Invoice2go Credit Card Fees
Ilene Dycus
Ultimately, your merchant account fees are determined by your merchant account provider. But the credit card issuer and credit card network both play a major role in the final amount of money you pay during the transaction. This setup means that rather than pay a flat fee, it's possible to see a range of transaction fees on your monthly statement.
Adding to the confusion is the terminology used to refer to these credit card processing fees. You may see them listed as "merchant account fees" or even "discount rate." Don't let the name fool you. Your discount rate simply refers to the amount of the sale that goes toward paying credit card processing fees.
How much can you expect to spend on credit card processing fees, on average? The exact percentage can vary due to a range of factors, but processing fees usually range from 1.5% to 3.5% per transaction. The payment processor will usually have an additional fee on top of this percentage.
Interchange fees go to the bank that issued the credit card. The interchange fee will typically make up the bulk of the transaction cost. Interchange fees are usually presented as a percentage, plus a fixed amount.
Finally, there are fees you pay to your payment processor. As a business owner, you don't have a lot of influence over the other fees you pay, but you have options when it comes to your merchant service provider. Here are the four main pricing models available from most payment processors:
Flat-rate pricing provides merchants with predictable monthly costs, but it also means less flexibility. For example, it's possible to expand your sales volume to lower your interchange fees. But with a flat-rate model, you'll be locked into the same price indefinitely.
But looks can be deceiving. Frequently, the lower tiers are reserved for certain types of credit and debit cards, which means that merchants may find themselves defaulting to higher-priced tiers. Rewards cards, for example, will almost invariably fall into a higher tier. You'll need to decide what types of cards you'll be regularly taking before you choose a specific pricing plan.
Interchange plus pricing offers a similar benefit to the flat-rate pricing model in that you'll have some predictability over the processing fees. But you'll also receive the lowest possible interchange fees, though these fees can vary widely.
Finally, your merchant account provider may offer a subscription rate, also known as membership pricing. In this model, you'll pay your payment processor a monthly fee to cover the cost of your membership, as well as a fixed fee for each transaction.
This pricing model works best for those with enough credit or debit card transactions to see the benefit. Low-volume business owners may find themselves paying more in monthly fees than their actual transaction fees.
Fortunately, these fees are usually not recurring, though they can add to the total cost of your payment processing platform. Make sure to leave some room in your budget to cover the cost of things like setup, installation, and the rental/purchase of equipment.
Payment networks charge different interchange rates based on your merchant category code or MCC. Your MCC corresponds to your business type. This setup means that a retail store will pay a different interchange fee than a grocery store or other type of business.
You've probably already noticed that credit cards vary widely, even within their respective networks. Rewards cards promise their users cashback or points toward a vacation, but for the merchant, this translates into higher interchange fees.
On the one hand, credit card processing fees are the cost of doing business in an increasingly cash-free society. On the other hand, these processing costs can really add up. In 2019, small businesses spent a total of $116 billion in processing fees alone.
This approach sounds easier said than done, but most credit card processors will communicate the fees they charge for things like account maintenance, equipment rental, and more. Some even charge a monthly minimum fee regardless of your sales volume.
What are chargeback fees? A chargeback fee occurs when a customer disputes a charge. Usually, the customer will contact the credit card company directly, claiming they did not make the purchase. When credit card companies accept the chargeback, merchants will have to pay a fee, which can be hefty.
How can you avoid these fees? Take a look at the way you process transactions. You're less likely to receive these fees when the customer pays using a card reader with chip protection or contactless methods. When possible, avoid payment methods where the credit card is not physically present.
Finally, think about the rate at which you typically process credit card payments. Subscription pricing makes a lot of sense for businesses that see a lot of sales volume, reducing the average transaction cost. But be cautious.
If you aren't making a lot of individual transactions, you could be paying more in monthly fees than in the other credit card processing fees associated with other plans. Look at the pricing options offered by your merchant service provider, and decide on which best fits your business.
Invoice2go is changing the way business owners process credit card transactions. With our simple payment platform, your clients can submit online payments using their credit card, debit card, or even PayPal.
Arguably the most essential aspect of a business is getting paid for a product or service. As any busy entrepreneur knows, however, invoicing often gets overlooked in the ever-growing list of to-do tasks. This is why a proper invoicing software system is crucial. With a number of invoicing apps on the market, business owners can create, send and organize invoices from their smartphones.
Its website states that 225,000 small businesses in over 160 countries have used Invoice2go. The invoicing tool works best for microbusinesses, sole proprietors and freelancers who have a low volume of monthly invoices and are just looking for an easy-to-use invoicing service.
Invoicing: Users can choose from a selection of pre-made invoice templates or customize their own invoice by simply dragging and dropping their company logo, choosing brand colors and switching fonts. Expense items, photos, comments and payment details can all be added to the invoice. In addition to email, users can send invoices through Facebook Messenger, WhatsApp and SMS.
While Invoice2go provides a quick, easy invoicing system, it does not provide much else. Businesses looking for accounting services beyond asking for and receiving money will not find that with Invoice2go.
There are several invoicing software options on the market, so it is a good idea to research how each one stacks up with your business needs. While Zoho Invoice, Square Invoices and Invoice2go all rank highly for features, Zoho Invoice ranked highest among the three for value for money.
Invoice2go is perfect for a small business, entrepreneur or freelance contractor who does not have a high volume of invoices to send per month. The ease of use and high-quality mobile app makes it a perfect match for busy users who are constantly on the go and looking for a simple invoicing tool.
Like most types of software, the best invoicing software programs offer many levels of security. When choosing this type of software, you want to look for security features like two-factor authentication (2FA) or multifactor authentication (MFA), documentation that shows frequent security updates and patches, intrusion detection, the monitoring of user activities, data encryption and privacy protection.
Invoice2go has three plans. Credit card processing fees on the Starter plan are 3.5%. The Professional plan offers a lower credit card processing fee of 3%. And its Premium plan has an even lower credit card processing fee of 2.9%. Read our guide to learn more about credit card processing fees.
If you get stuck or need a few pointers, you can access tons of tips with over 5,000 community members in our exclusive Slack group, a wealth of guidance in our online forums, or you can send us a quick message for support from the Invoice Ninja team.
We set out to make business invoicing stress-free and seamless, combining advanced software features and security with transparent pricing, amazing service, and all the tools you need. Our pricing plans are varied and scalable, starting with a zero-cost option for up to twenty clients, unlimited invoicing, four templates, branded documents, and auto-billing functionality.
As part of the Invoice Ninja Enterprise plan you can create additional account users, set permissions of what additional account users can view/create/edit, and receive notifications for actions taken by users!
With Make you can connect Invoice Ninja to your favorite apps & services. Just create a scenario that will watch for new data being created in a specified app and it will automatically trigger actions in Invoice Ninja, or vice-versa!
The Invoice Ninja Pro Plan allows you to create custom email reminders based on the invoice date or invoice due date. Define date parameters to remind your clients before or after invoices are due to ensure you GET PAID!
The Invoice Ninja Pro Plans allows you to create custom invoice number sequencing for invoices, quotations, payments, and clients by using dozens of available dynamic variables provided in your account!
Looking to motivate clients to pay on-time? Set up invoice late fees that apply automatically when invoices pass their due dates. You can set up late fees as a percentage % of the invoice or as a flat $$$ value.
Show different company logos & contact details to different client groups, configure different payment terms to different client groups, use different languages to different client groups, many use cases!