Published by Marc Freedman on June 19, 2019
The cost of metered parking has gone up significantly over the last five years. Have you noticed? We have. As a result, your merchant account fees have gone up too. Luckily, we have a solution that can help you cut the cost.
If you bank with a major institution, odds are they are charging an additional $0.22 per metered parking transaction. This is due to a financial legislation reform that occurred in October of 2011 called “the Durbin amendment”. It was originally implemented to “reduce the amount of money that retailers paid banks for customers who used debit cards for their purchases.” This meant that the banks would lose a tremendous amount of money on everyday transactions.
In order for banks to recoup the lost revenue caused by the Durbin amendment, they began charging extra debit fees. As a result, all cards that are associated with branches with over $10 billion in assets, or “regulated” debit cards, are subject to additional charges on everyday transactions. This includes parking meters.
Let’s say you work with a team of twenty people who use parking meters twice per day. That’s an additional $3,200 per year in merchant fees alone. This doesn’t include additional trips, lunch breaks, meetings, or anything else you might need transportation or your debit card for. It adds up quickly. Wondering why you came in over budget this year? This is could be one major reason.
We recently established a strategic partnership with IPS Group Inc. IPS is one of the most established providers of smart meter parking in the country. You’ve probably parked with them before, and may even park with them frequently. Through this partnership, we are able to offer our clients preferred interchange rates of 1.70% +$.05 with both Visa and Mastercard on “regulated” IPS transactions. This can reduce your merchant parking fees by 50%.
Need an example? The New Brunswick Parking Authority was one of the first cities to go live with the new IPS/AMG financial solution. Their goal was to save money and give it back to their customers through improved operations. Executive Director, Mitch Karon saw a difference of 15% in NBPA merchant account fees within the first month. Ohio followed soon after. Here’s a breakdown of what this looks like:
New Brunswick Parking Authority
Transaction value: Approx. $100k
Total number of transactions: Approx. 28.5K
Average transaction amount: $3.50
Approx percentage of regulated debit card transactions: 50%
16% monthly savings compared to previous provider’s total monthly fees
Transaction value: Approx. $280k
Total number of transactions: Approx. 125K
Average transaction amount: $2.20
Approx percentage of regulated debit card transactions: 43%
17% monthly savings compared to previous provider’s total monthly fees
Our clients have noticed a 10% to 35% cutback on their combined merchant account fees, simply by saving at parking meters. The set up is extremely easy, and the savings start immediately. Get in touch and we’ll set your team up to save money on parking.