Annual Card-Brand Increases Often Trigger Processor Rate Increases
Recently, several clients of Heartland Payment Systems found themselves facing unexpected fee increases, including new annual and one-time infrastructure fees.
It’s not uncommon for payment processors to adjust their rates. Every April and October, the major card brands—Visa, Mastercard, American Express, and Discover—update their processing rates and rules. Many processors, including Heartland, use these updates as an opportunity to adjust their own fee structures as well. That’s why it’s crucial for businesses to stay informed when these changes occur.
Transaction-Focused, Not Cost-Focused
There are thousands of credit card processing vendors in the U.S., each offering a range of value-added services. While these offerings can be beneficial, it’s important to recognize that, ultimately, most processors are focused on facilitating secure transactions—not on optimizing merchant costs.
Heartland Payment Systems, which services an estimated 500,000 merchants across the U.S., is no different. The company offers a robust suite of value-added services, such as advanced point-of-sale technology, payroll solutions, and enhanced electronic payments capabilities.
But, while these tools and services are certainly valuable, the responsibility for optimizing processing costs is ultimately up to each merchant.
How Verisave Helped Clients Reclaim Costs
When Heartland introduced new fees for their clients, several businesses affected by these increases turned to Verisave for help. Our team worked closely with each client’s finance team to analyze the new fee structures, compare them against industry benchmarks, and, wherever possible, reverse the increases and waive one-time fees.
To achieve this, we used data from a broad range of businesses processing similar volumes and transaction mixes to identify opportunities for cost savings. Here’s a snapshot of some of the results we achieved for our clients:
The Results:
Large East-Coast Auto Group
- Previous applicable fee: 12bps + $0.055
- Increased to: 122bps + $0.155
- Results of benchmark comparison: Reduced to 30bps + $0.10
- Cost savings: $1,500/month
Food Manufacturer
- Previous applicable fee: 110bps
- Increased to: 220bps
- Results of benchmark comparison: Reduced to 40bps
- Cost savings: $1,350/month
Conclusion:
Fee increases from payment processors are a common part of doing business, but they don’t have to be a permanent burden. By actively managing your processing relationship and seeking out third-party experts like Verisave, businesses can identify hidden opportunities to reduce costs and stay competitive.
If you’re seeing unexpected fee increases or believe your payment processor fees are too high, it’s worth taking the time to review your rates against industry standards. Proactive management can lead to significant savings and keep your business operating efficiently in an increasingly complex payment landscape.
If your business is looking to better manage your merchant account or reduce fees, we’re here to help. We fix and monitor your existing merchant account, and we bring that money back to you. No need to change processors or add a project to your team’s already hectic workload. Schedule a consultation today.
Verisave is a third-party cost-reduction firm specializing in merchant accounts and credit card processing fees.
Verisave is not a payment processor, and is not affiliated with any processors, card brands, or banks.
Verisave has more than 20 years of experience optimizing and monitoring the credit card processing industry.