Businesses can accept debit cards in one of two ways, Pin Debit or Signature Debit.
– Pin Debit requires the cardholder to enter their PIN number to verify a purchase.
– Signature Debit requires the cardholder to sign a receipt.
Pin Debit and Signature Debit have their own unique set of processing fees that apply to the transaction (Industry fees Indigo has no control over).
Depending on the average ticket, one debit processing method has been more cost effective than the other.
– Businesses with a smaller average ticket benefit from Signature Debit (Ticket size less than $12.50).
– Businesses with a larger average ticket benefit from Pin Debit (Ticket size greater than $100).
Recently, three Pin Debit Networks introduced a fee significantly increasing the cost of accepting Pin Debit for businesses. (Again, Indigo has no control over this fee).
Three of the Pin Debit networks (Accel, Star, and NYCE) introduced a 0.95% fee ($95 for every $10,000 in processing volume) that applies to debit processing through the three networks.
For example, the business below has seen a processing fee increase of $650.12 ($68,434.08 x 0.95% = $650.12) due solely to the new fee that Accel, Star, and NYCE introduced.
What was previously a cost-effective method to process debit has become quite costly for the business.
How Indigo helped our customers –
We recognized the impact of this change and immediately began analyzing the costs of all Indigo customers accepting Pin Debit.
After estimating the savings for businesses, we assisted with the conversion from Pin Debit to Signature Debit.
Through Indigo’s proactive campaign, customers who elected to convert from Pin Debit to Signature Debit saved an average of 13.88% of the total processing fees and reduced the monthly effective rate by 0.33% ($165 for every $50,000 in processing volume).
See an actual Indigo customer’s processing fees pre and post conversion below:
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Pre-Conversion (Pin Debit Processing)
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Post-Conversoin (Remove Pin Debit)
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By eliminating Pin Debit, this customer reduced their effective rate by 0.27% – 0.35% or $350 – $500 per month.
Can we help your business?
Indigo continues to review price changes that occur from all networks (Visa, Mastercard, Discover, American Express, Pin Debit, etc.) to determine the best ways all businesses can minimize processing fees.
Contact Indigo today to see how we can protect your business too!