A Discount Rate is a fee that is charged to the merchant for payment processing services. It is a percentage of each credit card transaction that is charged to the merchant services account by a credit card processing company. This charge is taken from the gross sales amount. It is a primary service fee charged by a processor for handling a merchant’s credit card transactions – the process that takes place when a cardholder makes a purchase with a credit card.
The four components of a discount rate are:
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