If you’re a bit confused and bewildered about unexpected fees and charges that may be turning up in your credit card processing statements, you’re not alone. Recent research by Law Technology Today, an online publication of the American Bar Association, states, “many lawyers who run boutique law firms of fewer than ten employees are so busy handling day-to-day issues that they don’t adequately address their credit card transactions and related costs. This happens not only to small law but also to CFO’s who manage larger legal practices.”¹ In other words, just because you are an astute attorney, you can still fall prey to the same challenges and issues that face almost every business that accepts credit cards. Namely, hidden and increasing fees that were not made clear to you when you signed on the dotted line.

Transparency in processing fees is ethical and makes understanding your statement easier while increasing your law practice’s profitability by avoiding hidden and escalating fees that can add up over time. Accepting ACH(e-checks), credit and debit cards helps you simplify your payment process, get paid faster, cut costs by freeing-up employees, and give clients the payment options many prefer. There are many positives to accepting credit card payments. Still, you must complete your due diligence to select the right processing company for your firm and monitor your statements to ensure your rates don’t increase or include hidden fees. While increased rates and hidden fees are annoying, it is a practice used by many merchant processors so that the processing company gets to keep as much of your money as possible. It pays to stay on top of your statements, but it does take time and energy to do so. What if there were merchant processors whose rates never increase nor charge hidden fees?

Here are some insider tips you might want to keep in mind when checking out a credit card processing company. The first thing most people ask is, “What is your rate?” A better question would be, “What is your rate, and are there any hidden costs that can increase my monthly bills?” Some credit card companies have hidden costs that appear seemingly out-of-the-blue. Yet, according to the same Law Technology Today research, “…most lawyers and company administrators are unaware of these additional fees and how they adversely affect the bottom line.”

One reason these fees pop up is that the rate structures are based on the type of card used and how a transaction is processed. For example, if a client pays with a rewards card, the fee will be higher than a non-rewards card. The card networks,  Visa, Amex, Discover, or MasterCard, also have varying rates. Depending on which network issued a card will determine the rate charged. While the card networks’ fees are unavoidable, they are consistent no matter which processor your firm uses.

In addition to the rates charged by card issuers, payment processors charge their own processing fees. This is where your opportunity for savings comes into play. Some processors structure their fees using interchange-plus, while others use a tiered or bundled pricing structure. Processors may also have batch fees, debit fees, annual fees, voice verification fees, and address confirmation fees. None of these may be revealed to you at the time you sign-up. Some fees, such as PCI compliance fees, are unavoidable no matter who you use as a merchant processor. You may also be surprised by increasing rates when your introductory rate runs out. You didn’t know you had an introductory rate?! If a processor offers you a great rate you want to jump on, be sure to ask the company, “How long will this rate be in effect”?

Another area where transparency is essential is how long it takes for your money to be deposited into your firm’s trust or bank account. Many credit card processing companies won’t tell you unless you ask. It could take as long as 72 hours to access your funds. Other processors can provide next-day funding, including for American Express. While most people are concerned about rates, it’s crucial that you know how long it will take for your processor to deposit your funds.

While several processing companies provide transparency, Lex/Actum offers transparency plus merchant processing designed for law firms. At Lex/Actum, you choose one of four merchant processing account options, all of which feature a simple, transparent fee structure with one low flat-rate each month. Beyond that, all you pay are the fixed costs (known as “interchange and assessments”) that are set by, and paid to, Visa, MasterCard, Discover, and American Express. Lex/Actum promises to never markup or add any hidden fees, such as statement fees, minimum processing fees, customer service fees, batch fees, or any other avoidable fees. All of your firm’s processing will be done with a 0% markup on all Visa, MasterCard, Discover, and American Express rates and fees. Set up time is quick and easy. Merchant account applications are processed immediately, and your law practice is ready to process credit card sales within 24 to 48 hours. For a free statement audit, or to get started, Call us at 321-972-9838.


¹ Law Technology Today – The Hidden Fees of Credit Card Processing – 2017