Why do some businesses charge extra 2-5% on credit card payments?

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Accepting credit cards comes with costs that businesses need to cover. They can either absorb these costs, offer discounts for cash payments, or directly pass them on to customers through a surcharge. Here are the key reasons:

1. Credit Card Processing Fees: Businesses pay fees to acquirers, schemes, and issuers for each transaction, typically ranging from 1 to 3% of the transaction amount. Some businesses pass these fees directly to customers.
2. Rewards Programs: Credit card companies offer rewards to customers, which cost businesses money. To recoup these costs, businesses may add a surcharge.
3. Small-Ticket Transactions: For smaller transactions, processing fees can be relatively high compared to the transaction amount, leading businesses to add a surcharge to offset these costs.

Join us in Module 2 of the PaymentGenes Academy to thoroughly understand the intricate world of digital payment regulations.

This module is designed to equip you with the essential knowledge and skills necessary to navigate this complex field. You will explore key aspects of digital payment methods, security protocols, and regulatory compliance, ensuring you are well-prepared to handle the challenges of this ever-evolving industry.

Understanding Digital Payment Methods.

• Credit and Debit Cards: Differences and benefits of credit, debit, and prepaid cards & Global usage statistics and regional variations.
• Virtual vs. Physical Cards: Characteristics and benefits of virtual cards & Security features and privacy advantages.
• Open Loop vs. Closed Loop: Definitions and examples of each & Use cases and acceptance scenarios.

Security and Fraud Prevention.

• EMVCo Standards: Overview of EMVCo and its role in payment security & Importance of EMV chip cards.
• 3D Secure (3DS): How 3DS adds an extra layer of security for online transactions & Benefits and implementation examples.
• Strong Customer Authentication (SCA): PSD2 regulations and SCA requirements & Practical examples of SCA in action.

Data Handling and Tokenization.

• Data Levels: Explanation of transaction data levels 0-3 & Benefits of higher data levels for B2B transactions.
• Tokenization: How tokenization enhances security & Use cases in mobile and e-commerce transactions.
• Regulatory Compliance: Importance of complying with PCI DSS & Steps to ensure secure handling of payment data.

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Explore this module and more at The PaymentGenes Academy Foundation course to elevate your understanding of the ever-evolving world of digital payments.

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