Lower Processing Fees
Payment gateway fees are the cost to the institution owner when processing fee payments. Educational institutions that accept credit card and online payments pay a small transaction fee, known as a payment processing fee.
An interchange fee is a credit card issuer (such as Discover, Visa, and MasterCard) that charges the recipient every time a customer pays by credit card. The purpose of the exchange fee is to assist the issuing bank with the cost of handling and the risk of approval of the sale as well as to assist in any fraudulent transactions. Interchange fees are set by each network and issuers may vary. The interchange rate is also affected by the type of card and the manner in which the merchant accepts money (swipe, type online or at a terminal).
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In order to process credit card payments for an institution, the credit card network must be interconnected with the merchant account. The merchant account allows a business to accept credit card payments, and merchant account providers deposit money into the merchant's bank account at regular intervals.
The amount of the payment gateway fee will also depend on how the card is processed. Students can use their cards, phone transactions, online transactions etc. Payments made by swiping a card at an ATM are less risky and therefore lower fees are charged.