Credit Card Processing

Intuit Credit Card Processing = Very Expensive!

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Based on the countless Intuit merchant account statement analyses we have done here at CardFellow, we have found Intuit’s credit card processing charges to be 40% – 50% greater than the rates businesses receive in our free marketplace.

Intuit is best known as the maker of the popular Quickbooks accounting software, and as the provider of the GoPayment mobile processing application. If the company’s credit card processing keeps going as it is, Intuit will also become know for exorbitant credit card processing charges and excessive downgrades.


Quickbooks Credit Card Processing is Expensive

Intuit’s popular Quickbooks accounting software makes it possible for users to process and record a credit card transaction in one easy step. But this convenience comes with a very hefty price tag.

Intuit knows that competition from other credit card processors will drive processing costs down, so the company designs Quickbooks so it will only work with Intuit’s own credit card processing service. By eliminating competition Intuit is able to charge excessive fees.

However, just because direct integration with QuickBooks requires an Intuit merchant account doesn’t mean you can’t get your data into QuickBooks in other ways. You can use other payment processors and

Learn How to Export Your Data to QuickBooks.


Opaque Pricing

Quickbooks enables Intuit’s exorbitant fees, but tiered pricing is what makes it possible for the company to advertise rates that appear far more competitive than they actually are. To understand how Intuit uses tiered pricing to conceal high rates we first need to look at the wholesale cost of credit card processing.

The banks that issue credit cards charge interchange. Interchange fees are the same for all businesses and processors. They represent the lowest possible rate for a given transaction.

If you’ve strolled through the blog here at CardFellow, or better yet, used our service to compare credit card processors in minutes, you know there are two basic forms of credit card processing pricing called interchange plus and tiered.

Interchange plus eliminates hidden credit card processing fees and is relatively inexpensive because it separates a processor’s markup from the interchange fees charged by banks. Intuit only offers interchange plus pricing to large businesses with substantial processing volume.

Tiered Pricing

Instead, Intuit uses opaque and expensive tiered pricing. Tiered pricing allows Intuit to charge its customers based on its own rates called QUAL, MQUAL and NQUAL while paying interchange fees to banks behind the scenes.

Each one of Intuit’s pricing tiers has a corresponding rate. For example, QUAL, MQUAL and NQUAL may carry rates of 1.60%, 2.60% and 3.60%, respectively.

With full control of rates Intuit is able to dictate the pricing tier to which a business’s credit card transactions are routed. For example, Intuit may route a regular consumer credit card to the QUAL tier and a reward credit card to the NQUAL tier.

When Intuit processes a transaction at the higher MQUAL or NQUAL pricing tier the transaction is said to have downgraded. While it’s true that downgrades happen at interchange (how Visa and MasterCard classify a transaction), in the case of tiered pricing, many downgrades also occur at the processor level (Intuit gets to downgrade any transaction it wants).

Unfortunately, Intuit has failed to disclose its ability to influence downgrades on the company’s Web site.

Intuit & Excessive Downgrades

Intuit makes more money when it routes a transaction to MQUAL or NQUAL because these tiers have higher rates than the lowest QUAL tier.

When talking with a prospective customer it’s not uncommon for a salesperson to claim that the QUAL rate will apply to most transactions, and only a small number of transactions will downgrade to the higher MQUAL and NQUAL rates.

The countless analyses of Intuit merchant accounts statements that we have done here at CardFellow prove the exact opposite is true. In most cases, Intuit downgrades an excessive number of transactions to the higher MQUAL and NQUAL rate tiers.

In the following examples we will look at actual Intuit processing statements sent to CardFellow by companies that used our free marketplace to get instant credit card processing quotes. Each company reduced credit card processing fees more than 50% by leaving Intuit.

Intuit Excessive Downgrades: Example #1

This snippet shows an Intuit merchant account statement for a medical office. Before switching from Intuit and lowering its fees by more than 50%, this business was using Quickbooks to swipe virtually all credit and debit card transactions.

Example #1 Intuit statement excessive downgrades

Intuit priced this business with rates of 1.60% QUAL, 2.60% MQUAL and 3.60% NQUAL. Total Visa processing volume for this month was $31,550.03, but Intuit only considered $2,735.02 as QUAL. Intuit downgraded a whopping 90% of gross Visa sales volume to the NQUAL pricing tier!

We checked every conceivable reason for such excessive downgrades such as card type, software issues, delayed batching and more. We later found that Intuit was simply downgrading virtually every type of transaction except those involving a swiped debit or core (non-reward) consumer card.

Intuit Excessive Downgrades: Example #2

This next example of excessive Inuit downgrading is taken from the statement of an online business that also used CardFellow’s free service to lower fees by over 50%. Like the business from example #1, this company was processing transactions correctly and should not have experienced this many downgrades as a result of interchange qualification. The excessive downgrades were caused by Inuit routing the vast majority of transactions to the NQUAL pricing tier.

Example #2 Intuit statement excessive downgrades

As you can see, Intuit downgraded a staggering $62,460.29 to the NQUAL rate. That’s 69% of gross sales volume!

Save Money by Switching from Intuit

Despite Intuit’s best efforts other processors are able to offer credit card processing for Quickbooks through software add-ons called plug-ins. Plug-ins are often proprietary and have varying degrees of effectiveness. Some may require double-entry, while others boast functionality that is virtually identical to the native Quickbooks processes.

It may take a little extra homework on your part to weigh the Quickbook plug-in options available, but your wallet and working capital will thank you. Need help figuring out your options? Try CardFellow’s free credit card processing price comparison tool

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Ben Dwyer

BY Ben Dwyer

Ben Dwyer began his career in the processing industry in 2003 on the sales floor for a Connecticut‐based processor. As he learned more about the inner‐workings of the industry, rampant unethical practices, and lack of assistance available to businesses, he cut ties with his employer and started a blog where he could post accurate information about credit card processing.As the blog gained in popularity, Ben began directly assisting merchants in their search for a processor. Ben believes in empowering businesses by providing access to fair, competitive pricing, accurate information, and continued support. His dedication to transparency and education has made CardFellow a staunch small business advocate in the credit card processing industry.

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12 COMMENTS

  1. from Theresa, on August 13, 2017 11:16:23

    Pay Pal has put my last 3 payment on pending. The first time it was for an $800 purchase that was face to face. . Because of the pending issue, the buyer wanted to cancel the transaction but Pay Pal wouldn’t let him. He was going to pay me cash instead. He called customer service and we both talked to them. After being very forceful, papal pushed the payment thru so we could complete the transaction. This took a little over 1 hour to complete. Since then they have place 2 more of my received payments on pending. The 2 payments were made on my website using the buy it now button. I have since lowered my deposit amounts by half on my website because of this problem.

  2. from Darrell G. Rademacher, on June 9, 2016 17:47:38

    My wife showed me the current charges for a small business with Intuit of being now 5%! The Mafia offers better rates!!!

    • from Ellen, on June 14, 2016 09:18:39

      Hi Darrell,
      Yikes! If your wife is interested in finding a lower cost solution to fit her needs, I’d highly suggest she try out our free quote comparison tool. It’s available here: https://www.cardfellow.com/sign-up.

  3. from Susan, on April 4, 2015 07:51:04

    I too am having a great deal of issues with QB Processing due to an error I made where I did not void a transaction instead refunded within the first 2 hours of making the error. I did not know the void rule!! It has now cost me greater than $4600.00 in QB Fees, 7 returned Check Fees at my bank due to the excessive debuting of these fees. I am a Small Business who could be put out of business from this. I have called countless places for advice on this matter to no avail. I say buyer beware of QB processing and if you use it make sure to void a transaction in the first 24 hours and refund thereafter.

  4. from JAN R, on January 12, 2015 14:03:25

    Disgusted with countless hours on hold with useless service agents at Intuit Merchant Services. This company is unable to provide a Statement thru Dec 31st, 2014, and now January 12th, 2015 on hold for one hour, still no on line statement of fee accounting.. I am shocked at the 04.1938% nearly 4.2% fees, and no accounting statement mid January , no explanation from customer support or manager. They are scamming, giving run around, and keep repeating I must wait indefinitely for December Statement . I am canceling processing service, Intuit is excellent at thievery, deceit and unlawful business practices paramount to fraud. They are in violation and non compliant due to gross incompetence.

  5. from Guy Logan, on March 26, 2014 13:24:56

    Thank you for the information on Intuit. I, too, have had frustrating problems resolving issues with Intuit credit card processing. I have spent way more time than I expected, and I’ve found their people to be bureaucratic and unhelpful. I am looking for alternative credit card processing providers. I’d give Intuit a 3 on a scale of 1-10 and would not use them again.

  6. from Rob, on December 19, 2013 16:39:03

    I too am learning quickly of how expensive these extortion rates are for using Quickbooks Online payments. I just tallied 3 recent transactions and the total fees QB took were $171.68 for processing 3 payments. Now while I’m on hold, 20 mins estimated they say, I am writing to let anyone know that the convenience is not worth these rates. They also take up to a week to get the funds to your bank account whereas my local bank merchant account is nearly instant. Shame on this sorry company that has had my business for 13 years.

  7. from Charles Surginer, on April 30, 2013 16:19:12

    I found out the hard way that Intuit is not only very expensive, they provide no help to resolve problems. Now that I have decided to move away from them, they have informed me that I now have to pay $295.00 for cancelling the service.

    Think long and hard before selecting Intuit for your credit card processors!

    • from Tammy, on June 6, 2013 10:53:48

      I’m having problems with them also. They flag every transaction that I submit. I have a busy catering business and can not wait for them to verify most transactions. Did this happen to you also? I’m new to them and incredibly frustrated.

  8. from HB, on March 22, 2013 13:41:09

    Am trying to do my homework and getting deeply discouraged. Many of our customers prefer to pay for their roof repair or new roof with a credit card and we always have to pay the higher tiered fees. Who can I talk to who will give me accurate information regarding the best/lowest cost credit card processing company? It seems all of them bait-and-switch when it comes to fees, and what you are quoted does not reflect reality. It becomes way too expensive, and ultimately the customer pays or we lose money. Any help out there?

    • from Ben, on March 29, 2013 14:04:24

      HB, you’re looking at the help. CardFellow’s sole purpose is to help businesses like yours find and keep a competitive, honest credit card processing solution. Our service is completely free, and if you’re currently using Intuit, CardFellow can help you lower your credit card processing fees by 40% or more. We help business just like yours every day. Learn more here about what CardFellow is and how CardFellow works.

  9. from TC, on October 30, 2012 12:33:30

    Great article, good research. Thanks guys/gals!