Visa, MasterCard Add New Fees, Part 2

January 9, 2013

MasterCard Fees

MasterCard is also debuting new fees, but they won’t take effect until July 2012. One of those new fees MasterCard will introduce is a new Annual License and Registration Fee. MasterCard has also  announced  a new annual Type III Third Party Processor (TPP) Registration Fee to be collected beginning in July 2012. These fees will be calculated based on full year 2011 volume. For 2012 only, each of the new fees will be 50% of the total fee calculated because it covers only half of 2012 (July 1, 2012 – December 31, 2012). These fees will be passed through on a pro-rata basis. All acquired MasterCard credit and signature debit volume will be utilized to determine annual volume for both programs. PIN debit volume is excluded. In addition, MasterCard will introduce new Regulated debit small ticket debit and credit Interchange programs in April 2012.

Digital Transactions reports in this article that “Both fees will be volume based, but MasterCard will exclude PIN-debit volume in calculating it, an apparent effort to boost its PIN-debit service at the expense of Visa’s much-larger Interlink PIN-debit brand.” However, Digital Transactions notes that at this time “a company spokesperson refused to give details about upcoming price changes.” So the exact pricing is yet to be determined.

And What About Discover?

Discover’s plans aren’t quite as grandiose as Visa’s, but they do have some changes coming down the pike in 2012 also. Discover will introduce a US Commercial Large Ticket Interchange Program in 2012. Discover will also increase its assessment fee by .005%.

One of the bigger changes for Discover is that they are changing existing card present Interchange rates for transactions less than $15 for Express Service merchants (Local Commuter, Bus Lines, Toll & Bridge Fees, Restaurants, Fast Food Restaurants, News/Dealer Stands, Laundries-Family Community, Dry Cleaners, Quick Copy & Reproductions, Parking Lots/Garages, Car Washes, Motion Picture Theaters and Video Entertainment Rentals) and less than $25 for Taxi/Limos. The new Interchange will be percentage based and carry a $0.00 per transaction. These are changes to their interchange rates, as opposed to completely new added fees that Visa and MasterCard are devising.

What This Means for HMS Customers?

Host Merchant Services wants to assure its customers that it sticks by its guarantee. HMS will never increase their fees for their customers. HMS continues to offer the guaranteed lowest rate. And that rate is frozen. Unfortunately, Card Association Fees are new, and are not part of any current pricing model. They are also mandated and initiated by the credit card companies themselves — Visa, MasterCard and Discover. All processors everywhere will be adding them to their pricing structure. This is why The Official Merchant Services Blog is reporting on these changes. We keep you informed about all the latest developments in the payment processing industry. These new fees are the industry’s response to finance reform with the Durbin Amendment. But as we already told you in our in-depth analysis of the Durbin Amendment last year, Host Merchant Services customers will continue to receive the guaranteed lowest rates with our pricing plans.

Visa, MasterCard Add New Fees, Part 1

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