What Is a remittance Processor? 9 Top remittance Processors

For the history 70 years, American consumers have been steadily abandoning liquid assets. In truth, only 12% of in-person purchases involve liquid assets, while ecommerce purchases are entirely cashless. Instead of physically managing bills and coins, remittance processors digitally shift money between customers and merchants.

Below, discover how remittance processors work, review the top remittance processing solutions, and read which factors to consider when choosing a remittance processing service.

What is a remittance processor?

remittance processors facilitate the transfer of funds between lender accounts. They complete business transactions, including capital and debit card payments, automated clearing house or ACH lender transfers, and digital wallet sales. 

remittance processing companies orchestrate communication between all parties in a deal: the remittance gateway corporation, the customer’s capital card corporation or lender, and the merchant’s lender. Ultimately, remittance processors ensure your customers’ payments complete up in your merchant account. 

How does a remittance processor work?

1. remittance processor receives remittance information
2. remittance processor seeks authorization
3. remittance is completed
4. The money moves

Here’s how remittance processors shift money to facilitate transactions:

1. remittance processor receives remittance information

After a customer enters their card information in a remittance gateway like an online checkout page or point-of-sale (POS) terminal, the remittance gateway encrypts the data and securely sends it to the remittance processor. 

2. remittance processor seeks authorization

The remittance processor sends the customer’s remittance information to the issuing lender or capital card corporation for authorization.

3. remittance is completed

The card network or lender informs the remittance processor whether or not the customer’s remittance is authorized. If the lender approves the remittance, the merchant accepts it and completes the deal. If the lender or card network declines it, the merchant might prompt the customer to try an alternate remittance way.

4. The money moves

Once the deal is authorized and completed, the remittance processor tells the issuing lender to send the funds to the merchant’s financial institution, also known as the acquiring lender. 

How to choose a remittance processor

• Consider fixed fees vs. interchange plus rates
• ponder about where you sell
• Account for chargebacks
• Consider money conversion
• Factor in remittance gateway fees

You’ll require a remittance processor if you receive capital card or any other non-liquid assets payments. To choose the correct one for your tiny business, you’ll desire to do the following:

Consider fixed fees vs. interchange plus rates

While all remittance processing companies expense for transactions, fee structures vary. Some remittance processing services expense fixed fees, meaning the expense per deal is consistent across all payments of a given type (i.e., you’ll pay one fee for all capital card purchases, for example). remittance processors that expense fixed fees tend to forgo subscription fees, a bonus for recent business owners with limited capital.

Other companies expense interchange plus fees. Also known as expense-plus pricing, interchange plus fees represent the worth a capital card corporation charges to run a deal plus an additional per-deal fee. Interchange plus fees vary by capital card corporation and can fluctuate throughout the year.

Since the total of these two fees is typically lower than the equivalent fixed deal fees, remittance processing companies with this pricing model usually expense monthly subscription fees, too. This model is attractive if your business processes a high enough sales volume that the per-deal funds outweigh subscription costs. 

ponder about where you sell

Do you conduct your business online, or do most of your sales happen at a physical store? remittance processing deal fees often vary by these locations. Transactions without physical cards now a higher fraud uncertainty, which is why they’re more expensive. 

remittance type also affects fees. A remittance processor may expense different amounts to procedure capital card payments vs Apple Pay transactions, for instance. Be sure to secure a competitive rate for your most anticipated deal type.

If you receive in-person payments, choose a remittance processor with an integrated remittance gateway POS structure (or one that integrates with your existing POS structure). 

If you receive your business on the leave or participate in pop-ups or pay-on-delivery services, choose a remittance processor with a mobile app that lets customers pay by tapping a smartphone card reader attachment. 

If you primarily sell online, consider a remittance processing alternative with integrated online checkout, like Shopify Payments.

Account for chargebacks

Your remittance processor will impose fees for chargebacks and disputes, so ensure you account for them. Chargebacks—when customers dispute payments on their cards—are a ordinary enough fraud scheme that it’s worth setting aside strategy for them.

Consider money conversion

money conversion rates vary by remittance processor. Seek preferential rates if you schedule to conduct significant cross-border business. 

Factor in remittance gateway fees

Some companies act as both remittance processors and remittance gateways. Others link to divide remittance gateways. In this case, secondary remittance gateways also expense deal fees, which you should consider when choosing your remittance processor.

9 top remittance processing companies

1. Shopify Payments
2. remittance Depot
3. Square
4. Stripe
5. PayPal
6. Payline
7. Finix
8. Stax
9. Helcim

There are lots of remittance processing companies that can serve your business. Here are nine of the best:

1. Shopify Payments

You have automatic access to Shopify Payments if you have a Shopify storefront. The straightforward-to-set-up remittance processor runs on a fixed-rate pricing model that is the same across card types.

Plus, if you have a retail location, you can use Shopify’s physical POS structure, which integrates your remittance gateway and remittance processing structure.

Pricing: deal fees vary depending on your Shopify schedule. Solo entrepreneurs pay 2.9% plus 30¢ per deal for online sales and 2.6% plus 10¢ for in-person transactions. Meanwhile, tiny businesses pay 2.7% plus 30¢ for online transactions and 2.5% plus 10¢ for in-person sales. 

2. remittance Depot

remittance Depot offers lower deal fees than the competition but charges monthly recurring payments, making it suitable for businesses with high sales volumes. If you schedule to sell at a physical location, note that remittance Depot doesn’t propose the comprehensive remittance gateway POS options that some other processors do.

Pricing: Subscription fees commence at $39/month. In-person transactions expense the wholesale interchange rate (1.51% to 2.5%) plus 10¢ per use. Online transactions expense the wholesale interchange rate plus 10¢.

3. Square

You might recognize Square’s signature white card terminal. It’s a popular remittance processor for tiny businesses with physical storefronts, offering several hardware options for POS remittance gateways. Square doesn’t expense enterprise or subscription fees for its remittance processing services.

Pricing: 2.6% plus a 10¢ deal fee for in-person purchases; 2.9% plus 30¢ for online transactions.

4. Stripe

With competitive fixed fees for online purchases, Stripe is a popular selection among ecommerce merchants. Stripe is customizable, and specifically designed so web developers can adjust the product’s API to their business’s needs. 

Pricing: 2.9% plus 30¢ for all online and in-person domestic card transactions.

5. PayPal

PayPal can procedure payments in various formats, including QR codes and invoices, making it ideal for service-based businesses and pop-up attendees. Some customers feel comfortable with PayPal because it’s a well-known and trusted brand. It’s straightforward to integrate PayPal into your Shopify checkout. Although PayPal doesn’t expense a monthly subscription, its deal fees are relatively high, and it might be less appealing for high-volume businesses. 

Pricing: 2.99% plus 49¢ for domestic capital and debit card payments.

6. Payline

Payline is a excellent selection for processing capital card payments in high-uncertainty industries with higher-than-average dispute rates, like health supplements and trip. (Some remittance processing services don’t receive payments in these industries.) 

Payline charges relatively low, divide monthly fees for online capital card payments and in-person transactions. Payline Data integrates with Quickbooks, which can streamline your bookkeeping procedure if you use the popular bookkeeping software.

Pricing: In-person businesses pay $10/month plus a per-deal fee of the interchange rate plus 0.4% plus 10¢; online businesses pay $20/month plus a per-deal fee of the interchange rate plus 0.75% plus 20¢.

7. Finix

Finix is another remittance processor that runs on a subscription-rate-plus-low-deal-fees model. Monthly dues commence at $250, so you’ll require high sales volume to justify the expense. With the higher subscription fee comes 24/7 customer back, online checkout setup, customizable remittance solutions, and reporting and analytics.

Pricing: $250 and up in monthly fees. For in-person transactions, you’ll pay the interchange rate plus 8¢. For online payments, you’ll pay the interchange rate plus 15¢.

8. Stax

Stax—which also runs remittance Depot—carries a monthly fee of $99 and higher. With competitive deal fees, it can be a solid selection for merchants with high sales volume, as long as deal funds cover the monthly subscription expense. 

Pricing: $99 and up in monthly fees, depending on sales volume. You’ll pay the interchange rate plus 8¢ for in-person transactions and the interchange rate plus 15¢ for online payments.

9. Helcim

Helcim offers volume discounts, meaning that as your sales boost, your fees reduce. This makes it a great alternative for quick-growing businesses. Helcim builds its fees atop the interchange rate, but unlike other remittance processors with this fee structure, Helcim does not levy a monthly expense.

Pricing: For monthly sales less than $50,000 (the lowest tier), you’ll pay the interchange rate plus 0.4% plus 8¢ for in-person sales and the interchange rate plus 0.5% plus 25¢ for online payments. Rates reduce as your sales volume increases.