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Need Help - Credit Card Processing

Discussion in 'Business Operations' started by DFW Area Landscaper, Apr 24, 2004.

  1. DFW Area Landscaper

    DFW Area Landscaper LawnSite Silver Member
    from DFW, TX
    Messages: 2,116

    This spring I finally decided to bite the bullet and get signed up for credit card processing. My uncollectibles last year were about 8% at the time (which have since fallen to about 3.19%).

    The credit card processing company told me the fees would be 2.29%, 25 cents per transaction and $9.95 per month for a statement fee.

    What they didn't explain is that with each "non-qualified" transaction, I'd pay an additional 2.49%. Last month, 95% of my transactions were "non-qualified".

    The credit card processing company told me that if I get the CVV number from the back of the card and the billing address, the transaction should be "qualifed". How the one transaction last month was "qualified" is beyond me, because I haven't recorded the CVV number from any of my customers credit cards.

    With the additional 2.49%, the total loss is about 5%. I simply cannot give up that much of my revenue. Especially considering that my uncollectibles are lower than that.

    So, what do I do now???

    A) Send a letter with the next statement to each customer explaining that our credit card processing costs have risen and we would prefer they just mail us a check each month.

    B) Send a letter with the next statement to each customer asking them to please provide us with the CVV number and billing address.

    C) Send a letter with the next statement to each customer offering a $5.00 credit if they provide us with the CVV number and billing address.

    D) Call each customer before the next statement is mailed, explain the situation, and ask them for the CVV number and billing address of their credit card.

    E) Other ideas

    Thanks,
    DFW Area Landscaper
     
  2. wobblez

    wobblez LawnSite Member
    from Alabama
    Messages: 38

    I think what I would do to cover you rearend and get the lower rate plus put your customers at easy is to make a form with there name billing address card number and cvv number on it with a statment on it stating you are allowed to bill them monthly for charges have them sign it and include a copy of there ID.
    let them know this is to protect you and them from ID theft.
    if they ever say they did not allow you to do you will have proof signed by them. you will have the cvv number and billing address.
     
  3. tx_angler

    tx_angler LawnSite Senior Member
    Messages: 278

    I just canceled my credit card processing and the company said I had to send them a signed form stating I wanted to cancel. OK no problem unitl I read the fine print on the form. They're going to charge me $195.00 termination fee!

    When pigs fly - I closed the bank account! We'll meet in court over a $195.00 termination fee!
     
  4. DFW Area Landscaper

    DFW Area Landscaper LawnSite Silver Member
    from DFW, TX
    Messages: 2,116

    ++++I closed the bank account!++++

    That's what I was thinking I might have to do. A new book of checks would be a lot less than paying their minimum for the next three years.

    Did you go with another credit card processing company? Or have you decided to just not accept credit cards again? I'd like to be able to accept them, but there's no way I can give up an additional 2.49%...with the base of 2.29% and the monthly statement fee and the transaction fees of $.25 here and $.15 there and $.05 there, my total credit card costs were 5.9% of what I processed last month.

    Later,
    DFW Area Landscaper
     
  5. houston

    houston LawnSite Member
    Messages: 71

    ---What they didn't explain is that with each "non-qualified" transaction, I'd pay an additional 2.49%. Last month, 95% of my transactions were "non-qualified".---

    What is a "non-qualified" transaction?

    ---
    The credit card processing company told me that if I get the CVV number from the back of the card and the billing address, the transaction should be "qualifed". How the one transaction last month was "qualified" is beyond me, because I haven't recorded the CVV number from any of my customers credit cards. ---

    What is a "CVV" number?

    I have been accepting credit cards for 3 years and have never heard or read anything about "not qualified" or "CVV number".

    :confused:
     
  6. DFW Area Landscaper

    DFW Area Landscaper LawnSite Silver Member
    from DFW, TX
    Messages: 2,116

    Houston,

    The CVV number is the 3 digit code on the back of the card following the account number.

    What kind of processing fees are you paying?

    Thanks,
    DFW Area Landscaper
     
  7. houston

    houston LawnSite Member
    Messages: 71

    I'm paying 2.83% with no monthly fee and no transaction fee.

    Still curious about what a "non-qualified" transaction is? I've never seen that on my statement.

    :)
     
  8. The C Man

    The C Man LawnSite Senior Member
    from Ohio
    Messages: 527

  9. Jagor

    Jagor LawnSite Member
    Messages: 21

    Credit card transaction fees are based on a companies credit card sales volume and safety of the transactions. Lowest rates go to highest volume businesses that have cardholder physically present and "swipe" card for each transaction on latest card processing equipment.
    A non qualified transaction would probably equate to a card "not present" or not "swiped" sale.
    Obtaining a CCV code will not qualify a transaction unless your credit card sale (merchant account) processor allows you to key in the code.
    As a company doing website based business where a card or card holder is seldom present and card is not "swiped" we are forced to pay premium transaction fees.
    As a merchant that also takes Paypal we pay fees which equate to 3% per transaction.
    Credit card or Paypal processing does help your cash flow but a portion of your money is flowing into other peoples pockets. Also, understand these people have no mercy or sense of right or wrong. Regardless of who is at fault in any transaction fradulent or legit the credit card company will side with the cardholder and remove funds from your account. Read any contract and you will see YOU HAVE NO RECOURSE!

    "http://www.jagorequipment.com"
     
  10. DFW Area Landscaper

    DFW Area Landscaper LawnSite Silver Member
    from DFW, TX
    Messages: 2,116

    Houston,

    Who do you use for processing? Maybe I should switch.

    Thanks,
    DFW Area Landscaper
     

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