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PointeMom

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Reply with quote  #1 
Can anyone shed some light on why certain types of payments must be used for what? Our SO says that competition fees must be paid by cash or check only. I get it. But if my account has say a $600 credit in it from me just making payments online with my debit card, she will not allow that to be used for comp fees. Even though the money has left my bank account and is officially real approved processed money in my dance account - sitting there for days or weeks. Thanks.
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momcrew

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Reply with quote  #2 
There is a fee associated with credit card payments. My guess is they don't want to eat the credit card fee for competition fees since they essentially go into the account and then right back out again. Our studio is the same way. 
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jackilvsmath

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Reply with quote  #3 
Exactly what momcrew said. Our studio charges a 4% fee for credit/debit payments for conventions and competitions. Because they take money and then have to pay it back out. They don’t want to pay the fee from the credit/debit company for money they aren’t keeping.
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tappinmom

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Reply with quote  #4 
Our second studio took extra payments on account all through the year so when comp fees or costumes came due I always had a balance and they would just debit from that for the payment.  The payments were always made using my debit card and it was never an issue.
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123Dance

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Reply with quote  #5 
The studio is charged a fee from the credit/debit card company.  Our studio won't take credit/debit for entry fees because they are just collecting that money to pay to the competition for us.  If they allowed credit/debit payments, then they would actually be charged fees on money they aren't keeping, so it would cost them money for my child to compete!

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5678StarMom

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Reply with quote  #6 
I find all of this interesting, because my sister works as a manager at a large bank and they and other banks charge a similar fee for cash handling. I've brought up these added fees to her because I was wondering and she doesn't get it since they have a cash handling fee that's similar. We don't think they are entirely legal either.
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my2miracles

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Reply with quote  #7 
I totally get the credit care fee but the OP is saying they already processed her credit card and there is $600 on her account in their system waiting to be used for something.  That in my life is a substantial amount of money and I would be demanding it be applied. I think that credit should be applied and then she should pay the remaining balance with cash or check.  It sounds to me like the studio might be cash strapped and I'd be concerned that they already used that $600 on something else.
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PointeMom

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Reply with quote  #8 
Wow. That never even entered my mind. Interesting thought. And yes when I had extra money I would always pay money online to my account just to have it in there. They never gave me any issues about using it for comps until last year. Weird indeed.
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Angel2228

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Reply with quote  #9 
I'm not sure if your system works different, but when I give money to the studio, whether it's credit card or debit card, I pay using the same hand held machine and they deposit that money into the studios one account. (I could e transfer or pay cash as well) Either way, they deposit into their studios bank account. They pay for the admission or costumes with their credit card, and then they pay the bill or write a cheque from that account. There's a service fee they pay the have their device and take transactions, just as the companies they are making the payment have to pay. So they don't pay the fee twice.
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my2miracles

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Reply with quote  #10 
Quote:
Originally Posted by Angel2228
I'm not sure if your system works different, but when I give money to the studio, whether it's credit card or debit card, I pay using the same hand held machine and they deposit that money into the studios one account. (I could e transfer or pay cash as well) Either way, they deposit into their studios bank account. They pay for the admission or costumes with their credit card, and then they pay the bill or write a cheque from that account. There's a service fee they pay the have their device and take transactions, just as the companies they are making the payment have to pay. So they don't pay the fee twice.


What everyone is talking about is when a business takes credit cards as a payment source, the business has to pay a fee to the credit card company to process the payment.  So you pay $200 to the studio using a credit card and the studio pays $0.70 to the credit card company.  This is standard across all businesses in the US.  Not sure what other countries do.

When the studio pays the competition with a credit card, the competition pays the credit card processing fee.
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123Dance

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Reply with quote  #11 
Quote:
Originally Posted by my2miracles
I totally get the credit care fee but the OP is saying they already processed her credit card and there is $600 on her account in their system waiting to be used for something.  That in my life is a substantial amount of money and I would be demanding it be applied. I think that credit should be applied and then she should pay the remaining balance with cash or check.  It sounds to me like the studio might be cash strapped and I'd be concerned that they already used that $600 on something else.


No, I don't think that's the case at all.  She put the money on her account using a credit or debit card, which means a 4% fee (approximately) for the studio.  So, of that $600, the studio only receives approximately $576.  So, if she owes $600 in comp fees, and the studio has only collected $576 (net, after the credit card fee) but has to pay the competition $600, then they're losing money!  

We have always had rules about method of payment, depending on what the money was for.  If it was a service provided by the studio (choreo, classes, etc), then we could pay using any method of our choosing, but if it was money they were collecting to pass off to someone else (costumes, comp fees, exam fees, etc.), then it had to be cash.  Otherwise the studio would be paying out of pocket because of the fees deducted by the credit card company.

 
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PointeMom

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Reply with quote  #12 
Ok. Now it makes sense. Thank you for this explanation. I never got this answer from any one when I asked the studio.
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5678StarMom

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Reply with quote  #13 
123Dance, that's a great way to explain it. I wonder why our studio allows CC payments for competition when it doesn't make much financial sense.
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123Dance

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Reply with quote  #14 
Quote:
Originally Posted by 5678StarMom
123Dance, that's a great way to explain it. I wonder why our studio allows CC payments for competition when it doesn't make much financial sense.


It is possible that your studio marks up comp fees.  Some studios add a bit to each entry cost to cover these types of fees (plus the endless hours it takes to input the information for each competition).
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BalletMom62567

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Reply with quote  #15 
Our studio is the same, but we pay the fee if we use a credit card to pay tuition. They don't absorb the fee. So, I don't think the fee can be the reason. I have wondered about it too.
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