In today’s business world, managing finances is the very basis of success. QuickBooks tool hub offers an integrated credit card processing system as part of its accounting management software, making it easier for businessmen to execute financial transactions. It is, however crucial to know the related fees in using the product for effective financial management. Here is an in-depth discussion of QuickBooks credit card processing fees to guide you in making the appropriate decisions related to your business’s finances.
What is QuickBooks Credit Card Processing?
Businesses can process payments straight from the QuickBooks account through QuickBooks credit card processing. In a nutshell, it is an integration mechanism that simplifies the whole payment process by integrating sales data and financial records into a single system. There are many credit card processing options available in QuickBooks, including QuickBooks Payments and third-party connections.
Types of Fees
QuickBooks credit card processing charges you several types of fees. Knowing about them will help you manage the costs and find ways of optimizing your payment processing strategy.
1. Transaction Fees
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Percentage of Sale: This is a percentage charge on each sales amount. QuickBooks Payments percentage rate ranges between 2.6% and 3.5% for swiped or tapped transactions. For keyed-in transactions, the percentage rate reaches 3.4% + 25¢. The percentage rates above depend on how many employees are in your business and how many sales.
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Fixed Fee per Transaction: In addition to the percentage fee, there generally is a fixed fee per transaction of around 25¢. This fee is charged for every transaction QuickBooks Payments processes.
2. Monthly Fees
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Service Charges: Just as with monthly fees, QuickBooks Payments does not have a monthly fee for basic services. Advanced features or premium plans may still charge a monthly fee. These might be advanced reporting features and higher fraud protection.
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Account Maintenance Fees: At times, you may be levied with fees to maintain your account or service level although this is less likely to happen when using QuickBooks.
3. Chargeback Fees
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When a customer complains about an erroneous charge and files a chargeback, the business might have to pay QuickBooks a fee if it has to handle a chargeback. Chargeback fees commonly range between $15 for every chargeback.
4. Refund Fees
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The fee is usually a percentage of the value refunded when the company returns a QuickBooks reversed transaction.
5. International Transaction Fees
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If you accept international payments, there may also be additional fees that apply. These are usually a percentage of the transaction amount and include fees for currency conversion and cross-border transactions.
6. PCI Compliance Fees
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Credit card transactions to be paid by businesses need to pass the checks to be PCI DSS compliant. Some charge a PCI compliance fee on the part of the processor but QuickBooks Payments usually absorbs that into their service and does not pass it along as an extra cost.
Factors Affecting Fees
Several factors will influence the fees when using QuickBooks for credit card processing:
Transaction Volumes and Value:
1. Higher dollar
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Volumes or numbers of transactions can earn you lower processing rates. QuickBooks frequently offers volume-tier pricing.
2. Card Type
Processing rates are also affected by the type of card, debit, credit, and even rewards cards all have different processing rates. Processing fees are quite a bit more for corporate or credit cards that have rewards.
3. Type of Transaction
Swiped or tapped transactions often come with lower fees than keyed-in transactions. This is because keyed-in transactions are riskier; therefore, there’s a possibility that frauds may occur so higher fees might be required to account for the possible frauds.
4. Business Type
Depending on the type of business you have, it may also affect your processing fees. For example, businesses that fall under higher-risk industries may cost more than low-risk businesses.
How to manage and reduce Processing Fees
To aid you in making full use of the benefits in terms of credit card processing from QuickBooks, here are some strategies that can work well for you:
Negotiate Rates
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Then, if you process a very large volume of transactions, you can use your leverage to bargain with QuickBooks to get better rates and perhaps use this leverage to seek an alternative processor.
Send Customers to Swipe/Customer Swipe
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Swiping/tapping will save you from extra transaction fees.
3. Protect Yourself from Chargebacks
Your business can put in good fraud prevention features so you do not incur unnecessary chargebacks. Chargebacks are accompanied by additional fees.
4. Check Statements Regularly
Review your statements regularly for errors. You should also know how fees are structured and avoid overpaying.
5. Bundle of Services
QuickBooks offers several packages and services. For purposes of this section, you should consider whether combining payment processing with one or more QuickBooks services could help save you money or provide other benefits.
Conclusion
Effective management requires a clear understanding of credit card processing fees in QuickBooks. By understanding these various types of fees and the factors affecting them, along with strategies for managing and cutting costs, informed decisions can be made for your business. Monitoring your processing statements from time to time and keeping track of industry trends may further help in effectively managing credit card processing costs. The convenience of handling your transactions QuickBooks offers is unbeatable; however, becoming proactive in terms of the fees is the best way to ensure you get the maximum value the service has to offer your business.