How to Reduce Payment Processing Costs for Firearm Businesses (2025 Best Guide)

How to Reduce Payment Processing Costs for Firearm Businesses

By alphacardprocess November 25, 2025

Reducing payment processing costs for firearm businesses is one of the fastest ways to improve margins without selling a single extra gun, accessory, or box of ammo. Because firearm businesses are treated as “high risk” by many banks and processors, they often pay higher fees, face more reserves, and deal with extra compliance requirements.

That doesn’t mean you’re stuck with excessive payment processing costs for firearm businesses forever. With the right provider, pricing model, and internal processes, you can significantly cut costs while staying fully compliant with U.S. laws and card-brand rules.

In the United States, firearm retailers, FFLs, online gun stores, and tactical e-commerce brands operate in a complicated payments environment. Networks like Visa and Mastercard rely on Merchant Category Codes (MCCs) to classify merchants.

A specific code, MCC 5723, has now been created for “guns and ammunition” dealers and is being implemented in states like California, Colorado, and New York, while other states actively prohibit its use.

Because of this patchwork of rules, firearm businesses must proactively manage compliance, choose gun-friendly processors, and fully understand their statements. When you do, you can reduce payment processing costs for firearm businesses by eliminating junk fees, improving transaction quality, and using smart alternatives like ACH or compliant dual pricing.

This guide walks through how fees work, why firearm businesses often pay more, and the specific strategies that actually move the needle on your effective rate.

It’s written for U.S. firearm retailers, ranges, manufacturers with direct-to-consumer sales, and FFL e-commerce shops that want practical, up-to-date ways to lower their payment processing costs.

Overview of Payment Processing Costs for Firearm Businesses Today

Payment processing costs for firearm businesses are made up of several layers: interchange fees set by the card brands, assessments charged by the networks, and markups added by your processor or merchant services provider.

As a firearm business in the U.S., you’re also affected by your risk profile, your MCC, chargeback ratios, and how your transactions are presented to the networks.

Most firearm businesses see their fees expressed as:

A percentage of each transaction (for example 2.75%)
Plus a per-transaction fee (for example $0.15)
Plus various monthly and annual fees

Interchange is normally the largest piece and is non-negotiable because it’s set by the card brands. The part you can control is the markup your processor adds, as well as the way your transactions qualify for specific interchange categories.

High-risk firearm businesses sometimes get pushed into flat-rate pricing that hides the true cost of interchange and overcharges on every sale.

At the same time, the introduction and phased implementation of MCC 5723 for guns and ammunition adds another layer. The code is required in some states and banned in others, which means processors have to configure accounts very carefully.

This can increase operational costs for providers, and they may try to pass those costs down to firearm businesses through higher payment processing costs.

Understanding these moving parts is the first step to reducing payment processing costs for firearm businesses. When you know what’s truly negotiable, what’s driven by risk, and what’s based on card-brand rules, you can build a smarter strategy instead of just accepting whatever rate appears on your proposal.

Key Components of Payment Processing Costs for Firearm Businesses

Every time you accept a credit or debit card, three main parties touch the transaction: the issuing bank, the card network (like Visa or Mastercard), and your acquiring bank or processor. Each party gets paid, and that’s where the main components of payment processing costs for firearm businesses come from.

1. Interchange fees

Interchange is paid to the cardholder’s issuing bank and is set by the card brands. It varies based on card type (debit vs rewards credit), transaction type (card-present vs online), and data quality.

For firearm businesses, interchange can be higher when transactions are keyed, when address verification isn’t used, or when extra risk indicators are triggered. You cannot negotiate interchange directly, but you can optimize how your transactions qualify to reduce your effective interchange cost.

2. Card-brand assessments and network fees

Networks charge small assessment fees on every transaction to fund their systems and risk programs. These fees are also non-negotiable and are the same for firearm businesses as for other merchants, but some processors “pad” or relabel them on your statement.

Carefully reviewing these line items is essential when you are trying to reduce payment processing costs for firearm businesses.

3. Processor markup

This is the part that varies the most. It includes:

Per-transaction markups
Percentage markups above interchange
Monthly account fees
PCI compliance fees
Gateway or POS fees
Annual fees, statement fees, and junk fees

High-risk firearm merchants are often quoted inflated markups “because of the industry.” In reality, many of these fees are negotiable, especially if your chargebacks are low and your monthly volume is stable.

By understanding and separating interchange, assessments, and markup, you gain leverage to push down your payment processing costs for firearm businesses.

How Firearms-Specific Rules and MCC 5723 Affect Your Costs

The new firearms Merchant Category Code, MCC 5723, was approved by the International Organization for Standardization to classify gun and ammunition retailers.

For years, firearm businesses were commonly grouped under broader MCCs like sporting goods or general merchandise. That’s changing in 2024–2025 as more U.S. states pass laws either requiring or banning the use of the gun-store-specific code.

California, Colorado, and New York now require payment networks to implement and use MCC 5723 for firearm and ammunition merchants, with deadlines for acquirers to assign the code by mid-2025.

Other states, including Florida, Texas, New Hampshire, and several more, have passed laws limiting or prohibiting the use of the firearms MCC.

For firearm businesses, this environment impacts payment processing costs in several ways:

Compliance complexity – Processors must configure accounts differently by state, which raises their internal costs. Some pass that cost on to firearm businesses through higher markups or custom “high-risk” programs.
Risk perception – MCC 5723 can make your category more visible to compliance teams and banks, which may increase underwriting scrutiny. Clean books, clear policies, and stable volume help offset this and support better pricing.
Data visibility – While MCC does not reveal item-level data, some financial institutions may pay closer attention to total volumes at firearm merchants, especially in states with specific oversight expectations.

The key takeaway is that the MCC does not automatically increase interchange, but it can indirectly influence pricing decisions by processors and sponsoring banks.

By working with a gun-friendly payment partner that understands MCC 5723 and multi-state compliance, you can reduce payment processing costs for firearm businesses instead of paying for your provider’s confusion.

Selecting a Gun-Friendly Payment Processor and Pricing Model

The single biggest lever to reduce payment processing costs for firearm businesses is choosing the right processor. Many mainstream fintechs and “instant signup” payment apps either prohibit firearms entirely or impose punitive pricing.

If you are classified as “high risk” without context or are working with a provider that doesn’t understand FFL rules, you will almost always overpay.

A gun-friendly payment processor is one that explicitly supports firearm sales, understands ATF and state-level requirements, and has established underwriting guidelines for FFL dealers and tactical e-commerce.

They won’t ask you to hide your business type under a misleading MCC. Instead, they’ll help you stay transparent and compliant while still working to control payment processing costs for firearm businesses.

On top of being firearm-friendly, the processor should offer transparent pricing, ideally interchange-plus or true membership pricing, instead of opaque tiered plans.

They should also have experience with MCC 5723 deployment in states that require it, and with alternative options for states that prohibit it. When the provider is comfortable with your industry, they are less likely to impose excessive reserves, rolling holds, or high “risk surcharges” that inflate your costs.

Evaluating Gun-Friendly Merchant Accounts vs Mainstream Providers

A common mistake firearm businesses make is trying to use a generic payment solution built for coffee shops or online creators. Many of these platforms have terms that explicitly ban gun sales, ammunition, or tactical gear, even if enforcement is inconsistent.

When your business is discovered, you risk sudden account termination, frozen funds, and an emergency scramble to restore card acceptance.

Gun-friendly merchant accounts, by contrast, are built to support firearm businesses from day one. They:

Ask detailed underwriting questions about your FFL, products, and sales channels
Understand transfer processes, NICS checks, and how you ship to other FFLs
Have clear policies regarding accessories, optics, and related high-risk items
Know how to classify your business correctly, whether under MCC 5723 in states that require it or under appropriate alternative codes in states that prohibit it

From a cost perspective, firearm-friendly processors may initially look more expensive than consumer-grade payment apps. However, once you factor in realistic chargeback support, lower risk of shutdown, and the ability to negotiate rates, they’re often cheaper over the long term.

When evaluating providers to reduce payment processing costs for firearm businesses, look for:

Clear industry acceptance – They openly advertise support for FFLs and firearms, not just “outdoor” or “sporting goods.”
Transparent rate structure – Interchange-plus with a fixed markup, not arbitrary “qualified / mid-qualified / non-qualified” tiers.
No surprise reserves – If a reserve is required, it should be clearly defined with a specific review timeline.
U.S.-based support familiar with firearms – So they can actually help with MCC, compliance, and chargebacks.

Choosing a processor that welcomes firearm businesses instead of merely tolerating them is crucial if you truly want to lower payment processing costs for firearm businesses in a sustainable way.

Comparing Interchange-Plus, Membership, and Flat-Rate Pricing

Pricing model choice has a huge impact on payment processing costs for firearm businesses. Even if two processors advertise similar headline rates, the structure underneath can either save or cost you thousands of dollars per year.

Flat-rate pricing

Flat-rate models (for example 2.9% + $0.30 for every transaction) are simple but often expensive for firearm businesses. They blend interchange, assessments, and markup into one rate.

Because high-reward credit cards and card-not-present transactions cost more at the interchange level, the processor has to set the flat rate high enough to protect their margin. If you run a mix of regulated debit and standard credit cards, you’ll overpay on many transactions.

Interchange-plus pricing

This model passes through actual interchange and assessments, then adds a fixed markup (for example interchange + 0.30% + $0.10). It is typically the most transparent and fair way to price payment processing costs for firearm businesses.

You can see exactly what the brands are charging and what your processor is earning. This makes it easier to negotiate the markup without arguing over costs you can’t change.

Membership or subscription pricing

Some processors charge a monthly membership fee and then add very small per-transaction markups over interchange. This can work well for higher-volume firearm businesses because the fixed fee is spread over more transactions.

Make sure the provider is truly passing through interchange and not layering hidden margins into “network fees.”

Tiered pricing

Tiered models group transactions into qualified, mid-qualified, and non-qualified buckets with different rates.

They are almost always a bad deal for firearm businesses because so many of your transactions will fall into the higher, non-qualified tiers, especially card-not-present or rewards cards. Tiered plans also make it nearly impossible to see what you’re actually paying above interchange.

To reduce payment processing costs for firearm businesses, push for interchange-plus or a transparent membership model, and avoid tiered plans whenever possible.

Once you are on a transparent model, you can track your effective rate (total fees / total processed volume) and negotiate intelligently when your volume grows or your chargebacks fall.

Optimizing In-Store (Card-Present) Payments to Lower Fees

Card-present transactions almost always cost less than keyed or online payments because they are considered lower risk by the brands. If you run a brick-and-mortar gun shop, range, or tactical store, optimizing in-person payments is one of the easiest ways to reduce payment processing costs for firearm businesses.

The foundation is using modern EMV and NFC-capable terminals or a robust point-of-sale system. When a chip card is dipped or a contactless wallet is tapped, the transaction includes dynamic data that protects against counterfeit fraud.

That can help your transactions qualify for better interchange categories and reduce liability for certain fraud chargebacks.

For firearm businesses, it’s especially important that every card-present sale goes through the terminal in the correct way. Avoid keying card numbers unless absolutely necessary. Keyed transactions are often surcharged at higher rates and carry more risk flags.

Train staff to re-insert or tap cards properly, and to recognize when a card might be damaged or tampered with.

Beyond hardware, your store policies directly affect payment processing costs for firearm businesses. For example, clear return and layaway policies, documented special-order terms, and signed receipts can all help you win disputes and keep chargeback ratios low.

The lower your chargebacks, the more comfortable processors are with your account, and the better your chances of negotiating rate reductions over time.

EMV, NFC, and POS Best Practices for Firearm Retailers

Implementing EMV and NFC correctly is not just a fraud issue; it’s a cost issue. When firearm retailers use chip and contactless technology, they send stronger data to the networks, which supports better interchange qualification.

Over thousands of transactions, this can make a real difference in payment processing costs for firearm businesses.

Start with these best practices:

Use certified EMV terminals: Make sure your terminals are EMV-certified and up to date. Outdated hardware can force more fallbacks to magstripe or key entry, which are more expensive and riskier.
Enable contactless (NFC) payments: Apple Pay, Google Pay, and contactless cards tokenize card data and support secure, fast transactions. Many firearm customers appreciate the privacy and speed of tap-to-pay, and NFC transactions usually qualify similarly to dipped EMV transactions from a cost standpoint.
Integrate POS with inventory and compliance workflows: A gun-friendly POS that tracks serial numbers, ATF forms, and bound book entries can reduce manual errors and speed up checkout. When your staff isn’t juggling multiple systems, they’re less likely to make mistakes that lead to chargebacks or mismatched transaction records.
Avoid manual key entry whenever possible: Only key a card if the chip and magstripe truly fail. Even then, consider asking for another card or offering an alternative payment method like ACH. Keyed transactions can increase payment processing costs for firearm businesses by triggering higher interchange tiers and additional risk reviews.
Keep terminals locked down and tamper-evident: Periodically inspect devices for skimmers or tampering. A security incident not only causes chargebacks and disputes, it can also result in non-compliance fees and higher long-term costs.

By treating your POS and terminals as strategic tools rather than simple credit card machines, you can protect your margins and consistently reduce payment processing costs for firearm businesses operating in physical locations.

Reducing Risk and Chargebacks at the Counter

Chargebacks are one of the biggest hidden drivers of payment processing costs for firearm businesses. Even if your headline rate looks competitive, frequent disputes can lead to extra fees, higher effective rates, and sometimes even account closure.

At the counter, you can cut risk and chargebacks by:

Verifying identity carefully – Always check a government-issued ID for large purchases, especially when selling firearms and serialized items. Make sure the name matches the card and the ATF paperwork.
Capturing signatures and clear documentation – Even though signatures are no longer required by card brands for most transactions, they can still be useful evidence in disputes. Combine signatures with printed or digital receipts that clearly describe the firearm, accessories, and any special conditions.
Using clear refund and return policies – Post your policies at the counter and include them on receipts. For example, “All firearm sales are final” or “Returns subject to restocking fee within X days for unused accessories.” When customers understand the rules upfront, they are less likely to dispute charges.
Documenting background check outcomes and transfers – Maintain organized records for NICS checks, delayed or denied transactions, and FFL-to-FFL transfers. These documents can help prove that you followed legal procedures.

From a processor’s perspective, low chargeback ratios signal that your firearm business is well-managed and compliant. That makes it easier to request lower markups, better terms, or a review of reserves if you’re trying to reduce payment processing costs for firearm businesses.

Many acquirers will re-underwrite accounts annually or when volume grows; showing a strong dispute record is a powerful bargaining chip.

Reducing Online and Mail-Order Payment Costs for FFL eCommerce

More FFLs and firearm brands are selling online through e-commerce sites, auction platforms, and marketplace integrations. While online sales expand your reach, they also tend to cost more because card-not-present transactions carry higher fraud risk. That’s why card brands price online interchange higher and why many processors add extra risk surcharges for e-commerce firearm businesses.

To reduce payment processing costs for firearm businesses that sell online, you need to focus on two main areas:

Gateway configuration and data quality – Sending complete AVS (Address Verification Service) and CVV data, using 3D Secure where appropriate, and capturing accurate customer information can improve interchange qualification and lower fraud.
Website policies and checkout design – Transparent policies, clear descriptors, and friction-appropriate security steps reduce disputes and abandoned carts.

Because online firearm transactions usually involve shipping to another FFL, you also need to collect and store the receiving dealer’s information carefully. Integrating your checkout with FFL databases or workflows can reduce errors, minimize customer confusion, and support your case if a dispute arises later.

The cleaner your process, the easier it is to maintain low chargeback rates and control payment processing costs for firearm businesses that operate nationally.

Gateway Configuration, AVS, and 3D Secure for Online Gun Sales

Your payment gateway is the brain of your online processing setup. The policies and settings inside that gateway have a direct effect on payment processing costs for firearm businesses because they influence risk, fraud, and interchange qualification.

Here are practical configuration steps for FFL e-commerce and tactical stores:

Require AVS and CVV on all card-not-present orders: AVS compares the billing address entered by the customer with the address on file at the issuing bank. CVV verifies the security code on the card. Enforcing AVS and CVV reduces fraud and can help your transactions qualify for better interchange categories.
Use 3D Secure (e.g., EMV 3-D Secure) where it makes sense: 3D Secure adds a step where the cardholder may authenticate with their bank via one-time codes or other methods. It can shift certain fraud liabilities back to the issuer and reduce chargebacks.

For high-ticket or high-risk online firearm orders, selectively using 3D Secure can be a net win for both risk and cost.
Set sensible velocity and fraud rules
Configure rules to flag:
- Multiple orders on the same card in a short time
- Large dollar amounts from new customers
- Mismatched country data
- Orders that ship to freight forwarders or suspicious addresses
  Manual review for flagged orders may take time, but it can prevent costly chargebacks that indirectly drive up payment processing costs for firearm businesses.
Ensure your descriptor is recognizable: Your gateway and processor should use a clear billing descriptor, such as your shop name and city. Many disputes happen simply because customers do not recognize the charge.
Maintain an IP and device-level audit trail: Some fraud tools log IP addresses, device fingerprints, and behavioral data. This kind of evidence can help you fight “friendly fraud” chargebacks where customers receive a firearm or accessory but later claim they never ordered it.

Proper gateway configuration is a one-time investment that keeps paying off. By tightening fraud controls and improving data quality, you reduce refunds, chargebacks, and expensive risk surcharges, which all contribute to higher payment processing costs for firearm businesses online.

Balancing Convenience, Security, and Cost for Digital Payments

Online customers want speed and convenience, but for firearm businesses, security and compliance must come first. The challenge is to design your checkout experience so that it protects you and your customers without killing conversions or unnecessarily inflating payment processing costs for firearm businesses.

A smart approach is to categorize your orders by risk level and adapt your security measures accordingly:

Low-risk orders – Returning customers, small accessory purchases, low total dollar amounts. You can still require AVS and CVV but may skip extra manual review.
Medium-risk orders – New customers with larger carts, orders going to FFLs in certain jurisdictions, or multiple high-dollar accessories. Consider extra checks, such as confirming FFL details via phone or email.
High-risk orders – Very high ticket orders, unusual international shipping, mismatched billing/shipping data, or customers who push back on verification. These should trigger manual review, 3D Secure, or even a request for a different payment method like ACH.

At the same time, provide clear communication:

Display your firearm shipping policies prominently.
Explain that firearms must ship to FFLs and that additional verification may be required.
Provide estimated processing times so customers don’t panic and file disputes.

By setting expectations and tailoring your security measures to risk level, you protect your business without overwhelming legitimate customers. Over time, fewer disputes and smoother operations mean lower effective payment processing costs for firearm businesses that rely on digital channels.

Advanced Strategies to Reduce Payment Processing Costs

Once you’ve handled the basics—gun-friendly provider, solid hardware, and good gateway settings—you can look at more advanced strategies to reduce payment processing costs for firearm businesses. These strategies often involve negotiating with your processor, restructuring how you present pricing to customers, and introducing alternative payment methods with lower fees.

High-volume firearm businesses, multi-location ranges, and manufacturers with dealer networks have the most leverage here, but even smaller gun shops can benefit. The goal is to align your processing setup with how you actually do business, rather than accepting a generic “high-risk” package.

Key levers include negotiating your markup, trimming junk fees, exploring surcharge or dual-pricing programs that are compliant with state and card-brand rules, and offering lower-cost rails like ACH for large transactions.

Each of these can shave basis points off your effective rate and directly reduce payment processing costs for firearm businesses.

Negotiating Rates, Bundled Fees, and Contract Terms

Negotiation is not just for big box stores. If your firearm business has stable processing volume, low chargebacks, and clean compliance history, you have leverage. Most processors would rather lower your rate slightly than lose a well-run firearm business to a competitor.

To negotiate effectively:

Know your current effective rate: Divide your total monthly fees by your total processed volume. This gives you a single percentage that reflects all costs. Use this number when comparing offers and asking for reductions in payment processing costs for firearm businesses.
Request an interchange-plus proposal: If you’re on tiered or flat-rate pricing, ask your processor for an interchange-plus quote, or get competing quotes from other firearm-friendly providers. When you have multiple offers, you can ask your incumbent provider to match or beat them.
Target specific fees: Instead of only asking for “a better rate,” be specific:
- Reduce the percentage markup above interchange.
- Lower or remove PCI compliance and statement fees.
- Waive batch fees, annual fees, or “regulatory” fees that are really just markups.
Review contract length and termination clauses: Multi-year contracts with harsh early termination fees can trap you in an expensive setup. When possible, negotiate shorter terms or caps on termination fees so you can switch if payment processing costs for firearm businesses rise again in the future.
Ask for periodic reviews: As your volume grows, your risk profile often improves. Ask for a scheduled rate review after 6–12 months of clean processing. Processors are much more open to reducing margins when they see consistent, profitable activity.

A calm, data-driven conversation, backed by accurate statements and competing quotes, can lead to substantial savings on payment processing costs for firearm businesses—sometimes more than any single hardware or software change.

Surcharging, Cash Discount, and Dual Pricing Compliance for Firearm Businesses

Programs that shift some or all card fees to customers can significantly reduce payment processing costs for firearm businesses, but they must be implemented carefully and in compliance with federal, state, and card-brand rules. Misconfigured programs can lead to fines, disputes, or even account termination.

Surcharging

A surcharge is an extra fee added when a customer pays with a credit card (not debit), intended to cover processing costs. In the U.S., surcharging is regulated at both the state and card-brand levels.

Some states restrict or prohibit surcharges, while card brands set caps (for example, up to 3%) and transparency requirements. Card-brand rules typically require clear signage and line-item disclosure.

Cash discounting

Cash discount programs offer a lower price to customers who pay with cash (or sometimes debit), while the posted price includes the “standard” card rate.

This approach is legal in most states but still subject to truth-in-advertising and card-brand rules. True cash discounting is different from surcharging; it’s about offering a discount rather than adding a fee.

Dual pricing

Dual pricing shows both cash and card prices side by side. For example, a firearm might be $950 cash or $979.99 by card. This method can be very transparent and customer-friendly when implemented correctly.

It allows firearm businesses to recoup some of the processing cost while giving customers a clear choice.

For firearm businesses, especially in states with higher regulatory scrutiny, it’s crucial to work with a processor that offers compliant programs and understands local laws. Incorrect labeling or failing to respect debit-card rules can create legal and brand-damage risk.

When these programs are done right and clearly communicated, they can meaningfully reduce payment processing costs for firearm businesses, especially on high-ticket items like firearms and optics.

However, you should also consider customer expectations and competitive positioning; in some markets, absorbing fees and focusing on volume may be more strategic.

Operational and Back-Office Steps That Protect Your Margins

Even with the best processor and pricing model, sloppy back-office practices can quietly inflate payment processing costs for firearm businesses. Small errors—like failing to batch out on time, mis-keying transaction amounts, or ignoring PCI compliance notices—often result in avoidable fees and disputes.

Operational discipline matters. Reconciling daily batches with your POS and bank, staying on top of PCI questionnaires, and reviewing statements every month can prevent small problems from accumulating into significant cost.

Because firearm businesses already face extra scrutiny, clean records and clear documentation also help maintain good standing with banks and processors.

Think of your payments operation the way you think about ATF compliance or inventory management. When everything is documented, consistent, and regularly audited, you reduce surprises, protect your license, and keep payment processing costs for firearm businesses under control.

Auditing Statements, Tracking KPIs, and Avoiding Junk Fees

Most merchants glance at their monthly statement just long enough to see the total fees. For firearm businesses, that’s not enough. To truly reduce payment processing costs for firearm businesses, you need a simple but consistent audit process.

Key steps include:

Check total volume and fees each month: Confirm that total processed volume matches what your POS and bank deposits show. Then calculate your effective rate (total fees ÷ total volume). Track this over time to spot trends.
Look for new or increasing fees: Watch for line items that suddenly appear or grow:
- “Regulatory compliance” or “network optimization” fees
- “Monthly minimum” charges
- “Non-EMV” or “non-PCI” fees
  If the description is vague, ask your provider to explain and justify it.
Monitor chargeback ratios and reason codes: High or rising chargebacks not only result in direct loss but can trigger fines or higher pricing. Break down disputes by reason (fraud, not as described, etc.) and adjust store policies, training, or website copy to address root causes.
Track key metrics: Consider tracking:
- Effective rate by location or channel (in-store vs online)
- Percentage of keyed transactions
- Percentage of card-not-present orders
- Chargebacks per 1,000 transactions
Review at least quarterly with your processor: Schedule a quarterly or semi-annual review with your account rep to discuss trends, growth, and opportunities to adjust pricing.

By treating your merchant statements as a financial tool instead of a generic bill, you’ll quickly spot opportunities to reduce payment processing costs for firearm businesses, often by simply asking the right questions and pushing back on unjustified charges.

Training Staff and Aligning Policies With Your Payment Strategy

Your front-line staff and managers have more influence over payment processing costs for firearm businesses than many owners realize. Every time an employee keys a card instead of dipping it, skips ID checks, or makes exceptions to return policies, they increase the chance of chargebacks and extra fees.

Practical training topics for firearm businesses include:

Correct use of terminals – How to handle chip errors, when to re-try, and when to request another payment method.
ID verification and documentation – Especially for firearm sales and high-dollar accessory purchases.
Refund and exchange procedures – Ensuring that refunds are processed to the original card and logged in your POS and accounting system.
Customer communication – Explaining policies calmly and clearly to reduce misunderstandings that lead to disputes.

Align your written store policies and website terms with your payment strategy. If you use dual pricing or cash discounts, train staff to explain the program in a straightforward, non-confrontational way. If you limit returns on certain serialized items, make sure that’s spelled out in writing and on receipts.

When the entire team understands that their everyday decisions affect payment processing costs for firearm businesses, you’re far more likely to maintain low chargeback ratios, avoid compliance issues, and qualify for the best available pricing over time.

FAQs

Q.1: What is a good effective rate for firearm businesses in the U.S.?

Answer: There is no single “right” number, but for many brick-and-mortar firearm businesses using interchange-plus pricing, a competitive effective rate often falls somewhere in the mid-2% range to low-3% range, depending on card mix, ticket size, and how much card-not-present activity you have.

Online-only or heavily e-commerce-driven firearm businesses may see higher effective rates due to risk and interchange.

To evaluate your own situation, calculate your effective rate by dividing total monthly fees by total volume processed. Then compare that figure with offers from other gun-friendly processors that use transparent interchange-plus pricing.

The goal is not to hit an arbitrary benchmark but to identify whether your current provider is charging an excessive markup.

If you see an effective rate significantly higher than similar firearm businesses with comparable risk profiles, it’s a clear signal that you can likely reduce payment processing costs for firearm businesses by renegotiating or switching providers.

Remember that a slightly higher rate with better chargeback support and fewer surprises can sometimes be cheaper over time than a lower advertised rate with poor service, hidden fees, or sudden account holds. Look at total cost and business continuity, not just the headline percentage.

Q.2: Does MCC 5723 make my fees higher automatically?

Answer: MCC 5723 is the merchant category code created for gun and ammunition retailers. Its primary purpose is to classify your business type for card networks and financial institutions.

The code itself does not automatically increase interchange fees, which are set by the card brands for broad categories like retail, card-not-present, and so on.

However, MCC 5723 can indirectly influence payment processing costs for firearm businesses. In states like California, Colorado, and New York, where use of the firearms MCC is now required or being implemented, processors may invest more in compliance, monitoring, and reporting.

Some providers may respond by increasing markups for firearm businesses in those states, especially if they see the industry as higher risk.

In states that prohibit or restrict the firearms MCC, processors face a different set of challenges. They must balance state law with network expectations, which can also affect their costs and risk posture.

The practical takeaway is that MCC 5723 changes the classification and visibility of firearm merchants, not the underlying interchange tables.

By working with a gun-savvy processor that understands these laws and treats your business fairly, you can navigate MCC 5723 while still actively working to reduce payment processing costs for firearm businesses.

Q.3: How can a small gun shop negotiate better credit card rates?

Answer: Small gun shops often assume they lack leverage, but that’s not true. You can negotiate better rates if you:

Present clean processing history – Show low chargebacks, stable volume, and consistent batching. This reduces perceived risk.
Provide multiple quotes – Get interchange-plus proposals from two or three gun-friendly processors. Sharing these with your existing provider can motivate them to match or beat the offers.
Highlight growth potential – If your firearm business is growing or opening additional locations, emphasize projected volume. Processors value growth and may reduce markups to secure long-term relationships.
Ask for specific concessions – For example, ask for a lower markup on card-present transactions, waived PCI fees, or reduced monthly minimums.

Even if you only shave off a few tenths of a percent, the impact on payment processing costs for firearm businesses can be substantial over a year. Always revisit your pricing annually as your sales mix and risk profile evolve.

Q.4: Are ACH and eCheck realistic options for firearm businesses?

Answer: Yes. ACH, eCheck, and other bank-to-bank payment methods can be excellent tools to reduce payment processing costs for firearm businesses, especially for high-ticket items like firearms, safes, optics, and bulk ammunition.

ACH fees are typically flat or very low compared to percentage-based card fees. For example, a flat few dollars per ACH transaction can be dramatically cheaper than paying 2–3% on a $2,000 rifle.

Some firearm-friendly processors and gateways allow you to offer ACH as a checkout option or in-store via secure bank links or invoicing.

However, ACH has its own considerations:

Settlement can take longer than card payments.
Dispute windows and processes differ from card chargebacks.
You’ll need clear policies around when orders ship relative to ACH clearance.

When implemented with clear communication and reasonable processing timelines, ACH can effectively lower payment processing costs for firearm businesses without harming customer experience. Many customers are comfortable paying via bank transfer when they understand the savings and trust your brand.

Q.5: Is cash discounting or dual pricing legal for firearm businesses in every state?

Answer: Cash discounting and dual pricing programs are generally legal in most U.S. states, but details matter. You must comply with state consumer-protection laws, federal disclosure rules, and card-brand requirements.

Some states have specific statutes governing how surcharges or price differentials can be presented. Card brands also require that any fees or discounts related to payment methods are disclosed clearly at the point of entry, at the point of sale, and on the receipt.

For firearm businesses, where regulators and advocacy groups pay close attention, it is especially important to implement these programs in a fully compliant way.

Work only with processors that specialize in compliant surcharge, cash-discount, or dual-pricing setups and that can provide sample signage, receipt configurations, and written guidance.

When done correctly, these programs can meaningfully reduce payment processing costs for firearm businesses by shifting some expenses to customers who choose more expensive payment methods.

When done poorly, they can invite complaints, disputes, or even enforcement actions. Always consult with your processor and, if necessary, legal counsel when rolling out such programs across multiple states.

Conclusion

Reducing payment processing costs for firearm businesses is not a one-time project. It’s an ongoing process that weaves through provider selection, pricing models, hardware, software, staff training, and compliance.

Firearm retailers, FFLs, and tactical e-commerce brands operate under more scrutiny than most merchants, especially with the rollout of MCC 5723 in some states and restrictions in others. That makes it even more important to be intentional about how you handle payments.

By understanding the components of your fees, choosing a gun-friendly processor with transparent interchange-plus or membership pricing, and optimizing both in-store and online transaction flows, you can significantly cut costs.

Layer on top of that a disciplined approach to statement reviews, chargeback prevention, alternative payment methods like ACH, and—where appropriate—compliant dual pricing or cash discounting, and you have a robust strategy to lower your effective rate.

Most importantly, treat payment processing as a core operational function, not an afterthought. Just as you invest time in ATF compliance, safety training, and inventory management, invest time in understanding and managing your payment environment.

The rewards are real: lower processing bills, more predictable cash flow, and stronger long-term profitability for firearm businesses serving law-abiding customers across the United States.