QuickBooks Point of Sale 9.0 user Guide

Rates:

Most of your costs will be transaction processing fees. Your rate per transaction is determined by your personal and business risk, percentage of card-absent sales, average dollar amount per sale, and total dollar amount of monthly sales. Lowering your transaction risk will also lower the rate you pay.

To get the best rate for the way you conduct business, be sure you understand the rates and qualifications around each type of sale.

Qualified rate is the percentage rate that's charged whenever you accept and process a regular card using an approved processing solution. This is usually the lowest rate you can receive, and it’s often what you’ll be quoted when you inquire about rates.

Mid-qualified rate is the percentage rate that's charged if you accept and process a card that doesn’t qualify for the lowest rate. This may happen when you manually key a card into a terminal instead of swiping it, or if a rewards or business card is being used.

Non-qualified rate is the percentage rate that's charged whenever you accept and process a card that doesn’t qualify for either qualified or mid-qualified rates. This may happen when a card is manually keyed into a terminal versus being swiped, address verification isn't performed, information is missing, or the authorization is not settled within the allotted time frame (usually 48 hours).

A rate increase, otherwise known as a downgrade, occurs when your transactions don’t meet the requirements for the lowest or qualified rate. To mitigate the number of downgrades you receive, make sure your transactions meet the qualification requirements to get you the lowest rate available for every transaction. Train your staff to do the same. Secondly, train closing and opening staff on how to audit transactions totals for errors and close out daily credit card transactions at the end of each day.

Batching means settling the charges to your terminal by sending the completed transactions for the day to the acquiring bank for payment. To make sure you get the best possible rate on all your daily transactions, you must "batch out" within 24 hours. If you don’t, you may raise the risk of dispute and cause your transactions to be downgraded. Remember that dial-up connections are prone to dropped lines and duplicate charges.

Fees:

The interchange fee is a percentage of the transaction and helps to cover authorization costs, fraud, and credit losses. Most merchant service providers include the interchange fee in their bundled rate, which makes it more difficult to identify specific rates. Ask your provider if you can pay the interchange fee as it is incurred. This will prevent you from paying more than you need to and help you keep better track of your transaction costs.