Merchant Account PCI Compliance Fee Explained:
What is a PCI Compliance Fee? The PCI Compliance fee, also sometimes called a “PCI DSS Compliance Fee,” is a cost that is imposed by the Payment Card Industry Data Security Standards Counsel (PCI DSS) onto credit card processing service providers and sales organizations. PCI DSS is an organization created and controlled by the major U.S. card networks –American Express, Discover Financial Services, JCB International, MasterCard Worldwide, and Visa Inc. — and is responsible for overseeing and enacting data security policies regarding the card processing industry. Contrary to what merchant account providers often claim, the U.S. Government has no involvement in PCI Compliance.
PCI Compliance costs are initially incurred by merchant services providers as the sum total of the internal costs of maintaining compliance, security audit costs, and fines for breaches and non-compliance. Some of the collected fees go to PCI DSS Counsel in order to fund on-going security and fraud fighting activities. Merchant account providers often pass these costs onto merchants as annual or monthly “PCI Compliance Fees” based on their average cost per merchant account, plus a profit markup.
Critics argue that PCI Compliance fees are a scam of the payment card industry because the fees passed onto merchants are usually marked up with enormous profit margins. Additionally, they say that most processors provide no added value or services in exchange for the PCI Compliance fee and even charge it to merchants that have validated that they are compliant with PCI DSS requirements. Many call the PCI Compliance fee a form of taxation without representation.
PCI Compliance Fees may also be listed in a merchant account statement under different names, such as “Security Fee,” “Regulatory Fee,” and other similar variations.
PCI Compliance Video Explanation
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About Phillip Parker
Hi, I’m Phillip and I’m disgusted by the state of credit card processing in the U.S. and abroad. I believe that the industry has been overrun by people who engage in fraud and deception in order to steal money from hard working business owners. I’ve made it my mission to expose the companies and individuals who engage in predatory marketing, pricing, and contracts, or just provide terrible service. Along with uncovering the bad guys, I’ve also discovered the good guys who do stand out from the status quo. CPO is a website where you will find ratings and reviews of these companies along with advice on how to save money and which service providers consider. Together we can move the industry in a positive direction. If you would like to help support my work, please checkout “Fee Sweep” my eGuide to getting the lowest possible fees when accepting card payments. If you haven’t heard of “interchange” this advice will save you hundreds, even thousands, in processing fees.
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I just started online store started using mobile machine for vending as well as phone. Have hardly used the machine due to not service at events I have vended so far. My PCI DSS Compliance Fee is like $119 and more a month. We cannot afford this at this time. What do I do.
This is so true. I just noticed a $125 PCI FEE on my account. I use less than 1 transaction per month. What credit card gateway company can I use that will not rip me off like this?
It sounds like you would be best suited using a mobile processing app: Top Rated Mobile Processors
I spoke with someone from PCI and there is no PCI annual fee. He said maybe they are talking about isa of Mastercard but no such fee from them. None of the major players mandate any annual PCI Compliance Fee. That includes Visa, mastercard,American or Discover. These are fees to merchants from credit card processors to make more money. There are credit card processors who don’t charge these fees who will attest to that and these are the companies merchants should deal with. Of course any kind of fee , no matter what it is called, whether monthly or annually should be subject to scrutiny.
I only signed up as a matter of convenience to the occasional customer that will use a card. I have no storefront operation. I have done less than 1 transaction per month on average and so it would not pay for me to have a processing service who will charge an annual “PCI Compliance Fee” as well as monthly statement fee which can vary in amount and number of fees depending on the processor.
I recently signed with National Merchant Services in Brooklyn NY who has First Data do their processing for them. I signed a contract which showed $.00 in the annual fee box so I signed it. They just took $145 out of my account on Dec 3, 2012 . I did one transaction for $179.64. Of the $145 taken from my account without my knowledge or authorization was $115 for annual compliance, $ 15 for Non-Matching federal Id# which matched the other months and which i have had for decades. The management refuses to refund any of the money. You can see why more and more merchants will become wary of who they deal with and should require written guarantees before signing on. people like that should go to jail just as much as someone picking your pocket on a train or the street.