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Merchants will use credit card services in order to expand on the amount of customers who can purchase products from the business. However, opting to accept credit cards will mean the merchant must comply with numerous service fees from the credit card companies. This is because the technology and services transferring money from customers to the merchant accounts requires the credit card companies to work as a third-party. As a result, these third parties levy credit card processing fees for revenue and payment for their services.

When merchants look at their merchant statements, they may see many different service fees applied to them. Some of them seem straight-forward and easy to understand, while others almost seem mysterious. One fee that is sometimes misunderstood is the PCI fee.

PCI stands for Payment Card Industry. This fee is levied to the merchant at the end of the fiscal year. It is fee that is assessed from the previous year’s transactions. Sometimes a credit card provider may charge the PCI fee per month, but they are usually given at end of the year. The PCI fee is meant to pay for all the security measures the during credit card processing. Whenever a merchant accepts and swipes a credit card, the customer and the merchant’s financial information can be hacked or stolen by a malicious third party. PCI fees help provide revenue to the credit card company’s security and compliance departments.

Interestingly, the PCI fee is levied by the PCI Security Standards Council, an organization that was formed in September 7th, 2006, by the major credit card companies. The companies include JCB, MasterCard, Visa, Discover and American Express. Any merchant that accepts the cards of these PCI Security Standards Council companies will be charged the PCI fee. The PCI fee is administered to companies based around four tiers. PCI Merchant Level 1 is for companies that conduct over 6 million transactions a year on those cards. Level 2 is for merchants who process 1 to 6 million transactions on those cards. Level 3 is for merchants who process 20,000 to 1 million transactions a year on those cards. Finally, Level 4 is for businesses that conduct fewer than 20,000 transactions a year. A majority of small businesses would most likely fall in Level 4, while large, multi-national e-commerce sites could be Level 1 merchants.

PCI fees will usually appear at the bottom of the merchant accounts statement. However, some companies may combine the PCI fees with other fees. If a merchant is concerned with the amount of some fees or how much their PCI fee is, they can contact the credit card provider and ask for more details.