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Dirty Tricks: Rising Credit Card Junk Fees

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I get the daily calls of wanting me to switch CC processors and with MUCH (misplaced) confidence, I refused to have a discussion with any of these guys, because I already had great rates.   Then, I had a persistent one call me back and ask why I didn't want to talk.  She said enough right things that I let the salesman come visit me.  

My rates were and supposedly were going to get better over time as I built up history.  Original Quote:

  • Credit Card Rate - 0.05% + Interchange (AMEX 0.055%)
  • Debit Card Rate - 0.05% + Interchange
  • Credit Transaction fee - 0.05 cents per transaction
  • Debit Transaction Fee - 0.05 cents per transaction
  • PCI Compliance-$9.95/monthly
  • Chargeback fee-$10.00 (VISA, MC, Discover) $30.00 (AMEX)
  • Paper Statement-$5.95 monthly (online statements free)

The other guy comes in and tells me that my current processor increased my rates and added numerous junk fees.    The rate raised to 0.25% for most cards and .75% for AMEX and now have a $34.95 platform fee and numerous other fees.   At this point, I stand to save $250/month minimum by switching CC vendors.     I did confirm that on day 1, my bills had way fewer fees.  The bills also stated that they were raising rates along the way, so they were disclosed and allowed by contract.  I'm halfway thru a 3 year contract with a $495 cancellation fee.   This is what I'm paying now with the same processor: 

  • Credit Card Rate - 0.25% + Interchange (AMEX 0.75%)
  • Debit Card Rate - 0.05% + Interchange
  • Credit Transaction fee - 0.05 cents per transaction
  • Debit Transaction Fee - 0.05 cents per transaction
  • PCI Compliance-$9.95/monthly
  • Annual PCI Audit Fee - $99
  • Chargeback fee-$10.00 (VISA, MC, Discover) $30.00 (AMEX)
  • Paper Statement-$5.95 monthly (online statements free)
  • New Junk Fees - $41
  • To be clear, the interchange fees don't change on either deal.  We are only dealing with CC processor markup fees and junk fees.   The 0.05% is a markup fee over interchange.   

The new deal is:

  • Credit Card Rate - 0.05% + Interchange (all cards including AMEX)
  • Debit Card Rate - 0.00% + Interchange
  • Credit Transaction fee - 0.05 cents per transaction
  • Debit Transaction Fee - 0.05 cents per transaction
  • PCI Compliance - $0 (with a successful audit and $9.95/month penalty without one)
  • Annual PCI audit fee - ??
  • Chargeback fees - $25.00 (VISA, MC, Discover, AMEX) - refundable if you win
  • Monthly Charge - $10.00

As best I can tell, it looks legitimate.   I'll be carefully reading the new contract tomorrow.   So, the real question is whether or not I'm switching from one liar to another liar?     This second one is telling me that my contract will have the rates guaranteed and locked in.   If I see the right things in writing, I'll be switching.  Will recoup my cancellation / startup costs in 3 months.

I guess the moral is get an annual checkup from a competitor. 

Supposedly these rates are available as a result of being low-risk from my transaction history (or it's just marketing-speak).  I don't know.    My original deal was reasonable, but it isn't any longer.   My plans were to wait for the 3 year contract to end before shopping around.

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