Intuit GoPayment drops per-transaction fee – is it now a good deal?

May 1, 2011

May 1, 2011

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I just saw on TechCrunch that Intuit has updated their pricing for GoPayment. It appears that Intuit gave an exclusive to TechCrunch because I don’t see the changes anywhere else, including on their own (incredibly annoying) website. A couple of weeks ago, we answered the question “Should you choose Intuit GoPayment” with a resounding Hell No! The […]

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I just saw on TechCrunch that Intuit has updated their pricing for GoPayment. It appears that Intuit gave an exclusive to TechCrunch because I don’t see the changes anywhere else, including on their own (incredibly annoying) website.

A couple of weeks ago, we answered the question “Should you choose Intuit GoPayment” with a resounding Hell No! The question is, does this new pricing change anything?

TL;DR – the new pricing is bit of a scam, not unlike what we see from most other payment processors. For a very small portion of transactions you get a pretty good rate under the new pricing (if you pay the $13/month for the upgraded plan), but because they use tiered pricing you’ll actually get the non-qualified rate (3.7%) most of the time. Our customers were seeing the non-qualified rate on average on 70% of transactions before they switched to Interchange plus pricing. “Non-qualified” means whatever the hell they want it to, and ultimately the vast majority of your transactions/cards will fall under that pricing tier and you’ll pay 3.7% on them.

FeeFighters know tiered pricing is NOT the way to go because it’s confusing and you don’t know what you’ll be paying. Intuit further hides their fees in the pricing schedule:


It hasn’t yet been updated, but let’s just assume that at some point they will realize their website is wrong and get rid of the 15c transaction fee. Their pricing is still higher than Square’s in almost every instance. The key is that tiered pricing lets them decide what is “qualified” and what is “unqualified.” The way they do this and still be profitable is the same way that we see our customers statements from companies that use tiered pricing – Intuit chooses the tiers, and almost all cards will fall under the non-qualified pricing structure.

Let’s investigate what an Austin pedicab owner would pay if they actually had to use Intuit’s GoPayment solution… Let’s assume they do more than $1000/month and thus have a $13 per month fee.

For my Chase Platinum rewards card, the pedicab driver would pay 3.7% (non-qual authorization fee) on a $10 transaction, or 37 cents.
With Square, they’d pay a flat 2.75%, or 27.5 cents. Additionally, the pedicab owner would pay $13/month for the account.

That being said, there are some advantages to the GoPayment card reader. It is more secure (until Square beefs up their security), but more importantly, it’s also easier to swipe and Square has some restrictions on funding. If you’ve ever used a Square reader you know that you sometimes have to swipe it several times to get it going. Square can hold payments over $1000 for up to a month, which doesn’t work well for many contractors. An option that we recommend (where you won’t have either of those problems) is the ROAMPay reader with a standard merchant account. (Intuit uses a re-branded ROAMPay reader, but it is tied to their merchant services) While it still doesn’t make sense for the pedicab guy, it makes a lot of sense for a contractor, because you can get interchange plus pricing from FeeFighters, with a much lower percentage based fee that, even when coupled with a transaction fee makes a lot of sense for larger ticket items. Here’s a calculator to decide whether ROAMPay or Square makes sense. We think both are great options, it just depends on your needs.

We’d be happy to help anyone make a decision – give us a shout!

 

Kay says:

Hi there, I’m so glad I found this article/you! I discovered Squareup last week and thought I found something “precious”, and the more I googled, I found Intuit GoPayment…

Now, we have a website, standard merchant account, 3 retail stores. Our peak season is Aug-Sept (only), but our sales can go up to 6 digits. Not accepting credit cards in retails…but would like to take it during the peak season. Therefore I don’t want the traditional machine and my employees are from last generation so they have hard time operate computers…so my best bet would be these readers using with iphone/ipads, easy.

These things are so “easy” that scares me, how it’s so complicated when I first applied to the regular merchant account! Are all these reliable in fundings?

Can you suggest me which would be the best fit for us??

Thanks!

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