Heartland Credit Card Processing Fees: What You Need to Know

Why Are You Paying So Much in Credit Card Processing Fees? That's the question many businesses using Heartland services have asked themselves. For businesses, especially small to medium-sized ones, the cost of processing credit cards can cut deeply into profits. Understanding Heartland’s credit card processing fees, as well as how they compare with other providers, can be crucial to managing operational costs.

The Basics: What Are Credit Card Processing Fees?

Credit card processing fees are essentially the cost merchants pay for the convenience of accepting credit cards. These fees cover a range of costs, including interchange fees, assessment fees, and payment processor markups. While this might seem straightforward, the fee structure can get quite complex. For Heartland, the fees often include:

1. Interchange Fees: These are paid to the bank that issued the credit card. The rates are typically set by credit card networks like Visa or MasterCard and vary based on the type of card and the transaction risk involved.

2. Assessment Fees: These are collected by the credit card networks. The fees are typically a small percentage of the transaction amount and are non-negotiable.

3. Processor Markup: Heartland, as the payment processor, adds its own fee to cover the cost of handling the transaction.

Why Are Heartland’s Fees Higher Than Some Competitors?

Heartland's fees tend to be higher than those of some competitors because of its pricing model. Many processors use a tiered pricing model, which can be opaque and lead to fluctuating costs. However, Heartland uses interchange-plus pricing, which is considered more transparent but can appear higher because it itemizes every fee separately. This might make it feel like you're paying more, but in reality, it can sometimes be cheaper because you see exactly what you’re paying for.

Key Fee Categories: A Breakdown

1. Transaction Fees
   Heartland typically charges between 1.5% to 3.5% of the transaction total in processing fees. This depends on factors like the type of card used, whether the transaction is in-person or online, and the merchant’s industry.

2. Monthly Fees
   Heartland may charge a monthly fee, which typically ranges between $25 and $100, depending on the merchant’s size and the volume of transactions. This fee usually covers account maintenance, customer support, and the payment gateway.

3. PCI Compliance Fee
   Ensuring your business complies with the Payment Card Industry Data Security Standard (PCI DSS) is critical. Heartland charges merchants a fee—usually around $15 to $25 per month—to help cover the costs of maintaining PCI compliance.

4. Chargeback Fees
   When a customer disputes a charge, resulting in a chargeback, Heartland charges the merchant a fee of around $25 to $35 per dispute.

5. Batch Processing Fees
   At the end of each business day, transactions are batched and sent to the bank for processing. Heartland charges a batch processing fee that ranges from $0.10 to $0.25 per batch. While this might seem insignificant, it can add up, particularly for businesses with a high volume of daily transactions.

Negotiating Fees: Can You Lower Heartland's Processing Costs?

One of the most common questions merchants have is whether they can lower their credit card processing fees. With Heartland, there is often room for negotiation, particularly if you're a high-volume merchant. Here are a few strategies to consider:

1. Ask for Lower Interchange-Plus Rates
   The plus in interchange-plus pricing is negotiable. If your business processes a significant volume of transactions, Heartland may be willing to lower this percentage.

2. Shop Around
   Even if you're satisfied with Heartland, it’s always smart to compare rates with other processors. Sometimes, simply letting Heartland know that you're considering other options is enough to encourage them to offer better terms.

3. Review PCI Compliance Costs
   Ensuring PCI compliance can be costly, but it’s essential. However, some businesses find that they’re overpaying for compliance services. Look into third-party compliance services that might offer a more affordable option.

4. Eliminate Unnecessary Services
   Heartland offers a suite of services beyond payment processing, from payroll solutions to customer engagement tools. While these services can add value, it’s worth reviewing whether they’re necessary for your business. Reducing unnecessary services can cut down your overall costs.

Is Heartland Worth the Cost?

Heartland positions itself as a premium service, offering transparency, robust customer support, and high-level security. For some businesses, the additional cost is worth it for these benefits. For others, the higher fees can feel like a burden. So how do you determine whether Heartland is worth the cost for your business?

Pros of Heartland

• Transparency: Heartland’s interchange-plus pricing model ensures that you see exactly where your money is going. This can make it easier to identify areas where you might be able to save.
• Security: Heartland is known for its commitment to data security, particularly in terms of PCI compliance. For businesses that handle a high volume of sensitive customer data, this can be a significant benefit.
• Customer Support: Heartland offers 24/7 customer support, which can be critical for businesses that rely on continuous payment processing.

Cons of Heartland

• Higher Fees: Compared to some competitors, Heartland’s fees can seem steep, particularly for small businesses that process a lower volume of transactions.
• Complicated Fee Structure: While the interchange-plus model is transparent, it can be confusing for business owners who aren’t familiar with the intricacies of credit card processing fees.

A Look at Competitor Fees

To better understand whether Heartland’s fees are competitive, let’s compare them with other major players in the credit card processing industry. The table below outlines the typical fee structure for Heartland, Square, and PayPal.

Provider	Transaction Fees	Monthly Fees	PCI Compliance	Chargeback Fees	Batch Fees
Heartland	1.5% - 3.5%	$25 - $100	$15 - $25	$25 - $35	$0.10 - $0.25
Square	2.6% + $0.10	No monthly fee	Included	$0	No batch fees
PayPal	2.9% + $0.30	No monthly fee	Included	$20	No batch fees

As you can see, Heartland’s fees are higher than Square and PayPal in many areas, particularly in terms of monthly fees and PCI compliance costs. However, Heartland’s interchange-plus pricing might be more cost-effective for high-volume merchants, while Square and PayPal’s flat-rate fees can be beneficial for smaller businesses or those with less predictable sales.

Conclusion: Should You Use Heartland for Credit Card Processing?

Whether Heartland is the right choice for your business depends on your unique needs. If transparency, customer support, and security are high priorities, Heartland’s fees may be worth it. However, if you're a small business looking to minimize costs, other providers like Square or PayPal might offer a better value.

Ultimately, it's crucial to review your business’s transaction volume and typical sales to determine which provider will offer the best balance between cost and service.

Remember: Credit card processing fees are a necessary part of doing business, but that doesn't mean you should overpay. Take the time to review your options and negotiate where possible. In doing so, you can ensure that your payment processing costs remain manageable and support your overall business growth.