Are all payment cards created equal? Is processing debit card payments the same as processing credit card payments? And when it comes to Mastercard or Visa, which brand has the most positive impact on payments? These are all questions business owners in the oil and propane industry are asking themselves. I’m here to help.
Debit vs credit… What’s the difference?
When a customer uses a debit card to complete their transaction with you, the customer is drawing on funds they have already deposited into their bank account. The transaction is then sent through a different computer network and the customer is charged a debit-specific rate for the transaction. When a customer uses a debit card, the payment doesn’t have to go through a processing network, saying you time and money. Plus, the door is closed to chargebacks.
Have you ever gone to pay a bill with a credit card and noticed there was an additional fee? This explanation should help you realize why. Having customers pay with a credit card is a pain and gets the big four card companies––Mastercard, Visa, American Express, and Discover––involved. If possible, give an incentive to your customers to pay with their debit card.
Mastercard vs Visa… What’s the difference?
Visa and Mastercard are the two largest payment processing networks in the world. They do not dispense credit cards directly to the public, but through member financial institutions like banks and credit unions.
Both Visa and Mastercard receive the majority of their revenue from service and data processing fees. The merchant is charged for each transaction that covers the cost of facilitating transactional information on the network.
Currently, the average credit card processing fee for MasterCard is 1.55%-2.66%. The average credit card processing fee for Visa is 1.43%-2.44%.
Keep in mind that the type of card your customer uses matters as well. Business credit cards tend to be the most expensive to process, followed by rewards and regular credit cards. Fees will vary if your customer pays online versus in person. Plus, fees for in-person transactions are lower.
The world of payment processing is complex. As a business owner, it can be incredibly difficult to keep up. That’s why I’m here to help. With my consultation services, I take care of the hard work for you to help put money back in your pocket. Visit my website to book a free consultation session today.
