A common grudge held by most merchants is that the merchant account providers are looting them with their hidden fees et al. Is it really true? Not quite. Let’s see why.

Hidden fees

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There’s an article right here posted recently that covers some of the hidden, and not so hidden, fees charged by merchants. This is what they mainly include:

• Transaction Fees
• Set-up fees
• Credit Card related fees
• Assessment fee
• Discount rate
• Minimum monthly discount fee

Do these fees mean the merchants are trying to get their hands into your pocket? Not really. Remember that these account providers also have to pay their own fees to credit card companies. How can they cover these? By passing them off to you, of course. And it is a business for them, which means they need to make a profit. So they add a certain margin. Fees like Non-qualified Credit Card fee, cross-border payment fee, monthly minimum discount rate are levied by necessity rather than out of greediness.

Consider this: third party merchant account providers do not usually levy any minimum monthly discount fee. Does this mean they are kind men running a charity? Not quite. They make even more money, in fact. Direct merchant account providers need to levy these ridiculous fees so that they can meet their targets. They can’t pay credit card companies from their own pockets, can they?

They make it easy for you

Imagine how easy your life becomes because of these merchant account providers. For that, isn’t it worth it to pay some fee? It’s not like you are paying the sun and the moon for their services. You are paying less than 5% per sale in the long run if you combine all kinds of fees. For this measly amount, you can start accepting payment from all over the world. From running a mom and pop shop on the corner of a street, you can start selling things globally and build an empire for yourself. For this, you still think 5% is too much? From making $100 a day without a merchant account, wouldn’t you rather make $1000 and then pay 5% of it? You are not losing $20 by doing so. You are gaining $880. You should be thanking your merchant account provider.

They are running a business, not a charity

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There’s no free lunch, really. You can’t expect them to provide you cheap accounts and run themselves into the ground. They are running a business just like you are. They need to make profits, wouldn’t you agree? After paying the credit card companies and the government, they don’t really make as much off you as you imagine.

It’s time online merchants stopped complaining about merchant account providers and started thanking them for the services they provide. The next time you feel frustrated, just remember that they are businessmen like you, and are actually helping you grow, not stifling you.

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