Qualified Rate Explained:
What is a Qualified Rate? Also referred to in the credit card processing industry as a “Qualified Discount Rate” or “Qualified Transaction Fee,” this fee is found in tiered/bucket merchant account pricing schemes. The Qualified rate is usually part of a three-tier fee model with the other two tiers most often called “Mid-Qualified” and “Non-Qualified.” There are many variations of these tiers and associated names because there is no industry standard on how rates and fees can be structured or what they must be called.
The Qualified rate is often the only rate that is advertised or quoted to merchants because it is the lowest and most attractive fee. The quotes often look something like “1.59% + $0.10 per transaction,” but fail to mention that 50%, or less, of a merchants transactions will experience this low rate. The other 50+% will be charge at the higher Mid- and Non-Qualified tiers.
Merchant account providers primarily determine which rate tier a merchant will incur based on a customer’s card type. Generally, the only cards that fall into the Qualified tier are credit cards that do not have an attached reward program such as miles or points, and signature debit transactions where the debit card does not have an attached rewards program.
Learn how everything thing you need to know about rates and how to get the lowest fees from any provider in “Fee Sweep: How to Get the Merchant Services You Need Without Getting Scammed.”
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About Phillip Parker
Thank you for reading my review. I hope that it has helped you with your research.
Why I'm Qualified to Write About Credit Card Processing and Merchant Account Services
I'm a former credit card processing sales director who left the industry because I didn't like how it takes advantage of small business owners. It feeds like a leech on businesses and thrives by imposing fees that are nearly impossible to comprehend. Seeing a need for change, I left and built this website help business owners better understand the industry, research merchant services providers, and get refunds of excessive merchant account fees. My experience of working "behind the curtain" in the industry, and using that knowledge for good, has resulted in millions of dollars returned to hard-working small business owners as well as enterprise-level companies.
From the time that I starting working in the merchant services industry to when I left to create this website, I've been on the pulse of payments for nearly 15 years. It didn't seem fair to keep this "insider" knowledge to myself. To lift the fog, I've reviewed hundreds of companies, read thousands of user reviews, and learned the pricing tricks of every provider. If you have questions about credit card processing, you can find the answers on this website.
Phillip Parker
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