Tiered pricing splits the fees you pay per transaction into three tiers, which are based on how you process the card and the associated risk of the transaction. The credit card processor assigns the transaction into one of the following tiers:
- Qualified – lowest risk and lowest cost per transaction
- Non-qualified – highest risk and highest cost per transaction
If you run a transaction incorrectly, or it has a higher risk associated with it, the transaction is downgraded to a mid-qualified or non-qualified tier. We recommend that you avoid running downgraded transactions as they have a higher processing cost.
We calculate your card transaction fees once per calendar month based on the tiers used by the processor. We deduct them with your account fees from the money funded to your bank account.
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Tags: tiered, account fees, card transaction fees, downgraded transaction, high risk, statement