There was overwhelming demand for a calculator that would calculate the effective APR on a “Free POS” Loan. So we built the calculator and you can use it here. You will find that it functions much like our third party ordering and delivery calculator.
Below are the calculator fields and what they mean:
Quoted Payments Rate:This is the percent rate your payment provider is quoting you.
Swipe Fee:The amount you pay per transaction, in cents. One dollar per transaction would be 100.
Advertised Cost of POS:This is the dollar amount the POS provider is telling you that you will pay for the POS. This is likely far less than the market cost since you are paying for it in other ways.
Market Cost of POS:This is how much the same POS system would cost if you bought it without any payments contract.
Processing Contract Length:How long, in years, the payments contract is.
Interchange:What the provider is paying for their payments. This should be the payment rate without processor profit.
Merchant Annual Processing Revenues:How much processing revenue a merchant will do on a yearly basis. A $1M a year merchant might only do $800,000 in processing with the rest cash or check.
Merchant Daily Transactions:The number of checks/card swipes done per day.
Annual Payments Profit:How much the payment provider is making in payments profit from the spread of their quoted processing rate and interchange.
Total Cost of Your POS over Contract:Over the course of your processing contract, in years, how much you’re paying for your POS system.
Amount Over, Under Market Cost of POS:Over the term of the payments contract, the difference in the amount paid from the market cost of POS. In other words, would it have been cheaper to purchase the POS outright and if so, how much?
Implied APR:If the amount over, under market cost of POS is positive, the implied APR you’re paying on that money.
