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How to Recover Payment Processing Fees
How to Recover Payment Processing Fees
Updated over a week ago

SE Payments charges merchant fees for every credit card transaction, and some organizations decide to recover those fees.

NOTE: It's recommended to raise prices to offset processing fees and charge the same amount regardless of the payment method used, known as a "single pricing scheme." Studies have shown that people prefer it (kind of like “$12 + $3 shipping” seems worse than “$15 with free shipping”), and it's not allowed in some states, so this eliminates both problems.

For those organizations that would instead pass along those processing fees to their customers separately, known as “surcharging,” there are some ways to accomplish this. Here are some things to be aware of if you choose this route.

Be aware that you cannot wholly recover your processing fees. This is because the total amount charged to the customer (invoice items + surcharge fees) is what SE Payments (SEP) assesses the processing fees of.

For example, suppose a customer makes a $100 payment, and your SEP rates are 2.9% + 1% technology fee + $0.30 per transaction.

$100.00 Class Fee

+ 2.90 CC percentage fee

+ 1.00 Technology fee

+ 0.30 CC transaction fee

$104.20 Total charged to the customer

SE Payments then processes this as follows.

$104.20 Amount processed through SEP

- 3.02 CC percentage fee

- 1.04 Technology fee

- 0.30 CC transaction fee

$ 99.84 Amount SEP deposits to your org

Note that most credit card companies prohibit surcharging more than the fees they charge you. Again, the best practice is to “bake in” the processing fees to your rates if you'd like to recover your processing fees. Using the above example, setting your price to $104.37 will net you $100.00.

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