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Flat fee processing is always going to be more expensive, unless the Independent Sales Organization chooses to lose money (like Amazon Register lost money[1]).

by posguy 10y ago

Flat fee processing is always going to be more expensive, unless the Independent Sales Organization chooses to lose money (like Amazon Register lost money[1]). Going over interchange should save you some money, there are a bevy of ISOs out there to choose from, and virtually all of them will be able to replace Stripe. Restricting what your customers can pay with, say only allowing Debit, or not accepting American Express, can also allow you to cut costs, albeit it reflects poorly on your business. 1 - http://fortune.com/2015/10/30/amazon-register-shutting-down/ http://fortune.com/2015/10/30/amazon-register-shutting-down/

beckah 10y ago
Thank you for your thorough response. What do you mean "by interchange" and do you know of any ISOs who process payments as an example? Most of what I find when researching is how to become an ISO, which seems like it has a very high initial upfront cost.
- posguy 10y ago
  Google is your friend[1], and yes, I do know many ISOs and I have a relationship with one, but I'm not looking to delve into that. BTW becoming an ISO is not what you should be looking for, a small ISO has a run rate of $2 or $3 billion a month in processed transactions. 1 - https://usa.visa.com/dam/VCOM/download/merchants/visa-usa-interchange-reimbursement-fees-2016-april.pdf https://usa.visa.com/dam/VCOM/download/merchants/visa-usa-in...
  - beckah 10y ago
    That's not what I mean. Which ISOs are out there that can replace Stripe? I've looked and the only thing I've found are guides on how to become one rather than ISOs that are offering their services.
- pakitan 10y ago
  Interchange is the fee that card companies charge for every payment. That's something you have no way of avoiding. It hovers around 2-3% for credit cards and less for debit cards. Usually the most cost effective way to process card payments is to get a merchant account and to ask for a "interchange plus" rate. For example, interchange + 1% means the bank will charge you 1% on top of their cost (interchange). The 1% part is negotiable, the interchange is not. Note that Stripe functions as a merchant account + payment gateway. And the bigger part of the fee you're paying is used to cover the interchange fees. You can easily find a payment gateway for a flat fee like under $100/month but you still need a merchant account and you'll still be paying a % of every payment. And in your case it will be harder to get a merchant account as you're processing payments for multiple businesses, not just one. Unless you're processing a really large volume, my guess is that it's unlikely you'll get a better deal than Stripe.

by posguy 10y ago

beckah 10y ago

Thank you for your thorough response. What do you mean "by interchange" and do you know of any ISOs who process payments as an example? Most of what I find when researching is how to become an ISO, which seems like it has a very high initial upfront cost.

posguy 10y ago
Google is your friend[1], and yes, I do know many ISOs and I have a relationship with one, but I'm not looking to delve into that. BTW becoming an ISO is not what you should be looking for, a small ISO has a run rate of $2 or $3 billion a month in processed transactions. 1 - https://usa.visa.com/dam/VCOM/download/merchants/visa-usa-interchange-reimbursement-fees-2016-april.pdf https://usa.visa.com/dam/VCOM/download/merchants/visa-usa-in...
- beckah 10y ago
  That's not what I mean. Which ISOs are out there that can replace Stripe? I've looked and the only thing I've found are guides on how to become one rather than ISOs that are offering their services.
pakitan 10y ago
Interchange is the fee that card companies charge for every payment. That's something you have no way of avoiding. It hovers around 2-3% for credit cards and less for debit cards. Usually the most cost effective way to process card payments is to get a merchant account and to ask for a "interchange plus" rate. For example, interchange + 1% means the bank will charge you 1% on top of their cost (interchange). The 1% part is negotiable, the interchange is not. Note that Stripe functions as a merchant account + payment gateway. And the bigger part of the fee you're paying is used to cover the interchange fees. You can easily find a payment gateway for a flat fee like under $100/month but you still need a merchant account and you'll still be paying a % of every payment. And in your case it will be harder to get a merchant account as you're processing payments for multiple businesses, not just one. Unless you're processing a really large volume, my guess is that it's unlikely you'll get a better deal than Stripe.