We have a small a specialty publishing company offering a subscription
publication (we have several hundred subscribers). We also sell
individual issues and charge for various other services. The business
is well established, but I'd like to change our operations so that
people pay in advance and the staff spends less time on collections.

I would like information on accepting credit cards. How does this
work? What will it cost us? (i.e. how much would we need to raise our
prices to cover the credit card processing fees?) Can we offer our
subscribers the choice of giving their card number to us by phone, fax
or web? What do we need to do/get to be able to accept credit cards?
Are there different policies for the various cards (Visa, MasterCard,
Amex)?

The subscription fee is ~$400, the single issue fee is ~$60. We do
several hundred thousand is sales per year.

I am looking for a few options with an analysis of the pros and cons
for each. We are based in NYC.

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Clarification of Question by jeffrey333-ga on 24 Oct 2003 10:02 PDT

We talked to Innovative Merchant Solutions (a company that partners
with Commerce Bank), but they won’t work with us because we charge for
annual subscriptions to our publication. Can you give me a list of
other merchant companies and contact info? We need a company that can
work with our bank and will accept charges for subscriptions.

Hi jeffrey333,

I answered a similar question not that long ago and you may find some
of the information helpful:

http://answers.google.com/answers/threadview?id=231084

-"how much would we need to raise our prices to cover the credit card
processing fees?"

Merchants are not allowed to raise the cost of products to cover the
processing fee. In other words, customers cannot be penalized for
using their credit cards. The fees are just considered a cost of doing
business and are a legitimate business expense.

-Can we offer our subscribers the choice of giving their card number
to us by phone, fax or web?

The answer to this question is Yes, no problem, as long as you provide
a secure order form on your website for the online orders.

-What do we need to do/get to be able to accept credit cards?

Essentially, a "Merchant Account", either with a local bank or a
credit card processor as listed in the above link. Go into your own
bank where you do business and ask them what their policy is. Start up
fee, discount rate, transaction fee, etc. You might find it to be just
as reasonable as anywhere else.

Regards,
hummer

Hello jeffrey333:

I answered a similar question recently. It may help to review.
Following is the link:

http://www.answers.google.com/answers/threadview?id=255393

here is a page with contact numbers for accepting visa.
http://www.usa.visa.com/business/merchants/get_account_list.html
another link, to a page with some information regarding standard visa
fees (nonspecific)
http://www.usa.visa.com/business/merchants/get_account_list.html

"Merchants are not allowed to raise the cost of products to cover the
processing fee. In other words, customers cannot be penalized for
using their credit cards. The fees are just considered a cost of doing
business and are a legitimate business expense."

This is true, but you *can* offer a discount if people play with
cheque or money order. http://www.vibecomputers.com/ is an example of
one company that does this.

Q: What is the non-cash charge?
A: All prices listed on our website reflect a 3% cash discount, which
can be kept for payment by direct deposit or money order. Other
payment methods are considered "non-cash", and do not qualify for the
discounted price; the addition non-cash charge reflects this increase.
SOURCE: http://www.vibecomputers.com/index.cfm?loc=fp-faq&if=y