Non-Qualified: I frequently get calls from merchants who say they were quoted one rate, but claim different rates are showing up on their statements. Unfortunately, merchants can experience a rate increase or surcharge because of the type of card your customers are using, such as sky miles cards and rewards cards. Another cause of increased processing costs is transactions being processed incorrectly by the merchant. How can merchants avoid being charged these surcharges and still qualify for the best rate possible?
First, it is important to understand the different types of transactions that can occur when running a credit card sale:
- Retail swiped account transactions will get a Qualified Discount Rate, which is the lowest rate possible. In this type of transaction the card holder is present, they are using a standard consumer credit card, and once the card is swiped the transaction is batched within 24 hours. If any of these criteria change, you could downgrade to a MID-Qualified or a Non-Qualified transaction, thus increasing your rate.
- A keyed transaction, or manually entered transaction, will get a MID-Qualified Rate. This can also occur if AVS (Address Verification Service) is not entered when the customer uses a rewards card, or if the transaction is not batched within 24 hours.
- A Non-Qualified transaction occurs when a card is key-entered with no AVS info, or if a Corporate, Government, or International Card is used.
If you are not able to swipe a card because you are using an online payment gateway, how can you also take advantage of better pricing? When processing a MOTO (Mail Order Telephone Order) or Ecommerce transaction make sure to do the following:
- Make sure all required AVS information is entered
- Set your payment gateway or terminal to batch or settle within 24 hours
- Enter an Order or Invoice number
- Make sure to enter the CVV2 number
Many different factors can determine the rate you are assessed on your transactions. If you know you are going to be taking card types that will typically fit into the Non-Qualified category described above, be smart when setting up your credit card processing account – make sure to find out what your Non-Qualified rate will be. Be sure to find out all the fees involved before signing on the dotted line.
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