The registration process is proof that some of the hardest work happens before the season’s first whistle.
Youth and amateur athletic organizations of all sizes struggle with many of the same challenges. From communicating deadlines to collecting and organizing information from hundreds or thousands of athletes … if you’ve been through it, you know it can all be a real strain on your sanity at times.
Then there’s payment.
Setting up a merchant account and working with payment processors provides a whole new set of unique challenges just waiting to be discovered, not the least of which is figuring out what you’re actually paying your processors for their services.
Hidden in plain sight
Most processors will sell you on their best processing rate. But what they don’t necessarily advertise are the additional costs on top of that rate – the true cost of doing business with them.
And while most times these “hidden” costs are spelled out within the terms, they’re often buried in the fine print.
In other words, these fees are typically “hidden in plain sight.”
To help you better protect your organization’s money, we’ve identified six of the most popular fees companies use to increase your overall processing and registration costs. How many are lurking in the fine print of your statement?
'Downgrades'
Depending on your pricing plan, you may realize different fees depending on whether the transaction is ‘Qualified’, ‘Mid-Qualified’, or ‘Non-Qualified’. Qualified transactions must meet all of the processor’s criteria for processing, such as a swipe in-person with a batch settlement the same day. Failure to meet one or more standards will result in a downgrade. As an e-commerce merchant, it’s possible that the majority of your transactions are being downgraded resulting in significant additional fees.
How this hurts
You think you’re paying one rate, but many times you’re actually paying the “downgraded” rate. The best rate usually applies to “qualified” transactions only.
Annual/Monthly fees
Many processors will charge annual or monthly fees. Included in this could be PCI compliance/non-compliance fees, statement fees, gateway fees or any other set fee you see on your statements each month or year. These set fees are charged regardless of whether or not you process in a given period.
How this hurts
The processing company may have a rate and even a transaction fee that you think is good, but when you distribute a monthly and/or annual fee across all of your transactions, it adds up. This is especially painful for smaller organizations who aren’t processing enough to obtain a rate that allows them to get around batch fees during slower processing months.
Minimum Fees
Many processors will charge significant fees if a monthly or annual minimum is not met - i.e. $5,000 each month or $75,000 annually. (Check the contract.)
How this hurts
Much like annual/monthly fees, if you’re a growing organization, you’re going to get docked because you’re just not processing enough to avoid this fee.
Statement/Reporting Fees
Some processors will charge a statement fee or similar reporting fee to be able to access or receive reports online.
How this hurts
You’re going to get charged to access your statements, be it per statement or as a monthly access fee. While you could live with statements mailed out on a monthly basis, sports organizations generally need to have access to this information almost daily during the busy registration period.
Termination Fees
Some processors will charge their customers high fees to terminate a processing contract. (Check the contract.)
How this hurts
This is a great tactic for processors as it decreases the likelihood of switching processors even after finding a superior and/or more cost-effective solution until the contract ends. Processors have put this in place to combat organizations (such as sports organizations) who try to avoid monthly/annual fees by terminating their agreements.
Rewards/points/miles
Many merchant processors quote your rate based on low/no rewards (check-card use), so if transactions come through with Skymiles or Rewards, the processing organization pays those. Many merchant processors will add that onto the transaction rate for each.
How this hurts
Obviously, it’s not ideal for you to have to pay for a bank or other program’s reward benefits. In the increasingly competitive world of credit cards, these types of rewards are becoming more lucrative and, in many cases, are being paid for by unsuspecting organizations like yours.
SPORTSENGINE REGISTRATION
SportsEngine Registration is a complete online registration and payment processing solution. We create thousands of registrations each month for sports organizations, and are PCI Level 1 compliant – the highest payment data security level of any organization in the youth and amateur sports marketplace. We provide you with an effective rate upfront, and only charge for registration technology when you use it.
No monthly fees, no set up fees, no hidden fees.