Higher Transaction Costs with Square

At first glance Square dropping it’s long standing pricing appears beneficial to merchants. Long story short, it will benefit some, hurt others with much higher cost per transaction prices. This is also a sign Square is searching for avenues to generate greater profits. Common thought process would be, “great… a price reduction from 2.75% down to 2.60%. What’s 10 cents, no big deal.” This analogy is common thought process until the numbers and true affects are shown in black & white side by side at various average transaction levels. See illustrations below how this “price drop” affects various merchants based on average transaction sizes. Whether cards are debit or credit makes no difference under this illustration due to determining cost based on average transaction sizes. Average transaction size clearly drives costs of card processing.

Average Transaction       Added 10 cents Cost Effect          New Processing Cost                   Old Cost vs New Cost

$5                                           200 basis points = 2.00%               2.60% + 2.00% = 4.60%                  2.75%   vs   4.60%

$10                                         100 basis points = 1.00%               2.60% + 1.00% = 3.60%             2.75%    vs  3.60%            

$15                                         67 basis points   = 0.67%                2.60% + 0.67% = 3.27%                  2.75%    vs   3.27%

$20                                         50 basis points   = 0.50%                2.60% + 0.50% = 3.10%                  2.75%   vs   3.10%

$25                                         40 basis points  =  0.40%                2.60% + 0.40% = 3.00%                  2.75%   vs   3.00%

$30                                         33 basis points  =  0.33%                2.60% + 0.33% = 2.99%                  2.75%   vs   2.99%

$35                                         29 basis points  =  0.29%                2.60% + 0.29% = 2.89%                  2.75%   vs   2.89%

$40                                         25 basis points  =  0.25%                2.60% + 0.25% = 2.85%                  2.75%   vs   2.85%

$45                                         22 basis points  =  0.22%                2.60% + 0.22% = 2.82%                  2.75%   vs   2.82%

$50                                         20 basis points  =  0.20%                2.60% + 0.20% = 2.80%                  2.75%   vs   2.80%

$55                                         18 basis points  =  0.18%                2.60% + 0.18% = 2.78%                  2.75%   vs   2.78%

As you can see above if your average transaction is $55 or below this new pricing affects your costs.

Where does your organization fit in?

How does this new pricing plan affect your bottom line?


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Apple Pay Accepted at MLB Ballparks

Apple Pay Accepted at MLB Ballparks

Our newest POS system hard at work. Appetize is bringing advanced technology to the big leagues! Now major league stadiums have access to EMV technologies which include “seat side”, ordering and pay in your stadium seat, technology. Can you imagine placing your concession stand order from your seat while enjoying your favorite sports team? Then a hospitality team member brings your refreshments right to your seat! Now you can, plus you can pay using your EMV enabled chip card from your seat too. See the most recent press release below and which big league stadiums have joined the ranks of Appetize.


Posted in: Technology

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Credit Processing Executives Charged In $30 Million Overbilling Scheme

Credit Processing Executives Charged In $30 Million Overbilling Scheme

Conducting business in professional, transparent and honest manner is not only great business philosophy, which truly creates customer partnerships, it also keeps “you” out of prison. Increased scrutiny of merchant services providers using misleading verbal statements, misleading proposals and worst of all, misleading analysis’ to dupe unsuspecting customers into to becoming buyers, is now forcing law enforcement and prosecutors to ramp up enforcement. As an industry professional I welcome this increased enforcement. Days of using boastful and misleading tactics are coming to an end. Greater scrutiny and prosecution will ensure this. Conducting yourself as a true professional is paramount.

We all too often see unprofessional, disgusting activity taking place where unsuspecting merchants are duped into doing business by “pie in the sky” promises of “lowest rates” and “smoke and mirrors” proposals. These tactics are often unveiled when the credit card processing statements show up full of little surprises. Sometimes it takes 2-3 or 4 months before all the surprises are aired, but they do eventually make their presence. Add this together with the words spoken by the associate plus other unannounced surprises you have the perfect storm and grounds for prosecution due to fraud. As industry professionals we are held to our words and presentations. We must be totally transparent and honest to a fault or face the consequences. Ignorance of the facts or lack of industry knowledge is not an excuse. As a professional you must take your responsibility seriously. Each and every one of us in an industry ambassador. We must learn the business through being highly trained and educated in our industry. We must also be well aware of associated laws before we venture out and face impending disaster. Read article below and see why this is ultimately so much more important today.

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