Just because you can doesn’t always mean you should. In most cases, you can legally charge processing fees and surcharges. Doing so can take the sting out of your processing costs. But here’s the bottom line: nobody likes to see charges tacked on to a purchase. So how can merchants keep their processing costs from eating into their margins?

Processing fees are the most obvious, and visible means of passing your processing costs along to the consumer. There are two main strains of fees: surcharges and convenience fees. A surcharge applies to credit card transactions universally. Credit card associations usually prohibit them, as do many U.S. states (Colorado, Connecticut, Florida, Kansas, Maine, Massachusetts, New York, Oklahoma, and Texas). “Convenience fees” are a subset of surcharges tacked on by the merchant if a purchase is made by means they don’t normally accept, like bitcoin or payment by phone. Convenience fees are not prohibited like surcharges are. Both, however, cannot exceed the actual cost of credit card processing or 4%, whichever is lower.

Again, we don’t have to argue that an extra 4% will leave a bad taste in most customers’ mouth; they prefer to see the opposite: discounts, rebates and BOGO’s. And if the customer wants a refund, the surcharge has to be refunded as well, while you still pay the interchange fee. So passing the costs along is not all that effective.

Save more with Merchant Services

Perhaps the best way of mitigating your processing costs is to reduce them. You’re not getting out of your interchange fees. But you can choose your merchant services wisely. At ChargebackHelp, we found a way to save merchants on their gateway costs by creating Billapay. Billapay does not charge merchants for excessive declines. So look for merchants services like this that are looking out for your bottom line. Use your relationships with these services to your advantage and negotiate better rates with your processor or merchant bank.

Passing costs on to your customers is bad business and just plain lazy. The savings are out there my friends. Look past the easy way with surcharges and negotiate your costs down. Every little bit helps. If you’re looking to save money with your merchant services, ChargebackHelp can help you. So drop us a chat down on the right, shoot us an email, or go old-school and call us 1.800.975.9905. We specialize in getting merchants the processing solutions they seek.