PPAI Research Benchmarking Supplier Credit Card Fees INSIGHTS Cr ed i t Ca rd Fees by Robert Fitzpatrick and Kristina Valdez Merchant fees when processing credit card payments are a cost of doing business. We asked suppliers their standard fees to present a picture of what industry companies pay. In a new PPAI benchmarking survey, responding promotional products suppliers charge distributors an average of 2% for credit card purchases. In most instances, the suppliers merely pass along the same rates they are charged by credit card companies. The benchmarking information could be useful for suppliers to assess how their rates compare to competitors, or to distributors curious about how the fees they’ve been paying stack up. • Every time a business accepts a credit card payment, credit card issuers charge a merchant fee. • Many businesses build these costs into all of their prices, though some apply a specific fee that would not be charged for ACH payments. • Among supplier respondents, the highest percentage charged to distributors was 5.08%. Certain responding companies reported that they simply take the hit from the credit card companies and do not pass the price along to distributors. “We consider it good business and a way to get quicker payment,” one said. Credit card fees are legal in most states. Businesses can charge convenience fees or a surcharge. Customers are charged a convenience fee when they use a form of payment that isn’t customary for the business. This is legal in all 50 states, but it must be clearly communicated at the point of sale and with another preferred form of 14 | DECEMBER 2022 | INNOVATE
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