I was charged extra for using my credit card

[Littleshop]

Square charges 2.75% if the card is present. 7% is robbery and he just stole from you.

Most processors charge less than 1.99% and you can always find one that's cheaper. I've heard its as low as 1.5%.. I'm not 100% on the facts, but I also learned that when you sign up the person who signs you up makes the extra %'s.. So they're making 1.5% of your transactions, so they can always lower it and only make .5%..


Robbery.

Nonsense, that is not all of the charges.  Square doesn't charge for the 'interchange' fees, because they don't have too, the contracts that the CC companies had with the vendors and each other negates most of that.

And nothing in this conversation includes the interest and fees that the cardholder eats due to his own contract.

That should all be added in with your cost to rent, not given to the customer as an extra tab.

Advertising something as $100 then charging $107 because of your fees is crazy. I doubt anyone is charging 7% in any fees to swipe a card.

Is advertising something as $107 and then offering a $7 discount to cash customers any different?  Because that's basiclyhow it's been done for the past 30 years.  Yes, 7% is on the high end, but not unrealistic for a small vendor that does not frequently need to use the CC network.  7% would be very high for a volume user, such as a brick & morter retail chain of any size; in such a case the 2.x% charged by Square (due to the volume that Square can accumulate) is much more realistic.  WAl-mart can negotiate for better terms from Visa, but a small kayacking store probably can't.  I'd bet dollars to doughnuts that any business with a building of their own can't use Square due to the TOS, or Visa would have a fit.

Giving a discount and charging extra is two different things, be ignorant more please.

You obviously have never used a creditcard processor.

First off 7% is unheard of unless you're selling high risk products. Please stop being ignorant and saying 7% is a normal price because you have no idea what the hell you're talking about. It does not matter if you're doing $100 in sales a day or $1000 they're not going to charge you any different rates, unless your doing massive amounts of money.

As for square, again you owe me doughnuts, or money, I like both.

https://squareup.com/register

I use square every single day.
Why them at 2.75% vs someone else at 1.99%?

1. Square I don't need to rent a swiper that costs $50-100 a month on a 4 year contract.
2. I don't need to pay $50-100 a month gateway fees.
3. I don't have all the other crazy fees.
4. Square deposits next day vs 3-4-5 days for other processors.

For smaller volume you might have the best deal.  I pay under 2% for non rewards visa/mc but as of a few years ago they add in about .5% for most rewards cards.  I pay about $20 in total other fees other then the percentage.  Amex is a bitch as they are about 3% for me. 

I ran a campaign a while ago offering 5% (more then my fees) for cash or debit cards over $100 (that used to only cost me 39 cents total) and almost nobody took it!

[1714473675]

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[MoonShadow]

Giving a discount and charging extra is two different things, be ignorant more please.

Economicly speaking, they are exactly the same.

You obviously have never used a creditcard processor.

First off 7% is unheard of unless you're selling high risk products. Please stop being ignorant and saying 7% is a normal price because you have no idea what the hell you're talking about. It does not matter if you're doing $100 in sales a day or $1000 they're not going to charge you any different rates, unless your doing massive amounts of money.

As for square, again you owe me doughnuts, or money, I like both.

https://squareup.com/register

I use square every single day.
Why them at 2.75% vs someone else at 1.99%?

1. Square I don't need to rent a swiper that costs $50-100 a month on a 4 year contract.
2. I don't need to pay $50-100 a month gateway fees.
3. I don't have all the other crazy fees.
4. Square deposits next day vs 3-4-5 days for other processors.

Note the highlighted parts of your post.  It would be trivial for those fixed fees to add up for a small vendor, and through the total for the merchant to about 7%, and you aren't even metioning all the fees that are common.  Also, does your business do enough volume to justify a storefront?  Square was never intended for POS processing with regard to fixed sale points. 
If you are using your Iphone as a cash register inside of an actual store, you're likely violating the TOS that Square had to agree to in order to get the CC compaines to sign on.
 Whether or not it's actually legal or proper for the kayak company to charge 7% was never my point, or my concern.  I was simply pointing out that, IMHO, it's not an unrealistic number.  You have failed to contradict that claim; in fact, you have managed to provide supporting evidence for my point.

I'm fine with you paying up in just doughnuts, since it was such an easy win.

[DeathAndTaxes]

Where do you get this idea that square can't be used at a "fixed location".  If I stand still to long does that become a fixed location.  7% for a swiped CC transaction isn't a realistic number.  You made up some stupid explanation and now just can't accept that you are wrong.  There is nothing square's TOS which prohibits it being used in a POS location.

https://squareup.com/register/receipt-printer-and-cash-drawer



Credit cards might be last world technology and a ripoff but Square is at least innovating somewhat and they deserve credit (without FUD) for that.  Hell they actually now have a 0% fee option.  $275 per month for up to $20,833 in transactions (works out to about 1.3% for a merchant which maxes it out).

[deepceleron]

That's not a rip off. Credit card customers should bear the full burden of the credit card expenses: sign up fees, annual membership fees, terminal fees, PCI compliance fees, the cost of terminals and POS systems, leased phone lines and internet, IRS reporting fees, lost interest and opportunity from capital locked up by the credit card companies, reversals and chargebacks, fraud, accounting costs. All those should go into the credit card markup.

The money charged on a credit card is also not cash that can just be put in the owner's pocket at the end of the day. Tipping on a credit card is like giving 70% to the server and 30% to the government.

[MoonShadow]

Where do you get this idea that square can't be used at a "fixed location".  If I stand still to long does that become a fixed location.  7% for a swiped CC transaction isn't a realistic number.  You made up some stupid explanation and now just can't accept that you are wrong.  There is nothing square's TOS which prohibits it being used in a POS location.

https://squareup.com/register/receipt-printer-and-cash-drawer



Credit cards might be last world technology and a ripoff but Square is at least innovating somewhat and they deserve credit (without FUD) for that.  Hell they actually now have a 0% fee option.  $275 per month for up to $20,833 in transactions (works out to about 1.3% for a merchant which maxes it out).

Well, technically you are correct on this point.  I just checked the TOS.  No, they wouldn't prevent you from setting up Square in a normal storefront as your primary POS system.  Instead, the CC companies can compell Square to require you to engage into a pass-through agreement with the CC companies directly, which acheives the same end goal....

7. Our Role.
The Services allow you to accept payments, including card-based payments initiated with cards bearing the trademarks of MasterCard International Inc. and Visa Inc. (collectively, the “Networks”). We are not a bank, and we do not offer banking services as defined by the United States Department of Treasury. We also do not offer money service business (“MSB”) services as defined by the United States Department of Treasury.

As a merchant payment processor, Square processes payments you receive from your customers. This means that we collect, analyze and relay information generated in connection with these payments.

In order to serve in this role, we must enter into agreements with Networks, other processors and banks. These third parties require that some of our users enter into an agreement with Square’s payment processor of record. If you are such a user, we will provide you a “Commercial Entity Agreement” that you must complete in order to use the Services. This may happen during the registration process or at some other time. If you fail to complete a “Commercial Entity Agreement,” we may suspend or terminate your Square Account.

And there is an enforcement clause that you agreed to that could be used towards this end...

4. Verification and Inspection.
If your request to open a Square Account is approved, Square may request additional information from you at any time. Square may ask you to present invoices from your suppliers, a government issued identification such as a passport or driver’s license, or a business license. Square may also ask for permission to inspect your business location. If you refuse any of these requests, your Square Account may be terminated. We reserve the right to suspend or terminate the Square Account of any user who provides inaccurate, untrue, or incomplete information, or fails to comply with the account registration requirements.

So while you can set up anything that you like, if your business starts processing enough transactions that the CC companies feel that you should be paying them directly, I'm sure that they will let you know when it's time to "upgrade" your contracts.

https://squareup.com/legal/cea

[DeathAndTaxes]

A lot of wrong assumptions on your part.  Generally larger merchants pay LESS in credit card fees than smaller merchants.  Any merchant big enough to warrant scrutiny is likely big enough to go directly to the source and cut a better deal.  Large established swiped (i.e. not "card not present") merchants generally have discount rates that are half of what Square charges not 3x as high.

[farlack]

@MoonShadow stop making shit up.
You're just trying to say anything to avoid saying you're wrong 

Visa/Mastercard don't get paid directly they go through credicard processors =\
Such as First Data.

There is no "upgrading" your contract I know someone who is doing over 150k a month with square non present cards and all they had to do was call and ask for a larger deposit as current status only lets you deposit $1000 a week in card not present sales..



As for the 7% being unrealistic, google creditcard processor, find a single company charging 7% for non high risk transactions.
Your claim is well researched.

[MoonShadow]

Fine, you guys all suck, and you all seem to have more experience with modern CC transaction than I do.  I'm too old, etc.

I still stand by my opinion that 7% isn't unrealistic.  Good luck disproving my opinion, which is what it always was, and it still is.

High?  Yes.  Excessively high?  No, it's not.  Who gets to decide?  I do, because it's my opinion.

So bite me, children.

[JoelKatz]

I went Kayaking the other day and rented a kayak.

The charge was $35. But they said "if you're going to use a credit card we charge extra". I used my credit card and they charged $37.50.

You are lucky. This practice is still illegal in my State (California) so I can't gain any of the benefits of this practice.

[Littleshop]

Fine, you guys all suck, and you all seem to have more experience with modern CC transaction than I do.  I'm too old, etc.

I still stand by my opinion that 7% isn't unrealistic.  Good luck disproving my opinion, which is what it always was, and it still is.

High?  Yes.  Excessively high?  No, it's not.  Who gets to decide?  I do, because it's my opinion.

So bite me, children.

It is real easy.  You both are right.  Small merchants with small volume can pay that much as well as high risk merchants.  It is certainly not many that pay that much but it is possible.  Also people who do not know how to bargain and deal with the first company they find to take credit cards.

I still remember my first credit card machine (in the 90's)  I got a great rate but entered into a rip off lease.  Factor in that lease and probably paid 7%.

As the volume increases rates go down.  
As risk decreases rates go down.
As the smarts of the merchant go up the rates go down.