They are very easy to work with and have great small business rates. As for the terminals, it would should be MUCH more cost effective, especially long term, to purchase the terminals - I bought mine on ebay. Good luck!

 

[drgreene1096]

I use propay.

 

[WheelCEO]

I've been processing my payments through cdgcommerce for the past few years and love them.

 

[weHEARTmickey]

Thanks everyone! We will research your suggestions DH doesn't have an iPhone (doesn't even text!) and prefers actual wireless terminals. We haven't purchased the terminals b/c they become obsolete so quickly. (We purchased them 4 yrs ago & had to EAT the cost. The wireless service wasn't that great & when we tried to use them with another service provider, they said they couldn't use those machines.)

Thank you for all the advice, though! We are getting pretty desperate...nursery season opens in March!!

 

[NVDisMom]

Thanks everyone! We will research your suggestions DH doesn't have an iPhone (doesn't even text!) and prefers actual wireless terminals. We haven't purchased the terminals b/c they become obsolete so quickly. (We purchased them 4 yrs ago & had to EAT the cost. The wireless service wasn't that great & when we tried to use them with another service provider, they said they couldn't use those machines.)

Thank you for all the advice, though! We are getting pretty desperate...nursery season opens in March!!

Just keep in mind you do not want to lease a terminal. You will be paying the lease fee every month. You want to rent and return it at the end of your season every year. Its a hassle and will be more expensive each month, but will probably save money year to year. HTH

 

[weHEARTmickey]

We will use the Verifone VX-610 wireless terminals (we already own one, so we'd rent 2 others.) They are offering a 90 day trial period, so we wouldn't have to commit to the usual 36 or 48 month leases. They will charge $35 one time set up fee (x3 machines); $25 wireless monthly fee (x3 machines); $4.95 monthly service fee (x3 machines); $100 monthly service agreement (x3 machines-even though we own one.)

Most fees are 1.64% Credit Card / 1.3% Debit card / 2.35% Rewards Card + $0.19 per transaction.

We will get monthly statements + online access to our accounts all at no charge.

Are all these fees similar to what you're being charged? Thanks for any help

 

[NVDisMom]

We will use the Verifone VX-610 wireless terminals (we already own one, so we'd rent 2 others.) They are offering a 90 day trial period, so we wouldn't have to commit to the usual 36 or 48 month leases. They will charge $35 one time set up fee (x3 machines); $25 wireless monthly fee (x3 machines); $4.95 monthly service fee (x3 machines); $100 monthly service agreement (x3 machines-even though we own one.)

Most fees are 1.64% Credit Card / 1.3% Debit card / 2.35% Rewards Card + $0.19 per transaction.

We will get monthly statements + online access to our accounts all at no charge.

Are all these fees similar to what you're being charged? Thanks for any help

My automatic questions would be...What happens after the 90 day trial period? Would it then become a lease, a rental, sale, etc? What is it going to cost us after the trial period?The set up fees (pays to program the terminal), wireless monthly fees(access fees similar to cell service) and monthly service fees(for the processor to coordinate it all) for all three machines is normal, but the $100 a month service agreement..what is it for? And why are you paying it on the machine you already own? This sounds like a rental or lease fee for the equipment. Which means you aren't really getting the terminals for free and you certainly shouldn't be paying it on the machine you own. I'd be getting clarification on these fees. As for the processing rates, the rates you list are competitive, but they aren't giving you the entire picture. What are the mid qualification and non qualification rates? Qualified (1.64%) applies to normal consumer cards that are swiped in the machine. Mid Qual applies to rewards cards(ETA-I see they tell you the rewards %, but the non swiped might still be higher) and cards numbers that are not swiped for whatever reason. Non Qual applies to business cards and non swiped transactions that you do not get address verification for. Depending on how many rewards cards and business cards you accept you could be paying that rate more often that the Qualified. Ask Chase what your card spread is. They should be able to tell you from last year's statements. Keep in mind Visa/Mastercard determines how a card qualifies and has a long list of individual rates. The processor is lumping them together into tiered rates to simplify things for the sales pitch. Also...what is their monthly minimum? Do they charge batch fees? Statement fee? Annual fee? Application fee? And don't forget to ask about PCI compliance and fees for the annual compliance and possibly a monthly fee if you don't comply. I know its a lot, but if you cover all of those bases you shouldn't have any surprises! HTH

 

[weHEARTmickey]

Thank you for all these questions for me to ask!!

My automatic questions would be...What happens after the 90 day trial period? Then I am to be released from the 90-day contract. Believe me, this is a BIG ONE for us since First Data stole from our acct even though we had contractual proof that we canceled w/in the 90 day trial. Would it then become a lease, a rental, sale, etc? What is it going to cost us after the trial period?The set up fees (pays to program the terminal), wireless monthly fees(access fees similar to cell service) and monthly service fees(for the processor to coordinate it all) for all three machines is normal, but the $100 a month service agreement..what is it for? I agree...after I typed that, I asked myself "What is the $4.95 service fee if the service agreement fee is $100 per month?" And why are you paying it on the machine you already own? This sounds like a rental or lease fee for the equipment.

Which means you aren't really getting the terminals for free and you certainly shouldn't be paying it on the machine you own. Now they didn't claim it to be 90day free trial, just 90 day RISK free trial. I'd be getting clarification on these fees. As for the processing rates, the rates you list are competitive, but they aren't giving you the entire picture. What are the mid qualification and non qualification rates? Qualified (1.64%) applies to normal consumer cards that are swiped in the machine. Mid Qual applies to rewards cards(ETA-I see they tell you the rewards %, but the non swiped might still be higher) and cards numbers that are not swiped for whatever reason. Non Qual applies to business cards and non swiped transactions that you do not get address verification for. He did say "there are qualified, mid-qualified and non-qualified rates. You will deal mostly with qualified rates, which are....." Personally, I would rather NOT deal w/ NOT swiping cards. It seems riskier if the card doesn't swipe in the first place. Depending on how many rewards cards and business cards you accept you could be paying that rate more often that the Qualified.

Ask Chase what your card spread is. What exactly is a card spread? They should be able to tell you from last year's statements. Keep in mind Visa/Mastercard determines how a card qualifies and has a long list of individual rates. The processor is lumping them together into tiered rates to simplify things for the sales pitch. Also...what is their monthly minimum? We meet the minimums. Do they charge batch fees? Good question! Statement fee? No. Annual fee? ??? Probably shouldn't be one if we cancel w/in 90days. Application fee? It was waived. And don't forget to ask about PCI compliance and fees for the annual compliance and possibly a monthly fee if you don't comply. What is this? I don't know if we comply or not. I know its a lot, but if you cover all of those bases you shouldn't have any surprises! HTH

I appreciate you SOOOO much!!! I would've never thought to ask any of these questions, so I'm glad you replied.

 

[NVDisMom]

You are dealing with two contracts here, even if they are put together into one form. The first is you contract for the terminal, the second is your contract for actually processing the credit cards. The terminal contract "sounds" like it is a 90 day trial that is costing you $100/month for each terminal plus set up fees and such. You should not be paying Chase each month for the terminal you own except for the wireless access (which might be a third contract, check and see). A reprogram fee, yes and a monthly maintenance fee of roughly $5, sure. I can see them maybe allowing you to cancel that portion of the contract within the 90 days. But, what if your season lasts longer than 90 days? And what about the subsequent years? The processing contract is separate and I seriously doubt they will let you out in 90 days without some sort of early termination fee. These contracts are usually for three years. Did you set it up as seasonal so you can turn it off during the off season and not have to pay monthly minimums? On the qualified, mid qualified, non qualified...It sucks. Its a pain. Let me see if I can explain it better with a few scenarios. Sometimes you cannot avoid being down graded. The customers magnetic stripe doesn't work and its the only card they have with them. Are you going to turn away the business? Probably not, so you will pay the higher rate. Yes, it is riskier to not swipe, but it happens in every business at one time or another. Or the customer is using a rewards card, automatic down grade to Rewards rate. Or the customer uses a business/corporate credit card, again, automatic down grade. There are other card types too that can downgrade the rate you pay. When I was referring to card spread...Your statement from your previous processor will show what rates they charged you for each tier of cards you accepted as well as how much volume in dollars and a count of how many individual transactions. The percentage of total dollars in each category is your card spread. So, your spread could be 35% debit, 15% qualified, 25% rewards, 1o% mid qualified, and 15% non qualified. So 35% of the transactions you would pay 1.3%, 15% you would pay 1.64%, etc. You want to know what your mid and non qual rates are so you can compare apples to apples. KWIM? Without that info you cannot make an informed comparison. If there is an annual fee it will be on the processing contract that is probably not cancel-able, not the terminal contract. PCI compliance...its fun. VERY simplified explanation: Visa and Mastercard require every business that handles their transactions to comply with a set of security rules, from the business that accepts credit card payments to Chase that processes the actual transactions on the network. In order to be sure that you are following the rules they require the business to get a certification that states such. That certification is a series of questions that you answer about how you store customer data and such, then if you pass you get your certificate of compliance. You pay a third party for that service and it is required EVERY year. If you do not get the certification you will pay a monthly fee until you do. All of this should be covered in your contracts. Read everything before you sign and ask for clarification, by email if possible so you can save the responses and use it later to get fees waived if it should come to a head. BTW- this is true of any processor, large or small. At least you know, going with Chase, since they are so big, that they will be there in a year. I feel sorry for people who sign up with small processors and then they wipe out their bank accounts and go out of business. There is very little recourse. You are giving ACH/EFT permission to this company and it is difficult to revoke if you are dealing with an unscrupulous entity. HTH and good luck. Let me know if I can be of any further help.

 

[weHEARTmickey]

He sent me this "Schedule A Pricing Sheet." Right off the bat, it concerns me that he quoted me $0.19 per transaction, and here it shows $0.20. I know that's only a penny, but it's dishonesty!! Another thing is, he quoted me Verifone VX-610 wireless terminals, and here he listed Vx-570 + another. I'm no genius, but when you go DOWN in model #, that usually means an older model, right?!?! I will say this: on another page, he mentions $100 rental fees x2 (where as he said x3 yesterday.) So at least that answers our question about the $100 charges.
------------------------------------------------
Discount Fees:
Three Tier - Visa, MasterCard, and Discover transactions will be processed at one of nine possible rates detailed below, according to the Interchange Level at which the transaction is processed.
...................Credit Cards ..Debit Cards .Rewards Cards
Qualified ..........1.64%.............1.48% ....... 2.35%
Mid-Qualified ......2.48%.............. 2.46% ......... 2.86%
Non-Qualified .........3.48%....... 3.48% ......... 3.48%
Non-Bankcard Discount Rates:
JCB (Paymentech Settled) 3.20%
Revolution Money 0.50%

Authorization Fees:
MasterCard/Visa/Discover $0.20
Voice Authorization$0.65
Amex Auth / Capture Fee $0.20
JCB Auth Fee $0.20
PIN Debit (Online) / ATM Cards $0.25 plus Debit Network Fees

Payment Brand Pass-Thru Fees Visa MasterCard Discover
Assessment Rates 0.11% 0.11% 0.10%
Int’l Cross Border Fees 0.40% 0.40% 0.55%

AVS Auth Access Fee $0.005/$0.0075*
Zero $ Account Verification Fee $0.025
Misuse of Auth Fee $0.048
Zero Floor Limit Fee $0.100
*Card Present / Card Not Present Transactions

Monthly Service Fee: $4.95
Supply Fee: Per Order

Miscellaneous Fees:
Application Fee Waived ACH Return Fee $25.00
Annual Fee Waived Batch Fee Waived
Chargebacks $10.00 Minimum Monthly Waived
AVS Fee Waived Visa Zero $ Account Verification Fee $0.025


Terminal Pricing:
......................Purchase Price....36 Month Lease........48 Month Lease
Ingenico i5100 $500.00................. $30.00................. $24.00
VeriFone Vx570 $595.00............. $35.00.................. $30.00

Amount payable upon termination: In addition to the other amounts due under this Agreement (including, without limitation, the fees and charges described in this Schedule A), you may owe an amount in the event you terminate this Agreement. Whether you will owe that amount, and how much you will owe, will be determined in accordance with Section 10 of this Agreement.
Payment Brand Charges
A significant amount of the fees that we charge you for processing your Payment Transactions consists of charges that we must pay to the Payment Brands and Payment Brand issuers (or that are otherwise charged by the Payment Brands and Payment Brand issuers in connection with your Payment Transactions). These charges, which include interchange, assessments, file transmission fees, and other charges are referred to in this Schedule as “Payment Brand Charges”. Thus, in addition to the fees set forth above in this Schedule, you will also be charged Payment Brand Charges. Notwithstanding the foregoing, we may temporarily elect not to charge you for certain Payment Brand Charges. Therefore, it is possible that you may not be charged for certain Payment Brand Charges for a period of time. If that is the case, our election not to charge you for those Payment Brand Charges should not be construed as a waiver of our right to charge you for those Payment Brand Charges, and we reserve the right to start charging you for them upon notice to you at any time in the future. No such charges will be imposed retroactively, however. Our right to impose such charges in the future extends to Payment Brand Charges currently in effect, increases in the amount of those Payment Brand Charges, and new Payment Brand Charges imposed by Payment Brands and Payment Brand Issuers.
Interchange and Assessments
Payment Brand Charges, including interchange fees and assessments, are set by the Payment Brands and Payment Brand Issuers based in part upon a series of interchange levels that they establish and modify from time to time. Thus, the interchange fee and amount of assessments charged for a given Payment Transaction depends on the interchange level applicable to that Payment Transaction; and that interchange level depends on a number of factors established by the Payment Brands, such as the type of Payment Instrument presented, specific information contained in the Payment Transaction, how and when the Payment Transaction is processed, your industry, and other factors. For a Payment Transaction to qualify at any specific interchange level, the applicable qualification criteria must be met. Note that the Payment Brands regularly add new interchange levels, and change the interchange rates or qualification criteria for existing interchange levels.
Capitalized Terms: Please review the definitions in your Agreement so that you understand the capitalized terms we use in this pricing schedule. The capitalized term "Payment Brand" has the same meaning as the term "Payment Brand" or "Association" in your Agreement. The capitalized term "Rules" has the same meaning as the term "Rules", "Association Rules", or "Regulations" in your Agreement. The capitalized term "Payment Transaction" has the same meaning as the term "Payment Transaction", "Card Transaction", or "Sales Data" in your Agreement. The capitalized term "Payment Instrument" has the same meaning as the term "Payment Instrument", "Card", or "credit card" in your agreement.
IF YOU SELECT TO USE A PINPAD ENTRY DEVICE, PLEASE READ THE FOLLOWING CAREFULLY
If you are not currently using a PCI PED / TDES device according to the Visa website listing, you will be required prior to July 1 2010 to upgrade to a certified device at your own cost. You can find a listing of devices supported by Chase Paymentech at www.chasepaymentech.com/merchantcenter.

 

[NVDisMom]

First, neither of those terminals are wireless. They are countertop solutions. One is IP capable, idk with the other one. Read the fine print at the bottom too. You will have a termination fee. It says to refer to another document to find out how much. Its normal and you would definitely have it with every processor unless you set up a seasonal account. I'd get a competitive bid from another large credit card processor. Are you a Costco member? Find out what they can do.

 

[hipchickie]

We haven't purchased the terminals b/c they become obsolete so quickly. (We purchased them 4 yrs ago & had to EAT the cost. The wireless service wasn't that great & when we tried to use them with another service provider, they said they couldn't use those machines.)

I am intrigued by this - what were the terminals? I have had mine for 10 years and no problems with it becoming obsolete.
Did you try any other providers?

 

[weHEARTmickey]

First, neither of those terminals are wireless. They are countertop solutions. One is IP capable, idk with the other one. Read the fine print at the bottom too. You will have a termination fee. It says to refer to another document to find out how much. Its normal and you would definitely have it with every processor unless you set up a seasonal account. I'd get a competitive bid from another large credit card processor. Are you a Costco member? Find out what they can do.

That's frustrating b/c they HAVE to be wireless!!! I don't see a termination fee on the other forms (but, of course, I haven't read all THIRTY pages yet.) That was an exaggeration, but there are about 11 to read. We aren't Costco members. Which provider do they use? Is this who your DH works for?

I am intrigued by this - what were the terminals? I have had mine for 10 years and no problems with it becoming obsolete.
Did you try any other providers?

Well, what's funny is the VX-610 is one we own & now Chase says they use them. Our local bank + First Data told us we couldn't use them. We have two OTHER machines, but both have to have a phone line. This isn't an option for us.

We have checked with 3 providers now. I think I'll call ALL the local banks around here, just to see what's out there. Now we're getting down to the wire. If the weather cooperates, DH will open on March 1st.

 

[NVDisMom]

That's frustrating b/c they HAVE to be wireless!!! I don't see a termination fee on the other forms (but, of course, I haven't read all THIRTY pages yet.) That was an exaggeration, but there are about 11 to read.Yes, hiding details in the fine print is common. DO take the time to read all of it. We aren't Costco members. Which provider do they use? Is this who your DH works for? Elavon. The best pricing will probably be from Costco itself. They tend to loss lead.


Well, what's funny is the VX-610 is one we own & now Chase says they use them. Our local bank + First Data told us we couldn't use them. We have two OTHER machines, but both have to have a phone line. This isn't an option for us. The VX610 is a current and very up to date model. I don't know where you originally acquired it though. Sometimes providers will put proprietary chips in them that make them near impossible to reprogram and it creates a ton of head aches for the new processor. So many representatives will tell you they can't use it, its just too much of a hassle from the customer service stand point. You may want to reconsider buying a couple of terminals. It does cost you a lot less in the long run unless your people are very hard on the equipment. Google it. You don't have to buy from the processor, but do know you will probably have reprogram fees and they wn't help if you have hardware failure in the future.

We have checked with 3 providers now. I think I'll call ALL the local banks around here, just to see what's out there. Now we're getting down to the wire. If the weather cooperates, DH will open on March 1st.

Yep, it takes about a week to get everything approved and shipped out.