The Smart Zero Cost Merchant Processing Solution

FAQs

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  Zero Fee Credit Card Processing vs. Surcharging

  While many credit card processors promote “no-fee” solutions, these are essentially just a form of surcharging. AllayPay, like other providers, helps businesses pass the credit card processing fees directly to customers at the point of sale.
  The fundamental difference between traditional processing and surcharging is who pays the fees. In traditional models, the merchant covers the cost. In surcharging, the customer does.

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  How Does No-Fee Credit Card Processing Work?

  To make no-fee credit card processing functional, AllayPay programs the point-of-sale (POS) systems to automatically apply a surcharge to credit card transactions. The surcharge typically ranges between 2% and 4%, depending on state laws. For example, if a customer buys a $100 item and a 3% surcharge applies, the customer would pay $103.
  It’s important to note that debit card transactions cannot be surcharged. Only credit card transactions qualify under most state laws.

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  What Other Credit Card Processing Costs Exist?

  While surcharging allows merchants to pass credit card fees onto customers, AllayPay advises that there are still potential costs to consider, such as:

  • Monthly service fees
  • PCI compliance fees
  • Equipment costs
  • Chargeback fees

  It’s essential to review all potential fees and understand the complete cost structure before opting into no-fee processing.

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  What to Look for in a No-Fee Credit Card Processor

  Before selecting a no-fee processor, merchants should look for:

  • Transparent pricing: Ensure you’re aware of any hidden fees.
  • POS system compatibility: Confirm that the processor’s systems work with your existing setup or be prepared for potential equipment costs.
  • Surcharge regulations: Be sure that the processor, like AllayPay, understands the rules specific to your state.
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  Which Businesses Benefit Most From No-Fee Credit Card Processing?

  Not every business will find surcharging to be the best option. However, it can be a game-changer for:

  • High-risk merchants: Businesses with irregular sales volumes or in high-risk industries often benefit from minimizing fees where possible.
  • Small businesses: Independent cafes, retailers, and market sellers might pass fees onto customers with little resistance.
  • Enterprise businesses: Companies processing large volumes of credit cards, especially business credit cards with high fees, can significantly reduce their expenses.
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  Convenience Fee vs Dual Pricing?

  A convenience fee is an additional charge added to a transaction when a customer uses an alternative payment method that isn’t typically accepted by the business for a particular type of transaction. Dual pricing refers to a pricing model where a business offers two prices for the same product or service: one price for customers paying with cash and another, higher price for customers using credit or debit cards. The difference in price accounts for the merchant’s card processing fees, without charging a separate fee as seen with surcharges or convenience fees. Learn more

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  Legal Considerations

  Although no-fee processing is legal in most states, there are still some where surcharging is prohibited or heavily regulated. As of this writing, surcharging is banned in:

  • Connecticut
  • Massachusetts
  • Additionally, states like California, Florida, Kansas, Maine, New York, and Texas have varying surcharging laws. AllayPay can help merchants navigate these legal intricacies to ensure compliance.