1. The carholder purchases goods or services from the merchant.

2. Your credit card system dials the processor who in turn contacts the bank that issued the card to your customer. The bank that issued the card to your customer approves or declines the charge.

3. Tour terminal "captures" the information on the credit card.

4. You settle you batch at the end of your day.

5. Our bank will "ACH" (Automatic Clearing House) wire transfer the sale less the bankcard interchange rate (percentage) and the transaction fee (costs associated with the back and forth calling over the various networks) into your bank within 24 - 48 hours.

What are all of those different Visa & Mastercard rates on my statement?

Did you know that Visa and Mastercard have over 50 different interchange rates (fees) attached to different cards prsented to different merchant types around the country? This very complex and sometimes confusing structure is vastly different than, for example, American Express or Diners Club which may have one fee for all treansaction types at your store. Listed below are the most typical breakdowns on your monthly statement that you will run across with some associated explanations. The following list is by no means exhaustive, and your POS representative can go into further details with you.

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Qualified Rate - Your lowest rate. Face to face transactions with card presented, swipes through your terminal and signed by the card holder (sometimes signified by CPS Retail Credit (V) or Merit 3 (MC).

Mid Rate - A surcharge of interchange added to your basic qualified rate. Typically occurs on hand or key entered transactions, or over the phone mail order/ telephone orders. Happens because key data from cardholders magnetic stripe was not transmitted to Visa/Mastyercard (sometimes signified as CPS Card Not Present (V) Merit 1/Moto (MC) These surcharges are also attached to corporate Mastercard transactions.

Non Qualified - The highest rate you pay. A surcharge added to the qualified rate. Visa business card transactions Eirf(V) . Although it is rare it occurs primarily through use of overseas issued bank cards (out of country network calls), Visa Business Cards, or someone at your place of business forgot to send a batch for more than 48 hours (signified as Standard V/MC).

Remember whatever rate you pay will always be made up of two components - An interchange rate and a transaction fee. This can be shown in two ways: Bundled-one number or Unbundled-Both costs shown. These costs are one of the same as they relate to your average ticket(sale).