What is the difference between bank fees and merchant fees?
Bank fees are not the same as merchant fees and operate differently. For example, bank fees are financial institution fees that are not subject to GST, while merchant fees are since they provide a service or product and are directly linked to a company or business.
The biggest difference between bank fees and merchant fees, is that bank fees are paid directly to the bank. These fees are charged to the account holder’s statements and don’t change. Common bank fees to consider are annual fees, maintenance fees, and monthly service fees.
Some merchants and large credit facilities also charge monthly and annual fees, but they are subject to GST. Merchant fees are charged to credit cards, which sometimes require a merchant service fee to process the payment with the company. Usually, the percentage for merchant fees is less than 3%, but the exact amount varies from credit facility to credit facility.
There are ways to negotiate both bank fees and merchant fees, but there is no telling if the fees will be waived. Instead, consumers and borrowers should focus on finding banks and credit facilities that charge the lowest fees and low-interest rates. Mortgage House offers free online mortgage lending calculators that are easy to use and consider competitive interest rates.
Bank Fees vs. Merchant Fees Conclusion
Bank fees and merchant fees couldn’t be any more different. When you pay bank fees, they go directly to the bank, however, merchant fees are submitted to the credit facility. Mortgage House lenders are a call away and can walk you through the fees for each loan!