By: First Union
Big Changes Coming for Visa
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To move people away from using checks once and for all, Visa is planning a major overhaul as far as the fees charged to businesses when consumers use credit cards. That said, how the fees are changing is not all cut and dry. The rates charged will go up or consequently down depending on the business itself.
For example, eCommerce sites seem to be facing a rate increase. Whereas, sectors such as education and real estate could be seeing a decrease in credit card transaction fees.
Overall, the decrease and/or increase is only going to equate to a few cents per transaction. However, all of that can add up, and again, depending on which side you fall, this could be a very good or bad thing. Retailers estimate that yearly over 100 billion is spent on accepting credit card payments. And this figure is climbing, which is in part why Visa is instigating this change.
According to a document put out by Visa, the rate changes will take effect in April and October. In this way, they allow the processors more time to prepare for and institute the necessary changes on their end.
While Visa is currently not offering any more information, many have questioned whether or not Mastercard will follow suit. These, of course, comprise the two largest credit card companies in the world. Mastercard is not saying whether or not they will follow Visa's lead and adjust their interchange rates accordingly. This change will only apply to the published rates that Visa puts out. As far as the banks that make money on the swipe rates, they have the option to negotiate deals with retailers.
If your small business requires additional cash for an expansion project or just to tide you over during a slower sales season, we can help. First Union Lending offers a variety of fast and flexible loan programs. Call today!