Mobile payments service LevelUp is pursuing the path to "Interchange Zero." The company announced Wednesday it plans to cut its credit card processing fees for the merchants and restaurateurs that use the mobile payment app in hopes of getting more small businesses to use its tech.
The Boston company intends to lower its processing fee from 2 percent to 1.95 percent – a seemingly small break, but one that can make a big difference for its 8,000 merchants, many of which are in Boston. The company also has around 1.5 million users.
“This is a permanent drop in our fees. And we plan to continue dropping fees as further processing efficiencies continue to lower our costs,” LevelUp Founder and CEO Seth Priebatsch stated in the release, as reported by BetaBoston.
LevelUp began covering card processing fees for small businesses in mid-2012. In return, merchants ran fee-generating loyalty campaigns. Due to some merchant push back, however, LevelUp’s leadership decided to make the campaigns optional and take a fee of 2 percent per transaction instead.
The company said that it has since been able to lower the collected fees due to finding new ways in which to make the processing more efficient, like grouping transactions together and only charging a user’s credit card once a month, rather than after each purchase.
The company has raised $48.5 million in capital from Highland Capital Partners and Google Ventures, among others.
