fbpx
Connect with us
Become A Crypto Expert

Executive Voice

John Shin: Outrageous Credit Card Processing Fees, Unknown To Business Owners – Learn The Truth About Excessive Credit Card Fees

In the digital age, credit card fees are nearly impossible to avoid. However, an understanding of the fees and options can save business owners and merchants thousands of dollars a year in transactional costs. At some point, every business owner must decide whether to use a tiered pricing model or an interchange cost-plus model. Unfortunately, many business owners don’t know the difference and will often be sold on tiered pricing, simply because the merchant didn’t know there were options. 

Before understanding which option is better, one must first understand the fees that apply in each model. It’s important to understand that the sale transaction extends far beyond the customer and the merchant. In reality, the credit card company, i.e visa or mastercard, takes a fee, the bank takes a fee, and independent sales organizations, known as ISO’s, such as Stripe, PayPal, or Square, also take a fee. 

With tier pricing, the most common model businesses use, there will be a base rate of 1.69% plus .20 cents per transaction plus a key-in/surcharge of .49-.99% and finally any business card fees. All said and done, the business owner will be stuck paying 3-6% on each transaction. Additional fees may be added if the customer pays with a credit card that rewards them with 5% cashback or other rewards. That 5% has to come from somewhere and rest assured the credit card companies aren’t paying it, so once again, the merchant is left to foot the bill. Other hidden fees include the statement fees, batch fees, access fees, merchant club membership fees, and dozens more. Sadly, many business owners simply assume that these fees are unavoidable and non-negotiable. 

Fortunately, there is another option. Interchange Cost Plus pricing accounts were historically only available to businesses with high volume sales, typically over $25,000. However that rule is a thing of the past, and now businesses of any size can access this Interchange Cost Plus transaction model. This pricing system is much simpler as well, with only two fees to take into account, the interchange cost, a flat fee that is paid to the bank and the independent sale organization, plus a small fee per transaction. For example, merchants could expect to pay 1.69% (the Interchange Cost paid to bank and ISO) plus a small markup of .25% plus a .10 cents transaction fee so that the total cost is 1.94% + $0.10. This can be an exceptional option for business owners, but only if they can find a competitive quote. 

Global Merchant Innovations, Inc. founded by Sir John Shin in 2006, has been in the financial industry since 1991, when he founded AXIANTA Financial Partners Inc., an independent financial service marketing company based out of Calabasas, California. When he became privy to his client’s merchant processing statements, he was stunned to realize the exorbitant amount of fees they were paying in credit card transactions each month. Global Merchants Innovations, Inc. (GMI) seeks to educate small businesses and start-up entities on their credit card processing options. According to Shin, “Many business owners simply don’t realize how much unnecessary fees they’re forking over each month, that is money that they’d be much better off investing.” 

Global Merchant Innovations, Inc. offers a competitive interchange rate (1.69%) and takes just .25% profit while most of their competitors make at least a 2% markup for their profit. For John Shin and his team, this model simply makes sense, at the end of the day they are a financial institution first and their top priority is equipping businesses with the strategies to reduce their expenses and increase the client’s overall cash flow. As a result, the strategies may grow their wealth. By offering this competitive rate, their clients typically have more funds to invest. That is not to say that clients are obligated to invest the surplus that Global Merchants Innovations, Inc. saves them. “We always do what is in the best interest of our clients,” Shin explains, “Some may choose to invest their newfound savings, while others will elect to put their savings towards paying off their debt. Whatever they choose to do with it, savings are savings, and we’re just happy to be able to have shown our clients their options.” 

Another big issue that small businesses face is outdated card reading terminals. If a terminal is more than 3 to 10 years old, it will not be capable of processing the new microchips that most credit cards are equipped with today. When a card with a chip is swiped in a terminal that cannot read chips, the merchant may be hit with double the fees. For a limited time, Global Merchant Innovations, Inc. is giving away free terminals to all new customers, when they partner with them. 

To learn more about the thousands of dollars you can save your business by switching to an Interchange Cost Plus model, visit www.globalmerchantinnovations.com to schedule a consultation. 

Sahil is a serial entrepreneur and branding specialist. He also serves as a real estate investor and business consultant. He presently serves as the owner of The Brand Castle - Specialist in Search Engine Optimization (SEO), Web Design & Development and more.

Advertisement Become A Crypto Expert

Join Disrupt Magazine

Become A Disrupt Contributor

Most Disruptive

Entrepreneurship7 months ago

Navy Veteran Davis Chris Takes the Music Industry by storm

In life, you need to break down anything that might be holding you back and change course if need be...

Entrepreneurship7 months ago

5 Disruptive Leaders Paving the Way in 2021

Where there is uncertainty, lies a whirlwind of opportunity. 2020 was the year that had entrepreneurs learn a great deal...

Politics1 year ago

Brock Pierce Wants To Disrupt The Two Party System And Be Your Next President

We don’t usually cover politics much here at Disrupt, but when Crypto billionaire and friend of the show, Brock Pierce...

Business1 year ago

John Mcafee – Predictions For The Future

John McAfee is a world-famous tech CEO, computer scientist, civil disobedience activist, privacy advocate, and pioneer of the commercial anti-virus...

Finance1 year ago

Gaby Wall Street – Teaching Latinas to Thrive During The Crisis

It’s no secret we are facing one of the most challenging financial times of the last few decades as we...

Entrepreneurship1 year ago

Tony Delgado – The #1 Entrepreneurship Movement In Puerto Rico

Puerto Rican online market is in constant progress. With many entrepreneurs who are coming here to start a business, it...

Entrepreneurship2 years ago

Elena Cardone – The 10X Ladies Conference Is Declaring 2020 The Decade For Women

The next ten years are meant for women to continue growing their potential and succeeding in multiple areas, including business....

Marketing2 years ago

How Josh Elizetxe Built Snow Into a $40 Million Dollar Business

There is nothing quite like an entrepreneur’s determination when starting a business. That’s my original quote by the way (pun...

Entrepreneurship2 years ago

How Jason Capital Became A Self Made Millionaire By 24

Have you ever wanted to earn the respect of everyone who ever looked down on you at some point in...

Entrepreneurship2 years ago

Sam Bakhtiar On His Way To A Quarter Billion

Dr. Saman Bakhtiar, who prefers being referred as Sam, lives in an 8200 square foot $5.2 million house, Sam is...

Trending

Copyright © 2020 Disrupt ™ Magazine - Disrupt is a Minority Owned Privately Held Company

Disrupt ™ is the voice of Latino entrepreneurs around the world. We are part of a global movement to increase diversity in the technology industry and we are focused on using entrepreneurship to grow new economies in underserved communities around the world. We enable millennials to become what they want to become in life by learning new skills and leveraging the power of the digital economy. We are living proof that all you need to succeed in this new economy is a landing page and a dream. Disrupt tells the stories of the world top entrepreneurs, developers, creators, and digital marketers and help empower them to teach others the skills they used to grow their careers, chase their passions and create financial freedom for themselves, their families, and their lives, all while living out their true purpose. We recognize the fact that most young people are opting to skip college in exchange for entrepreneurship and real-life experience. This Podcast was designed to give them a taste of that.