Surcharge Management
Reduce Processing Costs. Calculate and display the surcharge fees in compliance with surcharge rules & regulations.
Configurable surcharge rules and management per country, business unit, and merchant preferences.
Automatically calculate and display applicable surcharges as per configured criteria.
Surcharges are calculated as a percentage of the transaction amount, typically based on the cost incurred by merchants for accepting credit card payments. For example, if a customer purchases an item for $100 and the surcharge is 3.5% the surcharge would be $3.5. This amount is added to the total transaction cost.
The formula to calculate a surcharge is: (Transaction Amount) x (Surcharge Percentage). The surcharge percentage is usually capped by law or card network rules, ensuring it doesn’t exceed the merchant’s actual processing fees. Merchants must follow surcharge management practices by clearly disclosing surcharges to customers before completing the transaction.
Surcharge fees are determined based on the cost merchants incur from card processing fees, particularly for credit card transactions. Typically, these fees range from 1.5% to 4% of the transaction amount. Merchants can pass on these costs by adding a surcharge to credit card transactions.
However, the amount merchants can charge is regulated by card networks (like Visa or Mastercard) and local laws. Merchants need to follow specific guidelines, including notifying customers about the surcharge and making sure it does not exceed the cost of card acceptance.
A 3% surcharge means that an additional charge equivalent to 3% of the total transaction amount is added to the payment when a customer uses a credit card. For example, if a customer buys a product worth $100, a 3% surcharge would add $3, bringing the total payment to $103.
Merchants apply this surcharge to cover the cost of processing credit card payments. While legal in many places, surcharges must be disclosed to the customer upfront and are subject to regulations that may vary depending on the region and card network.
A surcharge is an additional fee applied to credit card transactions to help merchants cover the cost of processing fees, while a convenience fee is charged when customers use an alternative payment method, such as paying online or over the phone, instead of the standard option like in-store payments.
Surcharges are added directly to the transaction total only for credit card payments and are often regulated by laws or card networks. Convenience fees, however, are charged for offering customers the “convenience” of using a different payment method and can vary depending on the situation or industry.
Surcharge Reporting Dashboards allow businesses to see how surcharges are applied across transactions, ensuring transparency and compliance. It helps in monitoring the effectiveness of surcharge policies and aids in making informed decisions to optimize surcharge strategies and improve overall revenue.
Surcharge Reporting provides businesses with detailed insights into the performance and impact of applied surcharges. By analyzing this data, businesses can identify trends, assess the effectiveness of their surcharge policies, and make data-driven adjustments to enhance financial management and increase profitability.
