Visa’s International Service Assessment Fees is one of many assessment fees that Visa charges to assess the increased risks of foreign transactions. The ISA fee only applies when the US-based businesses accept a Visa card issued by a non-US bank.
ISA (International Service Assessment)
The ISA fee applies to all the transactions involving US-based business and a foreign card issuer. Current Visa’s ISA fee is 0.80%. It is a merged fee of the standard assessment fee (0.13%) and the international acquirer fee (0.45%). The Transaction would incur 1.38% in assessment fees. This amount is in addition to the costs of interchange and the processor’s markup.
Most businesses want to pay as less as possible for credit card processing, but let’s get this straight that most of the people usually are not aware if they are getting competitive markup or not. If you want to cut down the costs on the credit card processing, you’ll have to make sure you get competitive markup if not, you’re paying more than you should.
Visa Assessment Fees:
Assessment fees are the methods by which Visa makes money. For example, when you take a Visa card at your business, the transaction incurs assessment fees from Visa, which your credit card processor passes to you. Assessment fees are non-fluctuating for processors; they are not even negotiated with Visa for individual businesses. However, there have been examples of processors tampering with assessment charges. They were adding different types of charges without disclosing it to businesses. Indeed, a payment processor was sued for that practice. Ideally, you’ll work with a processor that passes assessments to you at a cost. We, at Merchant Stronghold, have a legal agreement with acquirers that stipulates the processor to pass charges to you at the right cost. Furthermore, we monitor the statements to ensure clients are billed correctly.
Who pays the ISA?
This comes in brutal because from a merchant’s point of view it might seem fair that customer must pay this additional processing cost. But, since Visa has no way to bill you directly for the ISA fee, they charge it to your processor, and the processor will pass the cost in the monthly account statement.
The Technological advancements have broken down many barriers that previously limited international commerce. In this age of Information, transactions between US-based merchants and international financial institutions are becoming more common, and this trend will only continue to grow in the future. Extra fees for processing card transactions across national borders are, unfortunately, probably here to stay.
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