Hotels, Restaurants, and Retailers Paid Excessive Debit Card Processing Fees During Super Bowl XLVII

Feb. 4, 2013 - PRLog -- The Federal Reserve's Regulation, which went into effect October 1, 2011, capped the maximum interchange fees that banks with at least $10 billion in worldwide assets could receive on debit card transactions. As of Super Bowl Sunday 2013, the cap on debit interchange rates significantly reduced the cost for credit card processors but not necessarily the merchant.

“While it is a fact that the Durbin Amendment requires banks to lower the debit card fees they charge, it does not require the credit card processor to pass that reduction to the merchant,” said Trennier Mathews with Vital Cash Flow.” “As a result, many merchants are now paying over 100 basis points in excessive debit card processing fees, which can significantly increase their cost of doing business.”

One of the reasons why merchants tend to be overcharged in the merchant processing industry is that sales representatives are rarely trained to understand buy rates, enhanced fees, or Visa and MasterCard interchange. Training typically consists of a few days, which involve memorizing a sales script and completing paperwork properly. And, although many sales representatives know little about the industry they represent, merchants know even less.

“You will find that most processors in the credit card processing industry aren’t really thinking about merchant’s needs or bottom-line.” Mathews said.  “Because of this, unneeded fees and hidden charges are often taken right out of the merchant’s hard-earned profits each day.”

Whether the merchant owns a restaurant, hotel, retail, or service business, it’s important to manage credit card processing fees like any other major business expense. However, unlike other expenses, credit card processors get a percentage of every sale a merchant submits for payment.

“It’s nice to have big events like the Super Bowl to drive more business to merchant locations throughout our nation. What would be nicer is for merchants to keep more of their hard-earned money to invest in their local business, create jobs, and help grow our economy from the ground up,” Mathews said.

For a free guide on how to stop unneeded credit card processing fees visit www.bit.ly/stopfees

Contact:
Trennier Mathews
Vital Cash Flow
407-476-4801
trennier@vitalcashflow.net