Bank Merchant Services

Bank Merchant Services

Top 3 Reasons Banks Charge The Most For Merchant Services

In this blog post we will outline the top three reasons a bank charges the most for merchant services. Also known as, credit card processing. No matter what type of business you have, this will affect your bottom line. Utah EZ Pay wants you to know the difference between doing business with a bank and a merchant service provider (MSP) for processing your credit and debit card transactions. Here in the post we will outline the difference between the two.

Should I Trust My Bank For Merchant Services?

As our team members over the years had visited with many business owners, we have noticed a trend. That is, many business owners feel a sense of security opening up a bank offered merchant service account thinking they will give them the best deal. However as we will review, that is far from the case.

Remember, banks are all about making money off of rates and fees. Yes this is also true for merchant service providers. However there is a big difference. Below we will showcase the difference between processing with a bank vs a merchant service provider.

Credit Card Logos. Bank Merchant Services

1 – Rates. Processing With A Bank VS a Merchant Service Provider.

A Bank – Rates: Lets tank about bank offered merchant services first. Most banks don’t own and or use their own merchant service company. They often use use a third party MSP instead to process card transactions for their customers. So having discovered this, we see that a bank in most situations are the middle man.

They are in a way reselling the cost to them for processing your business card transactions, adding fees on top as a way for them to make money. Then charging business owners more, over and above what they could be paying should a business owner process directly with a merchant service provider. So in short, most banks are just simply reselling and often rebranding merchant services.

A Merchant Service Provider – Rates: Now let’s discuss about a merchant service provider, also know as a credit card processing company and how they differ from a bank. Here is where the big difference comes in as opposed to running cards for your business through a bank to process your card transactions.

When running card transactions with an MSP you are cutting out the middleman that is reselling the services, yes the bank. Your transaction cost will drop a lot and you will notice your rates are much lower. Your total effective rate will drop. Business owners will have more money in their pocket as a result. You will also have more rate options to choose from.

# 1 Rates Offered Recap

A Bank

  • Most banks are not merchant service providers and are the middleman
  • They are reselling merchant services
  • Most if not all tellers and managers have no idea they are the middleman
  • You will pay the highness rates and fees with a bank
  • Limited rate offerings

A Merchant Service Provider

  • They are direct and eliminate the middleman
  • Not reselling merchant services
  • Most if not all MSP’s are well versed in their field
  • You will receive much better rates and fees
  • Will have several rate offerings such as, 0% dual pricing, as well as, tiered .39% for instance as well as interchange plus pricing

# 1 Rates Conclusion

90% of the time you will receive much better rates processing card transactions directly with a merchant service provider vs a bank.

2 – Equipment. Processing With A Bank VS a Merchant Service Provider.

Mobile Smart Terminal

A Bank – Processing Equipment: Banks have limited access to credit and debit card processing equipment. The 3rd party they use, the merchant service provider, gives them a few of the most popular types of processing equipment. They will only have the most popular credit and debit card processing equipment at a cost to them. If you need an innovative solution, banks will not offer this to their merchants (business owners). Since banks are using a 3rd party for processing equipment, they often charge more for rates to make up for this.

Consider this, the person at your bank are surrounded by other bankers. Not like the people in merchant services that are detected to that field and surrounded in processing equipment and lingo.

A Merchant Service Provider – Processing Equipment: Here is where a merchant service provider really stands out from what a bank offers it’s merchants. No matter what type of business an owner is running, they will certainly find an innovative solution to their needs. That is their job, every day.

Here you will find a wide variety of free offerings because this is what an MSP does for a living. From Smart terminals, to innovative POS systems and website e-Commerce solutions and options. This will result in lower rates and fees because unlike a bank, the merchant service provider buys equipment in bulk. Resulting in a lower cost to them and passing it on the to merchant. Also, has much more processing verticals and knowledge.

# 2 Equipment Offered Recap

A Bank

  • Banks have limited credit and debit card processing offerings.
  • Bank tellers and employees are not well trained in this other line of work. They are well trained in banking, not merchant services.

A Merchant Service Provider

  • A merchant service provider has a plethora of credit and debit card offerings.
  • Merchant service reps and employees are well trained as this is what they do for a living.

# 2 Equipment Offered Conclusion

Banks only have limited payment processing options as card processing as this is not their main line of work. A merchant service provider has many card processing options as this is their main line of work.

3 – Customer Support. Processing With A Bank VS a Merchant Service Provider.

Bank Merchant Services North American Bancard Staff

A Bank – Customer Support: Banks will often have their merchants call a 1-800 number if their merchants are having an issue. Again the merchant (business owner) will be calling a 3rd party service that the bank has chosen to do business with, merchant service provider. Some banks do have a customer service local number a merchant can call. As far as having a local representative come out to their business to check on them, banks score a zero on this. This drives their rates up because they are using a 3rd party for customer support.

A Merchant Service Provider – Customer Support: Here is another area where there is a big difference between the two. When your business is processing cards and an issue arises, they can call a 1-800 number their account is set directly up with. Merchants also have another option. They can call their local representative that helped them set up their credit and debit card processing account. We call this in the business, your local rep. A MSP such as, North American Bancard (NAB) for instance, has an outside agent program. They are relationship builders between the company they work for, NAB, and the merchant, the business owner. They are there on the local level to make sure all is going smooth. A merchant service provider scores 100 on this as apposed to a bank. Also, in-house provided customer support allows for lower rates by eliminating the 3rd party middle man.

# 3 Customer Support Recap

A Bank

  • In most cases, a business owners will call outside of the bank for support to a 3rd party.
  • No local representative to come by your business and help with processing equipment if ever needed.

A Merchant Service Provider

  • Business owners will call their merchant service provider directly.
  • Your business will have a local representative to come by your business and help with processing equipment if ever needed.

# 3 Customer Support Conclusion

By having your credit and debit card processing account set up directly with a merchant service provider, you will experience much better customer service. Plus you will also have a local representative that you can call or text message at any time.

Bank Merchant Services In A Nutshell

Greg G Kapitan of Utah EZ Pay

The banking vertical is banking. They are not in the merchant service business.
The merchant service vertical is, well, merchant services. AKA, credit card processing.

In short, you can see the top 3 reasons banks charge more to their customers for merchant services. Thank you for reading this blog post about the top three reasons banks charge the most for merchant services. Sincerely, Utah EZ Pay and Greg G. Kapitan.

Dual Pricing Utah

Greg & Michelle Leaving Miami FL

Dual Pricing Is Coming To Utah

This is a true story of how Dual Pricing fees for merchant services, (credit card processing) is coming to Utah.

My wife Michelle and I were planning a drive from our home in East Murray Utah to Miami Florida . This was a road trip allowing us to visit friends and family along the way. We had booked our first cruise with our friends from Heber City, Utah. They were flying and going to meet us at the ship in Miami Florida.

It was early evening on Tuesday February 21st when my wife Michelle said we needed to be hitting the road for our drive to Miami before the big snowstorm hits. Well, I, Greg, waited a bit too long so we ended up driving through the snow storm off and on clear until we were south of Moab Utah around the 4 corners region. I realized, I should have listened to my wife as we could of avoided driving through the stressful winter snowstorm.

Driving in the Utah snowstorm
Driving through snow covered roads at night from Salt Lake City Utah southbound to warmer weather.

Driving All Night To get Ahead Of The Storm

Knowing that the storm was large and stretching more and more across the country, we decided to continue driving all through the night. Then we arrived into the warmer region of the Texas Panhandle. This is where we finally decided to stop to have some brunch and rest the following day. We finally hit a very nice temperature of 72 degrees! It was also time to change into appropriate clothing as we headed towards Miami.

We continued our drive all the way to the Pensacola the Florida Panhandle to visit my parent’s final resting place. This would be only the second time we had been to these sacred ground to visit my parents and the countless others resting there. I wept tears of gratitude for being so fortunate to have my mother in my life for 94 blessed years and father for 77.

Driving To Miami & Boarding The Ship

It was then time to continue our long journey to Miami and meet up with our dear friends Matthew and Susan on the Norwegian Cruiseliner, the Encore, at the Norwegian Cruise Line terminal. The photograph is where Michelle and I had just boarded for our first ever cruise experience at sunset. The ship departed Miami in the evening and cruised on to the Great Stirrup Cay for our first stop then continuing onto St Johns Island and Tortola. Then to the Virgin Islands and finally the Dominican Republic. We had a great time cruising with our friends and taking a bunch of photos of our experience.

Greg & Michelle Kapitan
Michelle & Greg Kapitan Miami evening heading to our first stop at the Great Stirrup Cay in the Bahamas

Then, after 7 relaxing and fun-filled days, of escaping the Utah snow and cold, it was over and time for our drive back home to Utah.

Dual Pricing Signage Everywhere

On the drive back I really started noticing all of the posted signage of businesses choosing to pass credit card processing fees along to their customers. Posting these notices is a requirement in order to be compliant with the card brands. The image with the caption “Notice at the bottom of the menu, Prices listed and advertised reflect cash discount”. This was printed on the bottom of a menu at a waterfront restaurant in Northwest Florida. They are required to make the customer aware that the price listed is the price listed is cash discount pricing. The card price would be an additional 4% higher which, by the way, will cover all of the card processing fees.

Notice at the bottom of the menu, "Prices listed and advertised reflect cash discount"
Notice at the bottom of the menu, “Prices listed and advertised reflect cash discount”

More Dual Pricing Signage

Later, when we stopped at a convenience store for gas, washer fluid and facilities, I noticed yet another business who was notifying they would be charging a 3.5% fee for customers using a card to pay for their purchases. Notice the dual pricing revealed in the the image with the caption reading “Dual pricing notice of fees by a business in Florida which was posted on the countertop of this business.

Offsetting Fees – Dual Pricing Signage

This is what many businesses all across the USA are doing to offset their card processing fees. They are passing the fees onto the customer using cards to pay with. This should have considered and implemented from the get-go, however it is only now happening and quickly becoming the norm.

Cash discount store dual pricing a 3.5% fee
Dual pricing notice of fees by a business in Florida

The next day we stopped for a meal after driving all day to make an appointment with one of my clients. I noticed yet another customer pricing notice on the door of the restaurant stating “Non-cash pricing will see an increase at the Point Of sale”.

The cash discounting model and/or dual pricing as it is often called, is popping up in business all across the USA. Business owners are finally stepping up and passing the cost onto the consumer. But why didn’t businesses implement this many years ago? If one thinks about it, when the cost of their lease goes up or the price of their products, so does their prices. When the cost of labor goes up, business owners raise their prices. And so on Makes one wonder why was the credit card fees were missed.

Dual Pricing On Door Of Business No Rate Specified
Point Of Sale dual pricing notice. Cash discount savings.

I think the reason business owners were reluctant to do so was the lack of support from the Merchant Service (credit card processing) provider. The business owner would receive his monthly bill from the provider at the end of the month and just pay it, that was it. Now with the new technology available with the terminals, business owners have a viable option for dual pricing and a much smoother transition.

Smart Dual Pricing Terminals Automatically Adds The 4% Card Processing Fees

See the image, Smart Terminal Adding In The 4% Dual Pricing Processing Fees.

Smart terminal dual pricing 4% card processing fee
Image of a smart terminal in dual pricing mode we will set your business up with. Note the 4% fees added for paying with a card.

Utah EZ Pay will help get your new account set up the correct way with a smart terminal that will automatically calculate the 4% card fees for card paying purchases. If you look at the image, the Smart Terminal has added the 4% in fees to the purchase. You will see a transaction posted for $250 + the 4% = $260 which is what the customer will pay for processing a non-cash transaction.

We can set business owners up with the Edge 0% dual pricing program which will offset 90% plus of their card processing fees! Your cash paying customers will love getting a discount for the paying with cash option. With this, both the customer and merchant get to win!

i.e. If a business is charged $1,750 per month in fees, they will save $21,000 per year! This is $105,000 every 5 years! Visit to learn how this can work for the financial benefit of your business.

Question, so when was the last time you decided not to do business with a small business because they were charging extra for your paying with a card? I’d venture to say the answer is never, this is true fo me as well.

Utah State Tax Commission With Dual Pricing Fees

I recently came across this. The Utah State Tax Commission is also using a dual pricing model as can be seen in the image. They have been charging this fee for some time to Utahans to offset their fees. So, why not you?

Utah State Tax Commission Dual Pricing Charging A 3% Fee
Utah State Tax Commission adding fees for paying with a card. Another example for dual pricing to offset fees.

Get Your Utah (or the USA) Business To Save 90% Plus In Processing Fees

Call or text your merchant service advocate, Greg G Kapitan at 801-205-1955 with Utah EZ Pay today to get your business set up to save 90% plus off your card processing fees. Utah and business across the United States can start saving by using an Edge 0% Dual Pricing Card Processing model. Call or text me today!