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About BAG Payments

The first thing BAG Payments will do for you is find out what you want to accomplish by switching your payment provider. When we ask businesses what there biggest issue is with accepting credit and debit cards, the number one answer is "the merchant service fees".

I think it is good to understand who is charging what and who is collecting what fee and how much. It is probably not what you think.

  • Card Brands (Visa, MC, Disc, and Amex): collect about 15% of your fee through "Assessments and Dues". This segment is growing steadily.

  • Card Issuing Banks: collects the lion's share of the fees at about 70%. This is the part of the merchant fees that is out of control but cannot be negotiated accept in special situations (Levels 2 and 3). This is an non-regulated industry making its own rules without any oversight and forcing businesses to abide by their rules that are not part of the laws of the USA.

  • Card Processors and Sales Organizations: collect the remaining 15% [and this is shrinking]. These are the people trying to get you to switch your payment providers. Each Independent Sales Organization (ISO) represents one of the 6 major credit card processors in the USA. 

As you can see, when you are upset about the cost of your merchant service fees, it is set up to where you cannot really negotiate a great deal of savings since the Interchange, Assessments and Dues cannot be negotiated for lower cost unless you are a large superstore. So when a person comes in and tells you that they are going to save you money on your fees, traditionally it will not be much and it will go back up.

So, how do you control your merchant service fees? There are 4-proven methods and each has its place. Two of these require the business to be under the Card Brands compliances and two do not. This is the part of the consultation where BAG will help in finding the best method for you to completely eradicate your expense of merchant service fees. We will explain and you will decide for your business. 

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