Credit Card Processing

Intuit Merchant Services = Hidden Fees & Fine Print

by Ben Dwyer

Hidden surcharges, fine print and tiered pricing combine to make Intuit Merchant Services one of the most expensive, opaque credit card processing solutions on the market today.

Intuit markets its credit card processing services under a few different brands such as Intuit Payment Solutions, Innovative Merchant Solutions, and GoPayment. However, all of its sales channels use the same pricing and tactics to inflate fees at the expense of small businesses.


Intuit Rates & Fees

Intuit employs tiered pricing, hidden fees, and excessive surcharging to significantly increase its customers’ credit card processing fees.

Concealing True Cost

Intuit uses something called tiered pricing to bill its customers for credit card processing services. Tiered pricing makes it possible for Intuit to completely conceal the rate that Visa and MasterCard charge for a credit card processing transaction behind its own set of rates.

The result is that Intuit’s customers are never shown the actual cost of a transaction, and therefore, they can’t calculate Intuit’s markup.

The Shell Game

To make matters worse, tiered pricing allows Intuit to play a shell game with customers’ rates through something called inconsistent buckets. Banks charge all credit card processors the same interchange fees to process various credit card transactions. Some processors pass these fees directly to businesses using interchange plus pricing, while other processors, like Intuit, funnel the banks’ fees through their own rates.

This allows processors like Intuit to entice customers with bait-and-switch tactics by offering a low rate that only applies to a very limited number of transactions. All transactions that Intuit does not consider “qualified” for the low rate are routed to a much higher “mid-qualified” or “non-qualified” rate.

Intuit abbreviates these surcharge rate categories on merchant statements as MQUAL for mid-qualified surcharge transactions, and NQUAL as non-qualified transactions.

The screenshot below is taken from the statement of an actual Intuit customer and shows the shell game at work. You will notice that the lowest rate on the statement is 2.48% (shown as .0248), but most of this customer’s volume was charged at a rate of 3.62% (shown as .0362).

Intuit considered only about 21% of this customer’s total volume as qualified, and 80% of its volume was surcharged.

Non-Qualified Fees

This type of pricing is misleading at best, and enables hidden credit card fees in the form of non-qualified surcharges. Take a look at CardFellow’s credit card processing guide to learn more about how credit card processors like Intuit use tiered pricing to manipulate pricing.

The Fine Print

It takes reading the fine print carefully to get an accurate picture of the costs associated with Intuit Merchant Services.

The screen shot below was taken directly from Intuit’s Web site. The pricing table looks simple enough, but the asterisk following the sentence in the upper right-hand corner that that says, “All transaction fees included” suggests exactly the opposite is true.

Asterisk denoting Intuit's Fine Print

A scroll to the bottom of the page reveals a link that says, “*Important Disclosures,” and when clicked, drops down a series of five bullet points. The second, third and fifth bullet points change pricing substantially, and they are outlined below for clarity.

Intuit Pricing Disclosure Link

Point #2: Bait-And-Switch in Action

The second bullet point in Intuit’s fine print says:

Card-swiped rate applies to qualified swiped Visa/MC/Discover network transactions and requires the GoPayment card reader. Most rewards, corporate and special card types are considered non-qualified transactions and merchants will be charged the key entered rate.

In other words, the 1.64% rate shown in the table above only applies to a very small number of swiped transactions. All other transactions will be charged at the 2.47% rate.

Point #3: Adding Hidden Fees

The third bullet point in the fine print actually adds a completely new rate that is not disclosed in the pricing table.

“Key-Entered Rate” will be charged on all qualified manually keyed Visa/MC/Discover Network transactions that have verified addresses. All Visa/MC/Discover network transactions that do not meet the requirements for card-swiped and/or key entered rates will be charged a non-qualified rate of 3.91%.

In other words, Intuit Merchant Services will charge a rate of 3.91% for all transactions that don’t meet its criteria for the 1.64% or 2.47% rate categories. However, the qualification criteria for each rate category are not specifically defined.

Point #5: Adding Even More Hidden Fees

The fifth bullet point in the fine print adds an annual PCI fee that is also not disclosed in the pricing table.

Credit card companies require merchants to be PCI compliant in order to meet the minimum data security standards designed to protect customer card information. The PCI Compliance fee … is based on the estimated number of transactions per year, and will be charged annually beginning in the 4th month of service: $35 for 1-24 transactions, $50 for 25-99 transactions, or $100 for 100+ transactions. Different fees may apply to merchants who process in excess of 20,000 transactions per year.

Along with a hidden 3.91% rate, Intuit Merchant Services also charges a hidden annual PCI.

Quickbooks Credit Card Processing

Intuit’s popular Quickbooks account software is what causes many businesses to begin utilizing Intuit merchant services. It doesn’t take long before these businesses realize that the convenience of Quickbooks comes with a very hefty price tag.

Software applications, called Quickbooks plugins, exist that allow credit card processors other than Intuit to integrate with various versions of Quickbooks. These plugins allows businesses to enjoy the convenience that Quickbooks provides without having to utilize Intuit’s costly merchant services.

CardFellow has helped hundreds of businesses switch from Intuit credit card processing to a processor with far more competitive pricing, and in almost all cases, businesses are able to continue using Quickbooks to process credit cards. Sign up for free today at CardFellow to get instant competitive quotes from multiple credit card processors.

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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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2 COMMENTS

  1. from chris, on February 3, 2013

    I want to use cc processing with my qb pro accounting software. I also want to use it with my quickbooks p.o.s. Intuit rates are too high. other cc processing doesn’t integrate with my pos.

    • from Ben, on February 4, 2013

      Hi Chris,

      Processors here in CardFellow’s marketplace are capable of integrating with most Quickbooks applications, including Quickbooks POS for Windows. You can sign up for free to receive free quotes.