Forums: Discussions for entrepreneurs and small business.

Hi all,

I'm in the process of starting a website where people can sign up and create their own "stores" to sell their items.

Now it seems to me that the majority of credit card companies charge around 3% for this, with an additional $0.30 per transaction on top of that (roughly). Is there some kind of service that I am overlooking to avoid such high fees? We were only planning on charging customers 3% for OUR services, let alone the credit card fees. I have a hard time believe a site like Etsy is paying a credit card processing company 3% per sale. Any tips?

Thank

Get use to it. First, you're not Etsy so don't compare what you may pay to what they are paying... you are correct, it ain't the same rate. I don't know the average price of what you're selling, but consider using Paypal until you're making some money.

I worked for a merchant card company, and they soak you with the lease on the equipment, and they soak you on anything else that you do with them. They are almost as bad as the mob.

I can tell by your email that you don't really have a grasp on what you're doing, be careful. There are people waiting for people like you.

Harry, you indicate you are only going to cahrge your clients 3%.  Are you charging your fee based upon your clients sales?  That would suggest you are acting as an aggregator, which unless you are registered with Visa/MasterCard you are going down the wrong path.

As much as 3% may appear, the credit card companies and competing services (Authorize.net,Intuit, Square, Paypal and Venmo to name a few) are very good at what they do.  This is not where you want to supply your differentiator.  If you have products or services that enable sales, then let the money people make their fee and you make your money on the product or service.  We will see the transaction fees come down over time, but this is not your competitive advantage.

Dan

Not all credit card processors are like the mob. Pretty ignorant of a thing to say. Just as their are unfaithful spouses, there are also faithful ones. And 3% by the way is extremely high.

Credit card users should be very smart while they make payment through credit cards, they must know all the charges details of their credit cards. Consumers should never withdraw cash money from their credit card.

quickquid

Credit card is a great facility, but sometimes it can be risky, if you don’t use it smartly, sincerely. Generally credit card users make some mistakes like they withdraw cash money from their credit cards, in this situation credit card companies charge heavy and regular interest on cash withdrawal.
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