PayPal makes its revenue by charging merchants a fee related to purchase prices.  These fees typically range from 1.9% to 2.9% in addition to a fixed $0.30 rate.  These fees should be interpreted by the Federal Reserve as interchange fees.

The Federal Reserve central bank has suggested capping interchange, or “swipe” charges, for each debit-card transaction, to $0.07 to $0.12 each.  This will replace the previous formula which charges merchants about 1% of the purchase. But now the Federal Reserve has indicated that they are questioning whether those “caps” should apply to PayPal. So as PayPal grows globally, will the US Government make an exception to the rule to keep PayPal satisfied while other merchant service companies work under a more limited approach?

PayPal is one of competitors and we welcome the challenges. We know we can beat their prices, service and dedication but don’t handicap us just because they accept more merchants. The reason they have more merchants is because of their higher rates allow them to take riskier clients.

At ClearChoice we use such things as credit ratings, history of business and other items to determine our Under Writing Approval.

While this may take longer, we believe that money and transactions should be taken seriously because a lot is at stake, for both the merchant and customer. We are not in the click and go business we are in the secure transaction business.