Merchant Services Terms & Definitions

Application & Set up Fee
Initial fee paid to merchant service provider for establishment of account, processing and reporting tools & capabilities.

Discount Rate
The percentage of the transaction that the merchant is charged by the merchant service provider for facilitating a credit card transaction.

Example: ( 2.35% of $100 = $2.35 )

Transaction Fee
Small charge paid to the "processing network" (e.g., Visa/MasterCard) for use of their system, for each transaction processed.

Example: ( 2.35% of $100 = $2.35 + .25 cents for the transaction = $2.60 )

Minimum Monthly Fee
Merchants pay for credit card service on a per transaction basis, through a combination of transaction fees and discount rate charges. Generally, based on normal business volume, these transaction-related charges cover the minimum monthly fee.
Example: ( 2.35% of $100 = $2.35 Minimum is $15 - $2.35 = $12.65 )

Monthly Service & Statement Fee
Monthly service charge paid to merchant service providers for statement preparation, reports and 24/7 technical support.

Monthly Gateway Fee
A monthly service fee charged for using secured processing fiber-optic lines to complete transactions immediately in encrypted, protected code.

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