So you signed up with a big fitness and wellness software company and got this amazing 1.69% payment processing rate — or did you? The sad unfortunate truth? You were duped. Don’t take it too badly. They use the same smoke and mirror tactics that the banks and credit card processors have been using for decades.
Here’s how it works:
Step 1: Wave a bright shiny object in one hand such as “1.69% Qualified Rate” in big bold print.
Step 2: While distracted by the shiny object, put their other hand in your pocket and pull out the rest of your fees. This is done with several time tested psychological advertising approaches
- Small Print: The other fees and rates listed are shown in smaller print inferring less importance and receiving less consideration
- Omissions: Some fees are not mentioned at all (e.g. surcharges for Amex transactions and amount of PCI fee) leaving you to learn about these only later when you receive your statement… except for the fact that the monthly statement is nearly unreadable.
- Jargon: They throw around terms like “qualified”, “mid-qualified”, and “non-qualified” as if everybody knows exactly what they mean and it’s no big deal. Each processor has a different arcane methodology to determine what this means and how much they will charge you.
- Monthly / Quarterly: Breaking out fees into small monthly or quarterly amounts makes them seem inconsequential.
Step 3: Make your monthly statement almost completely unreadable and non-sensical so that you never figure out their ruse.
Do yourself a favor and take a very close look at your statement. And if you want to know how much your paying? It’s simple. Add up the total $ that you processed over the course of 3 months. Then add up all the fees charged for everything during the same period. Divide the fees by the amount processed and this is your actual RATE. Don’t be surprised if it is almost double what you thought your rate was.