Wednesday, May 16, 2007

So, What Is The Exact Interchange Fee Anyway? (commentary:

In days, as millions of consumers read about - a division of 30 Minute Photos Etc., we face a dilemma. Profiles in the June editions of Reader's Digest and Women's Health Magazine explain the new business we invented for digitally protecting photo memories. What is unclear is one component: what are our electronic payment costs?

As entrepreneurs, we have a mandate to know what all expenses are and quickly choose which vendors to work with. One company, which we have been buying products from since 1990, seems to have become distant and their rates for packaging materials were way too high. So, we did a search and found another suppler with rates nearly half of the other company. After the order, we received two letters of appreciation; clearly, they wanted to earn our business.

As for the credit card companies, Visa® and MasterCard's® nearly 80% market domination is in a different league. Just as we can choose our partners and easily understand exactly what we are paying, as we prepare for this extensive media coverage on our company, we have all costs in check, except our interchange fees.

And, here is why: While the Visa and MasterCard links posted on their websites identify their merchant interchange fees, it is easy to understand why it is clouded, confusing and unfriendly. With the onslaught of new orders we are preparing for, it is anyone's guess what our payment interchanges fees will be.

[source: commentary -]