Merchant Agreement, Merchant Responsibilities and Pricings

Merchant Agreement, Merchant Responsibilities and Pricings

Have you ever seen all the pricings on your Merchant Account Agreements and asked what they mean? Online Business must always read and understand the terms and conditions for their payment gateway. Merchant Stronghold explains pricing schedule of fees:

Tiered pricing: Tiered discount pricing allows you to group interchange programs into different tiers “buckets” and then price those buckets separately based on the range of interchange costs grouped into each buckets.

ERR Pricing (Enhance Recover Reduce): Pass non-qualifying interchange costs to merchants. Using err, you have the option to assess a surcharge to the merchant’s downgraded sales volume. The surcharge is a client-defined percentage that is applied to the downgraded sales volume of participating merchants.

Pass-through interchange pricing: Using interchange passes through allows the expenses associated with interchange fees and dues and assessments to be billed directly to the merchant. If you are using interchange pass through plus, a sale transaction fee and/or a percentage rate would be assessed against the monthly volume and would be billed to the merchant along with the dues and assessments and interchange fees.

Pass-through Pin Debit: Allows you to pass through PIN debit network fees to the merchant. In addition to passing the network fees to the merchant you need to bill a per item charge, a percent on the volume, and a monthly flat rate debit access fee.


1. Ensure compliance with cardholder data security and storage requirements.
(Go to, select Small Business and Merchants, select Operations and Risk Management, select Cardholder Information Security Program)

2. Maintain fraud and chargeback below thresholds.

3. Review and understand the terms of the Merchant Agreement.

4. Comply with Visa Operating Regulations. (Go to, select Small Business and Merchants, select Operations and Risk Management, select Rules for Visa Merchants)

The responsibilities listed above do not supersede terms of the Merchant Agreement and are provided to ensure the merchant understands some important obligations of each party and that the Visa Member (Acquirer) is the ultimate authority should the merchant have any problems.

In order to comply with all Visa and MasterCard regulations governing Internet Credit
Card sales, Merchant Processing Bank requires that you will not accept credit card transactions through your website and/or e-mail and then manually enter them into your POS equipment or software. You must obtain a separate and secure e-commerce merchant account to accept credit card transactions for products and service purchased through a website or the internet.

Merchant Stronghold

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