Looking to Process Credit Cards Online for Free? What Businesses Should Know

Ecommerce solutions allow businesses to accept credit and debit cards in their online stores. Internet merchant accounts give those businesses the resources to process payments through a credit card processor, as well as to acquire the POS (point of sale) infrastructure to swipe cards in person.

Many businesses have experienced a higher volume of transactions due to products and services having moved an online during the COVID-19 lockdowns.  Of course, merchants that process more credit card sales may end up paying more in credit card processing fees so, understandably, many of these businesses have started searching for a “free” credit card processing solution, in the hopes they can stop paying any fees, altogether. 

Startup Fees vs Transaction Fees: What’s the Difference?

Two common types of fees associated with accepting credit card payments online are startup fees and transaction fees. It is important for businesses to know the difference between these kinds of fees when trying to process credit cards online. Processing credit cards online through an internet merchant account is never going to be completely “free,” because the credit card companies charge credit card processors wholesale costs for facilitating transactions, called Interchange fees, and these expenses must be recouped. However, there are ways to lower costs.

For example, some merchant account providers charge startup fees such as application fees and setup fees. Some merchant account providers nowadays will absorb the expenses involved with setting up a new account and will lower or forgo these fees in order to encourage merchants use their merchant account services. This practice, first pioneered 25 years ago by Charge.com has become increasingly common because other companies have started to follow Charge.com’s lead.

Ultimately, the merchant account products and services can’t be completely free, however. Otherwise, they wouldn’t be offered. Transaction fees are the portion of each transaction that businesses pay their merchant account provider whenever they process one of their customers’ credit cards, debit cards, or other forms of eCommerce payment. This includes instances where a business accepts credit cards on cellphones as well. (Many merchant account providers offer services to do so, which is worth looking into.)

These transactions or processing fees are extremely affordable with the right online merchant account provider. They are not totally avoidable, however, or else merchant account providers would be paying for you to use their services. Ultimately, this means that businesses that want to process credit cards online for free (with literally zero out of pocket cost) may be out of luck. But those that want to accept credit cards on cellphones or in their online store should be happy to know that startup fees are not always an issue as some companies now routinely waive these fees. But, even then, the transaction-related fees will always be there in some form.

The Takeaway

Businesses are experiencing greater transaction volume now than ever before because of the quarantine. There is pressure on their online stores to process transactions securely. Many businesses are naturally wondering if they can process credit cards online for free, in addition to accepting credit cards on cellphones.

Even though payment processing is never completely “free,” startup costs like application fees, setup fees, and activation fees can be avoided if businesses pick the right internet merchant account provider. Visit Charge.com or call (888) 924-2743 to find internet merchant account products and services that reduce costs to businesses while still providing the updated POS systems that are essential for face-to-face businesses.

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