Ignition allows you to pass card processing fees onto your client. If enabled on your Ignition account, a surcharge will be applied to any card payments made by your clients.
Note: This feature is currently only available in the USA and Australia.
Consider if card surcharges are right for you
Before moving ahead, we encourage you to think carefully about whether applying a card surcharge is right for your business.
If clients expect to pay you in the most convenient way for them, applying a surcharge could create a negative customer experience. On the other hand, if all your clients currently pay you from their bank account and you want to offer an additional payment option, surcharging could be a good fit for your business.
If you are interested in using card surcharges, please read this article to learn best practices on how to introduce surcharges to your clients.
Understand what you need to do to be compliant
There are regulations governing the use of card surcharges. Make sure you understand your obligations as a merchant before you begin applying a surcharge for card payments.
As the merchant, it’s your responsibility to comply with the rules that
apply to your business. Rules vary depending on your location.
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How card surcharging works in Ignition
You get to choose your own surcharge rate. Then when payments are made:
Clients pay an extra fee if they choose to pay by card
All the surcharge fees paid by clients are applied to your account as a credit against your Ignition processing fees
You pay the difference between Ignition processing fees and the amount surcharged (if any)
In any given month, if the total surcharges collected surpass the payment processing fees charged by Ignition, we'll credit the surcharges related to each client payment in chronological order until crediting one more surcharge would cause invoice credits to exceed payment processing fees. Uncredited surcharges are carried forward to be applied to future invoices.
Open to see an example of how uncredited surcharges carry forward
Open to see an example of how uncredited surcharges carry forward
For instance, suppose in a particular month your practice incurred $100 in payment fees. On the 6th, there was a $40 surcharge followed by a $80 surcharge on the 14th to offset it. In chronological order, the $40 surcharge would be credited, and the $80 credit would be carried over to the subsequent month.
Passing on card processing fees to clients is a setting that is enabled on your Ignition account as a whole. Card fees can be turned on/off on the client level. Learn more in this section.
Please note: Surcharging is calculated on the total invoice amount, and payment fees are calculated after the surcharge is applied.
Setting up card surcharges in your account
The surcharging feature can only be enabled by Admin users.
To enable the card surcharge feature in your Ignition account in the Settings → Payments tab. Under the Card fees section, enable the Card fees toggle.
Enter a rate to pass on card processing fees to your clients.
The Ignition recommended rates are
AU: 2% (The average card rate is approximately 2.05%. This ensures you recoup almost all card fees)
US: 3% (This keeps you within the 3% surcharge cap that VISA enforces)
Note: The maximum rate you are allowed to pass on will depend on your region.
The maximum rate in 2.5% in AU and 4% in the US.
Read the legalities and confirm that you understand your obligations when using this feature. As the merchant, it’s your responsibility to comply with the rules that apply to your business in your region.
Read the agreement and confirm that once enabled, all clients will be charged processing fees when paying by card. As the merchant, it's your responsibility to inform your clients of your intent to pass on card processing fees.
Click Turn on fees to confirm.
Once confirmed, your surcharge rate will be locked in for all existing and new card payment methods entered by your clients.
Note: If you wish to change the rate, you will need to reach out to our Support Team.
Manage card fees on an individual client level
Once enabled, the surcharging feature is turned on for all new and existing card payments on your Ignition account. You can turn on/off card fees for individual clients.
Disable card processing fees
To disable card fees at the client level from the quick actions menu in the Clients tab, click the ⋮ → select Turn off card processing fees.
Alternatively, within the client's file, click Actions → select Turn off card processing fees. This change will take effect immediately.
Re-enable card processing fees
To re-enable card processing fees for a client, within the client's file, click Actions → select Turn on card processing fees. Confirm that you've informed your client → click Turn on fee.
Your client's experience
Adding a new payment method
You and your clients will see this info-bubble noting the card surcharge when entering payment details.
Included in the accepted agreement PDF
The surcharging rate will be automatically added to the accepted agreement PDF for proposals created using the New Proposal Editor only.
Appears on invoices and payment receipts
The surcharge will appear on Ignition’s invoice emails and payment receipts. However, it will not be pushed down to the connected ledger as a separate line item.
Your experience in Ignition
Visible in the client's file
At the client level, a Fees Apply badge will be listed beside the payment method where surcharges will be added.
Payment collections export
Use the Payment Collections export to get data on what has been surcharged. A new column called Surcharge Amount has been added to the Payment Collections export.
To access this export, navigate to the Payments tab → Collections and click Export in the top right corner.
Updating your card surcharge rate
If you wish to change the rate, you will need to reach out to our Support Team.
Disable surcharging on your account
The surcharging feature can only be disabled by Admin users. If you wish to disable the surcharging feature on your Ignition account as a whole, navigate Settings → Payments tab.
Under the Card fees section, disable the Card fees toggle. Confirm by clicking Turn off fees.
It can take up to 5 minutes for the card processing fees to be disabled on your Ignition account.
FAQ
Is there a maximum rate for surcharges?
Yes, there is a maximum rate: 2.5% in AU and 4% in the US. This is derived from the maximum premium card fees that you can be charged in your country.
Can I apply a surcharge on bank account payments (e.g. ACH, Direct Debit, PAD...etc)?
Bank account or direct debit payments cannot be surcharged.
Can you apply different rates to different cards?
No, but with one exception. For the US only, users can opt to exclude debit cards from surcharging. This is provided as a feature to help users be compliant with local regulations.
What happens if you're under a surcharge rate under the rate for payment fees in a region?
If you collect less from surcharges than the Ignition fees, then you’ll only pay the difference. As an example:
Customer bills clients $10,000 in August and collects $100 in surcharges
Ignition charges payment fees of $250 minus the $100 in surcharges
Customer pays the difference: in this case $150
What happens if a refund is issued for a payment with surcharging fees?
The surcharging fee will be returned to the client if a payment with surcharging fees is refunded.
Do surcharges appear on the invoices generated by Ignition?
How does the surcharge fee rate appear on a client’s invoice?
The surcharge will appear on Ignition’s invoice emails and payment receipts.
However, it will not be pushed down to the connected ledger as a separate line item.
If the customer invoice to my client is $102 and Ignition disburses $100 how does the auto-reconciliation work?
The client invoice created in the ledger will still be $100. This will ensure that auto-reconciliation continues to work as normal.
What happens if I collect more in surcharges than Ignition charges in payment processing fees?
Any leftover credit will be carried forward to the next invoice. This credit cannot be applied to the Ignition subscription component of the invoice.