Dharma Merchant Services Review

Dharma Merchant Services is an affordable credit card processing service for mid- to large-sized businesses. Read this review to find out if it's the right fit for your business.

What is Dharma Merchant Services

Founded in 2007, Dharma Merchant Services is an interchange-plus merchant account provider. Compared to competitors, Dharma's rates are among the lowest.

Dharma lets you process credit card payments:

• In person
  
• Over the phone
  
• Online
  
• Using your mobile device

While they are transparent in their pricing and practices, Dharma Merchant Services isn't right for everyone. Keep reading to learn more.

Dharma Merchant Services Pros

• Transparent interchange plus pricing with no hidden fees. All fees are published on their website.

• No set contract or early termination fees; No monthly minimums.

• Free built-in payment gateway and virtual terminal for all users

• Integration with third-party gateways

• 24/7 customer service with a trained Dharma rep

• Accept payments anywhere with the free Dharma mobile app

Dharma Merchant Services Cons

• Not ideal for new small businesses. You need to show proof of your business entity during the approval process. It's best for companies that process at least $10,000 in credit card sales per month

• $25 monthly fee for all users.

• Strict batch-out deadline of 9 PM Eastern Time to receive funds in 2 business days.

• Dharma charges a $25 fee for each chargeback.

• Does not work with high-risk merchants. Look at these providers instead.

Packages & Fees

All users have a $25 monthly fee. This covers using the service, statement preparation, and customers support. There is no monthly minimum.

Dharma offers different rates based on business type:

Small Business & Retail Rates

• Interchange + 0.15% + $0.08 (Visa, Mastercard, and Discover)
  
• Interchange + 0.25% + $0.08 (Amex)
  
• Interchange + 0.10% + $0.08 (High volume merchants over $100k/mo)

Restaurant & Quick Service Rates

• Interchange + 0.15% + $0.08 (Visa, Mastercard, and Discover)
  
• Interchange + 0.25% + $0.08 (Amex)
  
• Interchange + 0.10% + $0.08 (High volume merchants over $100k/mo)

Virtual & Online Rates

• Interchange + 0.20% + $0.11 (Visa, Mastercard, and Discover)
  
• Interchange + 0.30% + $0.11 (Amex)
  
• Interchange + 0.10% + $0.11 (High volume merchants over $100k/mo)

Non-profits

• Interchange + 0.10% + $0.08 (V/MC/D - storefront)
  
• Interchange + 0.20% + $0.08 (Amex - storefront)
  
• Interchange + 0.10% + $0.11 (V/MC/D - virtual)
  
• Interchange + 0.20% + $0.11 (Amex - virtual)

Here are other fees to be aware of:

• $25 chargeback fee
  
• $49 closure fee
  
• No monthly minimum
  
• No early termination fee
  
• No PCI compliance fee
  
• No batch fees

MX Merchant

Dharma negotiates great rates with the top processors in the industry to save you money on credit card processing costs.

All Dharma Merchant accounts provide access to MX Merchant, which provides:

• Virtual terminal to process online and over-the-phone transactions
  
• Customer database with credit card storage
  
• Mobile processing
  
• Next day funding for card-present transactions
  
• Online reporting

MX Merchant Add-ons
For additional monthly costs, you can select added benefits to your plan. Options include:

• MX Merchant B2B App
  For $20/month, you can collect business-to-business payments at rates much lower than standard interchange rates. The MX Virtual Terminal finds the lowest possible rate for you.

• MX Merchant Insights App
  The MX Merchant Insights App allows you to learn about your customer demographics, connect on social media, and engage with your customers for $10/month.

• MX Account Updater
  For a monthly fee of $25, Dharma will automatically contact up to 150 banks per month to update expiring credit card information. Additional updates cost $0.15 per update.

• ACH Check Processing
  Dharma's integration with ACH.com allows you to accept electronic check payments up to $5,000 a month. Fees include a $25 monthly fee, $0.40 transaction fee, $2 return item fee, and $5 reversal fee.

Equipment Options

In addition to the free MX Merchant payment gateway, Dharma offers a wide range of equipment solutions that can accommodate your business' needs, including:

• Free mobile processing systems through Apple and Android devices

• Free integration with third-party gateways

• Standalone payment terminals such as Verifone Vx520 and First Data FD130

• Station, Mini, and Flex Clover POS Systems

• Poynt Smart Terminal for wireless transactions

How It Compares

Square
Dharma recommends Square to new or small businesses. They do not charge a monthly fee or chargeback fees, but have higher processing fees than Dharma's.

Their pricing model does not use interchange +. Rather, Square charges flat fees depending on the package selected.

The basic plan fees start at 2.5% + $0.10/transaction. Square also provides a free card reader and a powerful POS system, which can be beneficial for new or small businesses.

	DharmaQuickBooksPayment Depot
	Dharma	Square
		SPECIAL OFFER Square Reader: Free Mobile Credit Card Reader - Learn More
	Benefits and Features
Customer Service	Phone, Email, Live Chat Support	Phone, Email, Live Chat Support, Seller Community
Good For	Businesses processing $10,000 or more per month	Mobile & small businesses with average transaction over $100
Equipment	POS (EMV Chip & PIN, Chip & Signature, Contactless, NFC, Magstripe), Mobile Payment Processing, Virtual Terminal	Free magstripe card reader; $49 for contactless + chip reader; Stand, Terminal, and Register available for purchase.
Pricing Model	Interchange-Plus	Flat rate
Swipe Rate	Interchange + 0.15% + $0.08	2.6% + 10¢
Online Rate	Interchange + 0.20% + $0.11	2.9% + 30¢
Monthly Fee	$25 per month	No monthly fees
Keyed-in Transaction Fee	Interchange + 0.20% + $0.11	3.5% + 15¢
Deposit Time	Next day Funding (available for card-present merchants) 2 business days for card-not-present	Payments before 5PM PT / 8 PM ET is available the next business day
Chargeback Fee	$25	None
		Square Reader: Free Mobile Credit Card Reader Square Contactless and Chip Card Reader Square POS: Point of Sale System

PayPal
While PayPal does offer services for in-person merchants, they are best suited for small and mid-sized ecommerce merchants that process transactions on a virtual terminal. They offer a wide range of services for online stores, including invoicing, marketing solutions, business loans, promotional financing, and payment tracking.

PayPal partners with providers such as Shopify, Woo Commerce, GoDaddy, Xero, QuickBooks, and Mailchimp to provide comprehensive packages for ecommerce businesses.

They charge a flat fee of 2.9%/transaction processed in the U.S. + a small fixed fee depending on the currency used. Transactions made outside of the U.S. are charged 4.4%.

Payline Data
Payline Data has higher interchange markup costs than Dharma. However, they offer discounted rates for higher volume transactions and they do not charge any percentage per transaction fees.

Markup costs can range from 0.3%–0.5% depending on the volume of transactions per month. This can potentially reduce costs for businesses that complete over $50,000 in transactions on a monthly basis. They also do not charge a monthly fee for their online shopping platform.

	DharmaSquare
	Dharma	Payline
	Benefits and Features
Customer Service	Phone, Email, Live Chat Support	Phone, Email
Good For	Businesses processing $10,000 or more per month	Businesses processing $5,000 or more per month
Equipment	POS (EMV Chip & PIN, Chip & Signature, Contactless, NFC, Magstripe), Mobile Payment Processing, Virtual Terminal	POS (EMV Chip & PIN, Magstripe, NFC/contactless), Mobile Payment Processing, Subscription Billing, ACH Payments, Online Processing
Pricing Model	Interchange-Plus	Interchange-Plus
Swipe Rate	Interchange + 0.15% + $0.08	Interchange + 0.4% + $0.10
Online Rate	Interchange + 0.20% + $0.11	Interchange + 0.75% + $0.20
Monthly Fee	$25 per month	$10 per month for in-person processing $20 per month for online processing $10 per month for virtual terminal
Keyed-in Transaction Fee	Interchange + 0.20% + $0.11	Interchange + 0.75% + $0.20
Deposit Time	Next day Funding (available for card-present merchants) 2 business days for card-not-present	Next business day
Chargeback Fee	$25	$25

Bottom Line

Dharma Merchant Services offers quality payment processing services for medium to large businesses that process more than $10,000 a month.

They offer a low-cost and efficient option for many business types, including nonprofits, restaurants, ecommerce, and retail stores. Speaking with a Dharma representative can help you determine if it is the right system for you.