Set Up Processing Fees

Last Updated: February 02, 2024 03:28

Introduction

The Processing Fees feature can be enabled to automatically apply a processing fee to any payment a client makes using a credit card. This is only applicable for card payments and it cannot be used for bank transfers, cheques, POS, etc.

Important: Merchants are allowed to add surcharges whenever allowed by federal and state law. If they do, however, they must clearly notify customers with conspicuous signage or distinct terms in written agreements before charging customers.

Prerequisites:

Set up a Payment Gateway

Set Up Processing Fees:

Go to Settings/Billing Settings/Billing Rules and find the We'll generate processing fees section.
Enable the Automatically option. That will enable the automatic fees added to charges paid by credit card. More fields will be displayed, allowing you to finish the setup of automatic fees:
- Plan - Select a plan that will be used as the template plan for processing fees. This allows you to specify the payment account that you would like to have these fees associated with. Read more about how you can add billing plans.
- Fee - this section allows you to set up a fee in percentage (%) of the invoice charge. There are four available fields - Default, Visa, Mastercard, and American Express. Each one specifies a certain fee, depending on the type of card that is used for the payment. The Default fee will be used for any other cards or cards without a specified fee percentage.

Once enabled, the fees will be added to the relevant payments and they will become visible in the order summary.

Processing Fees Explained

1. When the invoices are automatically generated, a processing fee will only be added to the invoice in certain conditions:

If you have a Card payment method added and your preferred payment method is set to Auto, a fee will be generated. If you don't have a Card added, there will be no fees in the invoice.
If your preferred payment method is set to a Card (for example Stripe Card), a fee will be generated regardless if you have a Card added or not.

2. If you are manually generating an invoice for a customer without stored card details, and you cannot specify what their payment method would be upon creating that invoice (in case you don't know if they'll add their card details or not), we won't apply any processing fees.

3. The invoice processing fee amount is currently calculated over the invoice total amount, regardless of the amount, charged by a card.

4. In those cases where the customer adds their payment details after the invoice was generated, and the invoice hasn't been paid yet, we’ll automatically add or remove the processing fees depending on the payment methods used to charge the invoice.

5. If you turn off the processing fees feature but have used it for a while, the following logic will apply to all existing invoices:

If an invoice has a processing fee but it’s been paid with another method we’ll remove the fee
If an invoice doesn’t have a processing fee and you try to pay with a card - no fees will be added

6. If you have a billing lock date enabled, an invoice can still be paid but is otherwise locked. This prevents us from adding a processing fee to such an invoice. In such cases, you will receive a clear notification in the admin portal when trying to charge the invoice, and you will also receive an email notification.

7. In the case of adding multiple (i.e. partial) payments to an invoice, the method of the 1st partial payment decides whether a processing fee will be added. Examples:

If the first partial payment method is CC -> a processing fee will be added
If a second payment is made with a CC but the first was an alternative method (DD, manual payment, etc..) -> no processing fee will be added

8. When an alternative payment method is used (PayPal, Hosted Payment Gateways, etc..):

we don’t apply processing fees
we remove processing fees if there are any already applied