Fixed Acquirer Network Fee (FANF): What It Is and How Much it Costs
By Jasmine Glasheen
We get it. No retailer wants to see strange fees popping up on their statement, and the Fixed Acquirer Network Fee is a prime example of an additional fee tacked on by a credit card company that can take you by surprise if you aren’t ready for it.
If you recently started a small business and are seeing the Fixed Acquirer Network fee on your statement for the first time, you’re probably wondering what exactly you’re looking at, what services are provided for the FANF, and whether it can be avoided. On top of everything else, the payment structure for Visa’s FANF regularly changes so it can be a challenge to stay on top of how much you’re going to be expected to pay.
So with no more ado, let’s demystify Visa’s Fixed Acquirer Network Fee once and for all.
What is FANF?
Visa’s fixed acquirer network fee is an additional processing fee that Visa began tacking on to debit and credit card transactions in July of 2012. FANF used to be called the Network Participation Fee (FNF) and it is, in short, an additional fee that Visa began charging to recoup some of their profits lost when The Durbin Amendment came into effect.
The Durbin Amendment was put into place to save customers money on credit card fees, but the additional fees that credit card companies tacked on to negate their losses (such as Visa’s FANF fee) essentially prevented the amendment from having too positive of an impact. It’s important to understand that FANF isn’t determined by your payment processor and they don’t get the profits from it — it’s a credit card company thing. Because of this, no payment processor has control over how much you are charged.
Who charges FANF?
Visa is the only credit card company that charges FANF. However, MasterCard has its own version called the Domestic Other Non-MasterCard Purchased Volume fee.
How is it calculated?
Visa’s FANF fee varies depending on how many Customer Present/and Customer Not Present transactions your business processes per month. Customer Present and Customer Not Present Business rates need to be added up separately, since there is a different fee structure for both. However, there are the additional factors that determine how much your business is charged for FANF, which are as follows:
- How many locations your business owns
- Your monthly sales volume
- If your business is considered a “high-volume” merchant category code (MCC) – see exhibit A for a comprehensive list of high-volume MCCs.
Your business will fall into one of three categories: 1) Regular Customer Present Business, 2) High-Volume Customer Present Business, or 3) Customer Not Present Business. Your business is likely in the Customer Present category if it’s not a fast food restaurant, merchant aggregator, unattended terminal, or a business where your customers don’t come into your store to process transactions — and this is a good thing, since rates are usually a lot lower for customer present businesses.
Exceptions to FANF
You don’t have to worry about FANF if your sales are under $200, or if more that 50% of your total Visa sales volume is from Charitable and Social Service Organizations (MC 8398) and/or Religious Organizations (MC 8661).
FANF Rates and Costs
The amount you are charged for FANF for each Customer Present Business location will fall between $2.00 to .15% of your gross monthly sales. The rate you pay will depend on the size of your business and whether your business is considered a high-volume MCC. Use this Visa Fixed Acquirer Network Fee Chart by Wells Fargo to determine the exact amount your business will be charged per month.
If you have a Customer Not Present Business, your rate will fall between $7.00 to $70,000. Obviously, this is a huge range, so check out the FANF Chart to find out what your business will have to pay. Some businesses will have Customer Present, High-Volume Customer Present, and Customer Not Present locations, so it’s important that you refer to the right chart to calculate each location to get an accurate estimate of the total fee you will incur each month.
How to find FANF in your statement
FANF may be referred to as a few different things on your credit card processing statement, including: Visa Fixed Acquirer Network Fee, Fixed Network CNP Fee, High Volume Card Present Fee, Visa Network Fee, FNF Fee, and many variations thereof.
Now that you know the three categories of FANF fees it should be easy to identify the fee on your statement. Note that if you use a “flat rate” credit card processor you may not see the fee on your statement at all, but if you use Visa the FANF fee is still being factored into your total charges — your payment processor is just being less transparent about it. Your best bet is to work with a payment processor like Payment Depot that’s completely open about every charge you incur (and where they come from) on your credit card statement.
Why did your Visa FANF fee go up?
If your FANF fee is higher than it was last month, it could be because you opened another business location, or because you are processing more transactions than you did in the past. If one of your business locations fell under the category of a Customer Not Present Business last month this can also lead to a significantly higher FANF fee from Visa.
Reduce Fees Where Possible
Unfortunately, there’s nothing you or your payment processing company can do to eliminate FANF fees, short of becoming a charitable or church organization (and my guess is it’s a little late for that.)
As we discussed earlier, your payment processor isn’t the one setting the rates and they don’t reap the profits — it’s Visa that does both, so the situation is out of your hands. What you can do is avoid paying additional fees for payment processing by choosing a membership-based pricing model that cuts out the middle man, instead of working with a payment processor that uses “flat rate,” interchange plus or tiered pricing model.
Payment Depot saves retailers an average of $400 dollars a month on payment processing and has a completely transparent pricing system, so you always know exactly what you’re paying for and why you’re paying it––so you can spend less time thinking about your credit card processing statement and more time running a successful business.