Frequently Asked Questions

Frequently Asked Questions About SelectivePay

Will I be locked into a contract?

No!

What is the difference in interchange pass through and flat rate pricing to a merchant?

Interchange pass-through and flat-rate pricing are two different approaches to pricing credit and debit card transactions for merchants. Here’s how they differ:

Interchange Pass-Through:

Under interchange pass-through pricing, the payment processor charges the merchant the exact interchange fees set by the card networks. The interchange fees vary based on factors like transaction type, card type, and industry.
The payment processor transparently passes the interchange fees directly to the merchant without adding any markup or additional fees.
This model provides transparency and allows merchants to see the specific interchange fees associated with each transaction on their statement.
Merchants have a clear understanding of the actual cost of processing each transaction and can potentially negotiate better rates with payment processors.
Flat-Rate Pricing:

In flat-rate pricing, the payment processor charges the merchant a fixed, predetermined rate for each transaction, regardless of the card type or interchange fees.
The flat rate is typically expressed as a percentage of the transaction amount or a fixed fee per transaction.
This pricing model simplifies the fee structure for the merchant, as they pay a consistent rate for all transactions, regardless of the interchange fees associated with each card type.
However, the flat rate may be higher than the actual interchange fees for some transactions, meaning that the merchant may end up paying more for certain transactions compared to interchange pass-through pricing.
In summary, interchange pass-through pricing offers transparency by directly passing the interchange fees to the merchant, while flat-rate pricing simplifies the fee structure by charging a consistent rate for all transactions, irrespective of the interchange fees. The best pricing model for a merchant depends on their transaction volume, average transaction size, and the specific card mix of their customers.

What does Interchange Pass- Through mean?

The term “interchange pass-through” refers to a pricing model used by payment processors to charge merchants for credit and debit card transactions. In this model, the payment processor passes through the interchange fees directly to the merchant without adding any markup or additional fees.

Interchange fees are the fees paid by the merchant’s bank (acquirer) to the cardholder’s bank (issuer) for processing card transactions. These fees are set by the card networks (such as Visa, Mastercard, or American Express) and vary depending on factors like transaction type, card type, and industry.

Under the interchange pass-through pricing model, the payment processor transparently passes the exact interchange fees to the merchant, usually as a separate line item on their statement. This means that the merchant pays only the actual interchange fees without any additional markup or surcharges imposed by the payment processor.

Interchange pass-through can be advantageous for merchants as it provides transparency and ensures that they are paying the actual cost of processing card transactions. It allows them to understand the specific fees associated with each transaction and can help in negotiating better rates with payment processors. However, it’s important for merchants to carefully review their statements and understand the interchange fee structure to accurately assess their costs

 

Are there penalties or cancellation fees?

NO! We want to earn your business every month.

What credit cards can I accept?
We support all major credit cards, including Visa, MasterCard, American Express, Diner’s Club, Discover, JCB, and POS/ATM debit cards. We also support private label cards, including gift cards and loyalty programs.
Can I accept debit cards?
Yes!
How are my monthly fees paid?
We offer two options a daily and monthly options. The most common method is monthly, and fees are automatically debited from your business checking account the 1st week of each month for the previous month’s fees.
What are my monthly fees?
Interchange Pass-thru is the most economical method to process. If you have been processing with a three or four-tiered system (e.g., Qualified, Mid Qualified, and Non- Qualified rates), you should see an immediate cost reduction. You pay the cost of the card type, which is posted and updated on the internet by Visa and MasterCard, along with a very modest margin. We carefully explain your monthly fees before you sign any agreement.
How long does it take to set up a merchant account?
Within the first 24 hours, most merchant accounts are approved. However, not all merchant accounts are straight forward; some may take additional time.
What hardware do I need to accept credit cards?
We offer many options in our online store.
Do I need to reprogram my credit card terminal?
In many cases, you may be able to use the equipment you already own. We also offer swaps and trade-in for older hardware.
How will I get my money?
All funds are deposited via ACH into your bank account. SelectivePay offers the same day funding, next day funding, and regular funding.
Is there a customer support number that I can call?
Yes! Our 24/7 U.S.-based customer support team is always available. You will have live, toll-free merchant assistance.
What is the discount rate?
The discount rate is your fee for all the processing services that enable you to accept bankcards as payment. Our discount rates are extremely competitive.
Can I get my monthly statement online?
Absolutely! All SelectivePay clients have a secure online log-in they can use to view their credit card processing statements any time they want.
Why should I worry about PCI compliance?

PCI DSS standards exist to protect the security of your customers’ credit card data. These requirements are essential. If you ignore them, and your data is hacked or otherwise compromised, you face financial penalties that can put you out of business. So, PCI compliance is a must for all merchants.

What is a chargeback? Will it affect me?

When a cardholder disputes a transaction on an account, the bank where the credit card was issued puts the funds on hold until it can investigate. If investigators find fraud was involved in the transaction, the bank takes back the full amount PLUS a fee. While banks understand that mistakes happen, too many chargebacks indicate to them that the business may be operating in an untrustworthy fashion. Too many chargebacks can lead to a company going from low-risk rates to high-risk rates and fees. It can also prevent them from being able to accept credit card payments at all. Landing on the Terminated Merchant List (TML) can torpedo your business, mainly if you’re highly dependent on credit card purchases.

Can I avoid chargebacks?

There are several quick steps you can take to make sure customer payments aren’t disputed. First, make sure your business name and website name match. Put your phone number and other contact information on your receipts so that the customer will choose to call you first to get their money back. Consider direct refunds your friend, as they will keep the customer from calling their credit card issuer. Finally, always provide excellent customer service. This is the era of the customer. Do everything you can to keep him or her happy, even if it means losing money on a transaction. Do not stand on principle.

What is flat rate pricing?

Flat rate pricing for a merchant refers to a pricing model where a merchant (a business or service provider) charges a fixed, predetermined fee for a particular product or service, regardless of the actual cost or time involved in providing that product or service. This pricing approach simplifies the cost structure for both the merchant and the customer, as they know upfront what they will be charged, without any hidden fees or variable costs.

Here are a few key points to understand about flat rate pricing for merchants:

Predictability: Flat rate pricing offers predictability for customers, as they know exactly how much they will be charged, which can be particularly appealing for budget-conscious consumers.

Simplicity: It simplifies the pricing process for both the merchant and the customer. There’s no need for complex calculations or variable pricing based on usage or time spent on a service.

Transparency: Customers appreciate transparency in pricing. With flat-rate pricing, there are typically no surprises or hidden costs, making it easier for customers to make informed decisions.

Risk for Merchants: Merchants may need to carefully estimate their costs to ensure they don’t end up losing money if their costs exceed the flat rate they charge. However, if they accurately estimate costs and are efficient in their operations, they can enjoy higher profit margins.

Competitive Advantage: Flat rate pricing can be a competitive advantage in industries where pricing transparency and simplicity are valued. It can attract customers looking for straightforward pricing.

Examples: Flat rate pricing is commonly used in various industries, such as shipping (e.g., flat rate shipping boxes), web hosting (e.g., flat rate monthly hosting plans), cleaning services (e.g., flat rate for house cleaning), and subscription services (e.g., flat rate monthly fees for streaming services).

It’s important to note that flat rate pricing may not always be suitable for every business model or industry. Some businesses prefer to use other pricing strategies, such as tiered pricing, hourly rates, or variable pricing based on usage or customization. The choice of pricing strategy depends on factors such as the nature of the business, customer expectations, and competitive dynamics in the market.

What is tiered pricing?

Tiered pricing, also known as bundled or qualified pricing, is a simplified pricing model where credit card processing fees are grouped into different tiers or categories based on the type of card being used for the transaction. These tiers typically include qualified, mid-qualified, and non-qualified rates.

Qualified Rate: This is the lowest tier and represents the best-case scenario. It applies to transactions where a customer uses a standard credit card with a low risk of fraud, and the transaction is processed in a specific way (e.g., swiped in person).

Mid-Qualified Rate: This rate applies to transactions that don’t meet all the criteria for the qualified rate. For example, if a transaction is keyed in rather than swiped, it might fall into this category.

Non-Qualified Rate: This is the highest rate and applies to transactions that have the highest risk, such as when a rewards card is used or when a transaction is not properly batched for settlement.

The problem with tiered pricing is that it can be opaque and complex, with many variables and potential hidden fees. Merchants may not always have a clear understanding of how their specific transactions are categorized, leading to unpredictability in processing costs.

WE DO NOT OFFER THIS PRICING TO OUR CLIENTS