The United States is less than 5 percent of the global population, but we own nearly 25 percent of all credit and debit cards in circulation. Needless to say, Americans love shopping with plastic — whether it’s debit versus credit, PIN versus signature, or chip versus magstripe.
Though with so many card types available, the options can be overwhelming. In what way are these cards similar, and how do they differ from one another?
When businesses decide to accept credit cards, they typically sign up for a merchant account that automatically bundles Visa, MasterCard and Discover together. The rates are reasonable, and competition amongst merchant account solutions provides plenty of payment processing options.
However, American Express (AXP) is usually a closed ecosystem, with many smaller merchants getting priced out of the relatively high rates that American Express charges.
Any time you begin accepting credit cards within your business, you can expect to pay certain fees. These charges can sometimes become complicated. Though the more you understand how card processing fees work, the better positioned you are to negotiate better rates or dispute unnecessary charges.
The following is a breakdown of the most common credit card processing fees in the industry:
Convenient and reliable, credit cards are one of the most popular payment options in the retail world. In fact, Americans love using their plastic so much that they’re responsible for nearly 25 percent of all debit and credit cards in the world.
Yet, are you ever better off using cash instead?
It depends on which side of the transaction you're on.
As a consumer, credit is usually the preferred choice: