Apparently Moneris wasn’t satisfied with only making 1% on card types that don’t qualify for the minimum discount rate.
A lot of Moneris merchants will see their non qual rate go from 1% to 1.05% in June. It may seem like a small increase, but when you consider the portfolio that Moneris has, adding 5 basis points will resuly in a uptick in revenues.
Here is the thing; Moneris knows that the merchants that will see this rate increase have little understanding of their non qualified model. A lot don’ even read their statement.
Most small business merchants are not aware that there is a rate adjustment for credit card types that don’t qualify for the negotiated discount rate. Corportate cards, Visa Infinite, MasterCard High Spend and keyed transactions do not qualify for the minimum discount rate.
Moneris is making good money on transactions that do not qualify. Their cost on these card types is anywhere from 0.11% - 0.46% for Visa and 0.13% - 0.70% on MasterCard so they have a minumum 0.35% hedge built in. On most card types they are making an extra 0.75% !!
This creates a great opportunity for competitors to take this business away.
