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What Is Straight Pass Through for Merchant Accounts?
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What Is Straight Pass Through for Merchant Accounts?

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Robb Lejuwaan explains that If you have a merchant account you need straight pass through. Watch this presentation to find out why.

Robb Lejuwaan explains that If you have a merchant account you need straight pass through. Watch this presentation to find out why.

Published in: Economy & Finance, Technology

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  • 1. What is Straight Pass Through? For Merchant Accounts It is when you, as a business, receive surcharges from Visa and MasterCard at true bank cost
  • 2. What is Straight Pass Through? For Merchant Accounts Let me explain …
  • 3. What is Straight Pass Through? For Merchant Accounts With a merchant account there are two price points: 1. Your base discount rate
  • 4. What is Straight Pass Through? For Merchant Accounts With a merchant account there are two price points: 1. Your base discount rate This is the rate for transactions when a normal consumer credit card is used
  • 5. What is Straight Pass Through? For Merchant Accounts With a merchant account there are two price points: 2. Surcharges
  • 6. What is Straight Pass Through? For Merchant Accounts With a merchant account there are two price points: 2. Surcharges These are added to the base discount rate on transactions where a rewards card, corporte card, etc. are used or when the credit card in not swiped.
  • 7. What is Straight Pass Through? For Merchant Accounts First let’s look at a typical merchant account without straight pass through…
  • 8. What is Straight Pass Through? For Merchant Accounts Your merchant account would have fees like this… base discount rate of 1.89% and $.10 per transaction mid-qualification rate of 2.50% and $.10 per transaction and non-qualification rate of 3.20% and $.10 per transaction
  • 9. What is Straight Pass Through? For Merchant Accounts Let’s define what these terms mean…
  • 10. What is Straight Pass Through? For Merchant Accounts Base Discount Rate = the rate for generic consumer cards that are present and swiped
  • 11. What is Straight Pass Through? For Merchant Accounts Mid-Qualified Rate = the rate for swiped rewards cards or generic comsumer cards that are keyed in
  • 12. What is Straight Pass Through? For Merchant Accounts Non-Qualified Rate = the rate for keyed in rewards cards, corporate cards, business cards and transactions with important information missing
  • 13. What is Straight Pass Through? For Merchant Accounts So let’s review those rates again… base discount rate is 1.89% and $.10 per transaction mid-qualification rate is 2.50% and $.10 per transcaction and non-qualification rate is 3.20% and $.10 per transcaction
  • 14. What is Straight Pass Through? For Merchant Accounts Now let’s see how rates on a straight pass through account work base discount rate is 1.89% and $.10 per transaction + surcharges direct from Visa and MasterCard
  • 15. What is Straight Pass Through? For Merchant Accounts So how much of a difference does straight pass through make?
  • 16. What is Straight Pass Through? For Merchant Accounts EXAMPLE #1 Swiped Visa Rewards Card 2.50% 2.00% Actual Rate (mid-qualification) .11% Visa Surcharge 1.89% 1.89% Base Rate Regular Account SPT Account
  • 17. What is Straight Pass Through? For Merchant Accounts EXAMPLE #1 Swiped Visa Rewards Card So a straight pass through account would give you a .50% reduction on this type of card
  • 18. What is Straight Pass Through? For Merchant Accounts EXAMPLE #2 Keyed in, card not present Visa or MasterCard 2.50% 2.20% Actual Rate (mid-qualification) .31% Surcharge 1.89% 1.89% Base Rate Regular Account SPT Account
  • 19. What is Straight Pass Through? For Merchant Accounts EXAMPLE #2 Keyed in, card not present Visa or MasterCard So a straight pass through account would give you a .30% reduction on this type of card
  • 20. What is Straight Pass Through? For Merchant Accounts EXAMPLE #3 Visa EIRF 3.20% 2.65% Actual Rate (non-qualification) .76% Visa Surcharge 1.89% 1.89% Base Rate Regular Account SPT Account
  • 21. What is Straight Pass Through? For Merchant Accounts EXAMPLE #3 Visa EIRF So a straight pass through account would give you a .55% reduction on this type of card
  • 22. What is Straight Pass Through? For Merchant Accounts EXAMPLE #4 Corporate Card 3.20% 2.55% Actual Rate (non-qualification) .66% Visa Surcharge 1.89% 1.89% Base Rate Regular Account SPT Account
  • 23. What is Straight Pass Through? For Merchant Accounts EXAMPLE #4 Corporate Card So a straight pass through account would give you a .55% reduction on this type of card
  • 24. What is Straight Pass Through? For Merchant Accounts EXAMPLE #5 MasterCard Check or Debit Card 1.89% 1.36% Actual Rate -.53% MC Surcharge 1.89% 1.89% Base Rate Regular Account SPT Account
  • 25. What is Straight Pass Through? For Merchant Accounts EXAMPLE #5 MasterCard Check or Debit Card No, the minus sign was not a mistake; with check cards you, as a business, are entitled to receive a rebate from both Visa and MasterCard. So a straight pass through account would give you a .53% reduction on this type of card
  • 26. What is Straight Pass Through? For Merchant Accounts Effective Rate Allows you to see what you are really paying for your merchant account. Here is an example: Total bank card Volume - $72,053.25 Total merchant account fees – $1942.52 Effective Rate: 2.695% Base Rate – 1.79%
  • 27. What is Straight Pass Through? For Merchant Accounts Now it is time for a quiz
  • 28. What is Straight Pass Through? For Merchant Accounts Question #1 When shopping for a merchant account, what price point is more important? A. Base Discount or B. Surcharges
  • 29. What is Straight Pass Through? For Merchant Accounts Answer: You need to pay attention to both price points. For years merchant account providers have made the focus the base discount rate and have made most of their profit on the surcharges. It is time for that to change.
  • 30. What is Straight Pass Through? For Merchant Accounts Question #2 How can you make your merchant account straight pass through? A. Contact your current provider and renegotiate or B. Contact a new provider that only has straight pass through accounts
  • 31. What is Straight Pass Through? For Merchant Accounts Answer: Why would you contact your current provider if they have been hiding fees from you. Do they really deserve any more of your business? The answer is to go with a company that only operates above board with straight pass through accounts.
  • 32. What is Straight Pass Through? For Merchant Accounts To get your very own straight pass through merchant account CLICK HERE