Zero Cost Credit Card Processing

Some call it “free credit card processing”, others call it a “zero fee merchant account”… our customers just call it “awesome” – you will too!

high risk merchant account

What is Zero Cost Credit Card Processing?

“Zero-fee” refers to a processing method where businesses can process credit card payments without paying the processing fees. Instead of your business paying the credit card processing fee, the customer pays the processing fee. The charges vary by processor but it can’t be more than 4%. After the customer swipes their card, the terminal will notify them of the fee and give them a chance to accept or use a different payment form. When the customer covers the fee, you get 100% of the sale—it’s that easy.

As a retailer, “zero-fee” processing generates significant cost reductions associated with processing credit cards. It’s known as surcharging credit cards if you pass your processing fees to consumers, and it’s already an option that you can select regardless of your credit card processor. In all but 9 states in the United States, surcharging is allowed as long as certain criteria are met.

From gas stations and cell phone carriers to healthcare and nonprofits, many industries have found success with zero-fee processing and continue to give their customers the option to decide which card payment is most convenient.

Benefits of Zero Cost Credit Card Processing

There are numerous benefits of zero-cost credit card processing for your business. For one thing, it can help you avoid hefty monthly fees for using your merchant account services. In addition, if you’re strapped for cash, zero credit card processing fees allows you to invest more of your profits back into your business. Plus, you have the freedom to adjust the pricing of your product or service to fit your needs.

Additionally, it may provide more security than other options by ensuring that all sensitive information remains with the provider rather than being stored at another location such as in-house servers or mobile devices. Many business owners use zero-cost credit card processing to prevent fraud and ensure their company won’t be responsible for invalid charges.

Many companies also don’t lock you in a long-term contract, equipment fees, or have any upfront costs, so it’s easy to get started. 

Considerations before you Deploy Zero Cost Credit Card Processing

Surcharging programs can shift the cost of processing transactions onto your customers, but you’ll still be paying fees, including a host of recurring and incidental merchant account fees. In addition, you might also be charged an additional monthly fee for adding surcharges on to your card.

Evaluate carefully to ensure that this doesn’t cost more than it would have without a surcharge program. For example, implementing a zero-cost credit card processing program works best for businesses with a high credit card monthly volume. On the other hand, charging may not make sense if your business rarely takes credit cards.

To surcharge credit card users, you must provide adequate notice that they’ll be charged extra. The biggest downside is that this’ll lead to lost website or store sales once your customers realize their purchase will incur additional fees. Ensure that your business has a plan on how to attract and keep customers when they’ll be expected to pay 3-4% more at your business. 

Examine what your competitors are doing before surcharging. If they aren’t, you’ll put yourself at a competitive disadvantage, which ultimately results in less profit than if you opted to shoulder the processing fees yourself. The Internet has made it easier than ever for customers to obtain goods and services, so factor this in your decision to implement a zero-cost credit card processing program.

It’s important to note that surcharges can only be applied to credit card transactions, making customers consider using their debit card or paying with cash instead, which might result in overall lower processing costs. Still, you won’t eliminate fees because many consumers take advantage of credit card reward programs while others never carry any form of currency. For these types of consumers, these surcharges will likely discourage them from shopping at your store altogether. 

Before choosing a no-fee processing program, consider the advantages and disadvantages. Of course, you’ll want to weigh savings in credit card expenses against lost sales or incensed clients, but ultimately, the only way to know is to give it a shot.

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Zero Cost Credit Card Processing

credit card processing

Credit Cards

Sell $100 on a credit card, receive $100 in your account, and you pay:

$0

Your Customer’s Fee

3.5%

debit card

Debit Cards

Sell $100 on a debit card, receive $98.75 in your account, and you pay:

1% + $0.25*

Your Customer’s Fee

0%

Equipment Pricing

In-Office Virtual Terminal

$0/month

Free In-Person Terminal with EMV Quick Chip

$35/month

Online Lightbox Terminal

$0/month

Questions To Ask Zero-Fee Credit Card Processors


The best thing you can do before signing up with any type of credit card payment service is to ask questions! If the company can’t provide satisfactory answers, don’t be afraid to move on until you find one that does meet your needs. Some basic questions to ask include:

Are there early cancellation fees?  

The last thing you want to do is sign up for long-term service and then realize that you can’t afford it. So if there are any fees associated with canceling early, make sure that they’re spelled out clearly in your contract, so you don’t get charged unexpectedly.  

What is your transaction fee?

Some companies will charge a flat fee, while others will charge per transaction. Make sure that you know which is the case for the company you choose. Also, if there is a per-transaction fee, ask how many transactions per month they’ll allow before charging more. Many companies do not exceed more than three or four transactions per month.

Do you charge extra for equipment?

Equipment is an expense that you can easily cut if you’re thinking about canceling your service. Also, make sure that any equipment the company provides meets the criteria of significant credit card companies; otherwise, you’ll be unable to accept primary payment methods.

Do you offer free or low-cost processing?

It’s best to sign up with a company that offers both free and low-cost processing. This way, you have the option of choosing which works better for your business, depending on your specific needs at any given time. Also, some companies offer no monthly fee with low-cost processing, which is a huge bonus!

Do you offer a trial period?

Before agreeing to any long-term processing plan, ask the company if they offer a free trial period to test out their service. This allows you to make a more informed decision about whether or not the company is right for your business without needing to sign any legal documents.

What other fees do you charge?

Make sure that there are no hidden fees upon signing up with a credit card processing service. For example, it’s common for companies to charge fees for canceling your service early, equipment not returned in good condition, etc. Ask the company if there are any other fees associated with signing up or using their services before you finalize anything.

What payment plans do you offer?

Some companies allow their customers to pay monthly, which will enable you to budget for the expenses involved with credit card processing. If this is an option, ask if anything else might cause unexpected charges on your bill.

Do I get everything I need to process credit cards right away, or will I have to wait to set up my account?

Some companies require you to wait, while others will provide you with everything right away. The last thing you want is for customers to be waiting on their credit card swipes because you haven’t been supplied with them yet!

What forms of payment do you accept?

Lastly, find out what forms of payment are accepted. For example, if the company only accepts cash, it might not be the right fit for your business, so make sure the company you’re working with accepts your customers’ preferred payment methods.

How Zero-Fee Credit Card Processing Works

No upfront cost and no long-term contracts.

Pass on the credit card processing fees with a zero-fee credit card processing merchant account. When a customer uses a credit card, they also agree to pay the fee. Once the customer swipes their card, the terminal will notify them of the fee and give them a chance to accept or use a different form of payment. When the customer covers the fee, you get 100% of the sale—it’s that easy.

No Fees
Pass on credit card processing fees and keep 100% of sales.

Fully Compliant
Abides by all rules and regulations from the new Dodd-Frank Act.

No Contract
Zero annual contract to worry about, you can stop at any time.

Bankcard helps businesses cut costs while treating customers who pay with cash or debit cards more fairly. Zero-fee processing passes the credit card processing fee onto the customer if they choose a credit card for convenience or use a debit card with no additional cost. 

As a business, you’re still responsible for debit card transaction fees, even those related directly to the processing. Though, if your business processes numerous credit card transactions each month, it may be worth considering.

Online, In-person, or Virtual Terminal? We have you covered.  

Bankcard offers seamless payment integrations to your online store, custom terminals with zero-fee options pre-installed, or a dedicated web portal with no software to install. 

Does your business qualify for Zero-Fee Credit Card Processing? 

Zero-fee processing is available in 46 states, plus the District of Columbia. Additional terms or restrictions apply in Maine, New York, Colorado, Connecticut, Massachusetts, and Kansas. 

Zero-Cost Credit Card Processing Laws by State:

Colorado

  • For Business: No, Colorado businesses cannot use zero-fee payment processing. As legislation changes, we will continue to track updates to state policy.
  • For Government: Yes
  • For Education: Yes, but only Colorado educational institutions that are state schools are eligible to use zero-fee payment processing. 

Connecticut

  • For Business: No, Connecticut businesses cannot use zero-fee payment processing. As legislation changes, and we will continue to track updates to state policy.
  • For Government: Yes
  • For Education: Yes, Connecticut education institutions cannot currently use zero-fee payment processing.

Kansas

  • For Business: No, Kansas businesses cannot use zero-fee payment processing. As legislation changes, we will continue to track updates to state policy.
  • For Government: Yes
  • For Education: Yes, but only Kansas educational institutions that are state schools are eligible to use zero-fee payment processing. 

Massachusetts

  • For Business: No, Massachusetts businesses cannot use zero-fee payment processing. As legislation changes, we will continue to track updates to state policy.
  • For Government: Yes
  • For Education: Yes, but only Massachusetts educational institutions that are state schools are eligible to use zero-fee payment processing.

Maine

  • For Business: Yes, Maine businesses can use zero-fee payment processing, as long as they disclose the merchants must disclose the “credit card price” alongside the “cash price” with equal prominence. 
  • For Government: Yes 
  • For Education: Yes, state schools in Maine can use zero-fee payment processing. Maine private schools must disclose the “credit card price” alongside the “cash price” with equal prominence.

New York

  • For Business: Yes, New York businesses can use zero-fee payment processing, as long as they disclose the Credit Card Price in dollars and cents whenever they post or quote their prices.
  • For Government: Yes
  • For Education: Yes, New York education institutions can use zero-fee payment processing, so long as they disclose the “credit card price” alongside the “cash price” with equal prominence.
Bankcard was referred to me by my developer. From the jump, they were impressive. They were super responsive, they asked great questions and their solution was really robust. Also, working with Katherine and Hanna is a dream!
High risk merchant account
Emily Wallace
CEO

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Ideal Industries for Zero-Cost Credit Card Processing: 

Wholesale Distribution
Retail
Property Management
Outdoor Services
Nonprofit Organizations
Marinas
Logistics
Law Offices

Insurers
Eye Clinics
Equipment Sales & Rentals
Cosmetic Services
Contractors
Auto Repair
Auto Dealerships

Zero-Cost Credit Card Processing Frequently Asked Questions: 

 

Q: I see that some companies offer a “cash discount” program. Is this compliant?

A: In general, no, because they list the cash price and add a fee at the point of sale.

A cash discount works by applying a small customer service fee to all transactions. This fee is removed if the customer pays with cash or an in-store gift card.

There are clear regulations for zero fee processing that must be followed. Cash discount programs come with a lot of confusion for both consumers and employees. The truth is, not all cash discount programs are built the same, and most don’t adhere to federal compliance laws because they list the cash price on the shelf and then mark up the fees at the point of sale.

Q: Can I pass on the cost of card acceptance with a “convenience fee”?

A: You cannot pass on the cost of card acceptance with a convenience fee for several reasons.

  1. A convenience fee must be a flat-dollar amount, regardless of the value of the payment due. In other words, the convenience fee mustn’t be a percentage and mustn’t increase in any way as the transaction size increases.
  2. A convenience fee may only be applied in a card-absent channel of acceptance (such as online or by phone). Additionally, the merchant must also accept credit cards in person and apply no fee to card-present payments; therefore, a merchant that accepts only card-absent payments may never use a convenience fee.
  3. Finally, the merchant’s convenience fee may only be applied. (A convenience fee applied by any third party is non-compliant.)

For these reasons, it’s highly doubtful that a compliant convenience fee will cover the cost of card acceptance.

Q: Can I pass on the credit card fee if a customer using a debit card presses the “credit button” on a terminal?

A: No, you can’t.

Regardless of how the customer’s debit card is processed at the point of sale, you mustn’t apply a fee to debit cards. Our services automatically detect when a debit card is entered and apply no fee to keep you compliant with existing rules and regulations.

Q: Do different rules apply to government and education institutions?

A: Yes, they are eligible for the “service fee” program.

Government and education institutions are eligible for the “service fee” program, which permits the fee to be applied to both credit and debit cards. In addition, this program requires that the fee be processed as a second, separate transaction.

How to stay compliant

Many merchants are not aware of the guidelines governing surcharging, which can lead them into legal jeopardy. 

Credit card processing companies have binding contracts with every merchant they serve, so you must know your provider’s terms. 

Suppose you don’t abide by the terms. In that case, your provider will prevent you from taking further payments from customers via credit cards, which could ultimately result in your business losing access to a critical revenue stream. 

Here are a few things Bankcard does to ensure you’re fully compliant:

The Rule

Our Solution

The merchant must be registered with the card brands.

Our team completes each registration on your behalf and we provide you with all necessary signage, keeping customers informed—and keeping you compliant.

The amount of the credit card fee must not exceed 4%, and the merchant must not profit from the credit card fee.

Our solution passes on a 3.5% credit card fee. You receive 100% of your sale—no more or less.

The amount of the credit card fee must not exceed 4%, and the merchant must not profit from the credit card fee.
The credit card fee and the price of the product or service must be processed together as one transaction.

Our solution processes the credit card fee and the purchase amount as one transaction.

The receipt must show the amount of the credit card fee as a separate line item.

Our solution produces a receipt that itemizes the credit card fee.

The merchant must not apply a fee to debit cards.

Our solution automatically detects when a debit card is entered and applies no fee.

 

Integrations

Bankcard Connect plays nice with others

Bankcard Connect integrates seamlessly with ISV software to simplify payment processing for merchants: any payment type, on any device, anywhere. 

Bankcard integrates with over 99% of the tools you are already using, including popular accounting software and e-commerce apps, regardless of your industry. Our payment services were designed to be adaptable to provide seamless integrations for our customers.

merchant account integrations c

BigCommerce
Formsite
Infusionsoft
Keap
Magento
Microsoft Dynamics
Network Solutions
SalesForce
Shopify
Volusion
Web.com
Weebly
WIX
WooCommerce
WordPress
Yola

Cart66
Checkfront
EASYCART
eShop
Event Espresso
events manager
GetShopped.org
GRAVITY
Jigoshop
Paid Memberships Pro
Shopp
SHOPPERPRESS
templatic
TheCartPress
WishList MEMBER
WooCommerce
WORDPRESS eSTORE
WP GATEWAYS
WpInvoice
wpmudev

Drupal Commerce
Ubercart

HikaShop
Miwisoft
VirtueMart

911 Software, Inc.
ACR Systems
Activant
Aldelo Systems, Inc.
Applied Micro Technology
Advanced Retail Management Solutions (ARMs)
Auto star
Cantaloupe Systems
Data Business Systems
Datacap Systems, Inc.
DataTech Corp
DataVantage
Edgil Associates
Elavon*
Epicor (CRS, NSB)
Freedom Pay
Gateway Ticketing Systems
Idalica Corp
IJN Systems
IT Retail
KWI
Main Street Softworks
MBS Textbook Exchange
Medasyst, Inc.
Microsoft
/n Software, Inc.
PC America
POSiFlex
RATEX Business Solutions
Retail Data Systems
RTL Payment Systems
ScanSource, Inc.
Sicom Systems, Inc.
Slim CD
Tempus Technologies
Tender Retail Systems
The Software Mills
Tomax Corporation
Total Computing Solutions
TouchNet Information Systems
XProtean, Inc. (C-Payment Software)
XPient Solutions
Vista Entertainment Systems

911 Software, Inc.
Data Business Systems
Dinerware
Datacap Systems, Inc.
Main Street Softworks
Menusoft Systems Corp.
Micros Systems
Midnite Express, Inc.
/n Software Inc.
NCR
onePOS.com
Ordyx
Radiant Systems
Revel Systems
Sicom Systems, Inc.
Squirrel Systems
Tempus Technologies
XPient Solutions
XProtean, Inc. (C-Payment Software)
Elavon (previously Southern DataComm and Global Card Services)

Dresser Wayne
Excentus
Fuel Links
Fiscal Systems, Inc.
Gilbarco
LOC Software
Main Street Softworks
Petro RX
PetroVend
Radiant Systems
Retalix
VeriFone Ruby System

Datacap Systems
JPMA
LOC Software
Logivision
MTX/EPS
RORC
StoreNext
Torex

911 Software, Inc.
Hotel Software Systems
Slim CD
Elavon
Tempus Technologies

Government organizations face a growing need for secure payment processing services while managing highly specific needs for content management and security. 

We can work with popular technology products government agencies prefer, like Ciber and Cubic, to create an integrated solution that meets all your needs for processing payments, managing information, and more.

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Instant everything.
Next-generation tech.
Easy integrations.

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Give us a call!
800-520-4488

Super-friendly, US-based support from our headquarters in Michigan.

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