Twice a year, the card brands issue pricing adjustments to their Interchange Rates. All of these rates are available for your review at their individual sites. Due to Covid-19, the usual fall pricing adjustments in 2020, were delayed. Now, spring is just around the corner, which means it is once again time for pricing changes from the Card Associations. Since previous adjustments (translated as “increases”) were delayed, these changes are more substantial than is typical.
These upward adjustments will have an impact on any and all merchants accepting plastic as a form or payment. The rate increases will vary by card type and how your transactions are processed whether it be in person, online or card-not-present. This, of course, couldn’t come at a worse time. We have seen so many businesses that have had to close their doors, either permanently or, at the very least, have seen revenues dramatically reduced due to various lock downs across the country. Now, it seems, like things are finally starting to loosen up a bit and we are beginning to see businesses reopening even if it is at reduced hours or capacities as mandated by federal, state or local entities.
So, what’s a business owner supposed to do? At the very least, take the time to dig into your current merchant services and get a complete and thorough understanding of exactly what you are paying for. This is one of the most significant cost centers in your business and you absolutely need to stay on top of it and keep your rates under control as much as you are able. Then, when the customers start flowing back to you, more of those revenues will go to your bottom line and not to the service provider. There are also technological and methodical advances that have been developed recently, that should also be explored, for increasing revenues.
Hopefully, your merchant services rep is one that truly values the relationship and is not just interested in the commissions earned. They should be on top of these interchange increases and proactively contacting you to alert you and make recommendations that will be to your benefit.
Let’s all pray that we can see that our country can get back to some form of normalcy as the year progresses. We live in the greatest nation on earth and this has been a tough past twelve months but together, we can come back strong.