[et_pb_section][et_pb_row][et_pb_column type=”4_4″][et_pb_text]If your small business accepts Visa card payments, you may be facing higher interchange fees soon. A recent Bloomberg report cited a document sent by Visa to banks, which detailed how Visa’s new merchant rate changes will take effect and who they will impact.
Visa and Mastercard facilitate more than $6.5 trillion in card payments each year, and interchange fees mean they get a slice of that pie.
With the new changes, Visa will earn $1.99 on a $100 transaction for a traditional Visa card, and $2.60 per $100 spent with a premium card. These fees go up from $1.90 and $2.50, respectively.
While these changes are literally a matter of a few cents, they certainly add up, especially if your business takes in a majority of your revenue via credit card payments.
Will Your Business Be Impacted by Visa’s New Merchant Rate Changes?
Any business that accepts card payments pays interchange fees to the card issuer every time a consumer pays with a credit card. Visa will be changing these fees in different ways for different types of companies.
Transactions performed on e-commerce sites will see higher rates, while those operating in certain categories, such as education and real estate, will see fees go down. Changes will roll out in April and October 2020, so it’s best to check with your credit card processor or with Visa directly to know how your business will be impacted.
How to Prepare and Adjust
As with any new expense, now is the time to revisit your company’s budget and make the moves you need to. Even though these charges individually only come out to be several cents extra, those can add up quickly. Don’t let them bury you.
For guidance on how to navigate these changes if they look like they may have a significant impact, refer to your business plan. Keeping tabs on your original (and hopefully updated) roadmap and priorities can provide clarity when making tough decisions such as these.
If you’re looking for some backup, there are various types of business financing that can help you bridge gaps in cash flow or buy you time while you adjust to extra charges.
Business Financing Solutions
A business line of credit is a great arrow to keep in your quiver and can be there for when you need cash. Established businesses with solid business credit can potentially qualify for lower rates and high limits.
Ironically, a business credit card could also help you handle the increase in interchange fees. With stellar welcome offers and a slew of reward offerings, you could find one that pays you to use it.
Be prepared. Take time to revisit your budget and business plan, and don’t let changes like Visa’s new merchant rate changes take you down or sideline you.
Small business financing can be a boon in times like these; take a look at your options to find the right fit for you.
This article was originally written on February 12, 2020 and updated on September 8, 2022.