Dharma Merchant Services: Should You Use Them?

Dharma Merchant Services: Should You Use Them?

Dharma Merchant Services is an excellent credit card processor for mid-to-large sized businesses. They have transparent and competitive pricing that makes them an appealing choice for most companies. If you are just starting to process card payments and do less than $10k per month in sales, we recommend going with another processor, like Square.

Review: Our Thoughts On Dharma Merchant Services

Dharma Merchant Services is one of the best credit card processors we’ve come across. They go above and beyond in helping businesses understand the costs involved in processing payments. They aren’t the best deal for small businesses that are just starting out, and the company advises as much on their website. Dharma suggests small companies turn to their competitors like Square or PayPal. According to Dharma’s website, any firms processing less than $10,000 per month should seek those alternatives.

Good For…Bad For…
Companies looking for transparencyFirms processing less than $10,000 per month
Mid-to-large businesses

Dharma uses interchange plus pricing, which is one of the most clear-cut fee structures in the processing industry. You will pay a markup between 0.20% and 0.25% for offline transactions, plus a fixed fee of around $0.10 per swipe. These rates are pretty competitive, and cheaper than other companies in this space. Dharma also charges monthly fees that can somewhat increase the overhead costs. This is why if you’re just getting your feet wet with credit card processing, it may be better to go with processors meant for startups, like Square.

Bottom Line: Dharma is a transparent and relatively low-cost credit card processor for mid-to-large sized businesses. If you are a startup processing less than $10k per month, you may want to consider alternatives like PayPal or Square.

Dharma Merchant Services Fees, Features & Benefits

Dharma Merchant Services uses easy-to-understand interchange-plus pricing for all their credit card processing solutions. You have three different packages to choose from – one for online eCommerce businesses, one for storefronts, and a third specifically created for restaurants. The per-swipe fees differ slightly, depending on which of these solutions you end up going with.

Regardless of which plan you choose, Dharma Merchant Services charges $10 monthly fee plus a $7.95 PCI compliance fee. There are no contracts, so you don’t need to pay any fee for terminating your business with Dharma at any point. Other fees may apply to special transactions. You can view all of the charges on Dharma’s website.

Dharma Merchant Services Credit Card ProcessingDetails
Swipe Fees
  • Storefront: Interchange + 0.25% + $0.10
  • Restaurant: Interchange + 0.20% + $0.07
  • Virtual: Interchange + 0.35% + $0.15
Select Fees
  • Monthly: $10
  • Account Closure: $25
  • PCI Compliance: $7.95/month
Monthly MinimumNone
DiscountsVolume discounts begin at $50,000+ monthly sales. Special rates available for Non-profits.

When it comes to processing online transactions, Dharma provides you with two separate gateways for handling credit card data. You can use Dharma/NMI or Authorize.net. From a cost side of things, both are fairly comparable. NMI seems more feature-rich, as it offers the option for email invoicing ($0.05/invoice) and QuickBooks integration ($10/month). Unlike Authorize.net, NMI also allows the processing Level 3 card data – though this only applies to businesses handling government and large B2B industry payments.

How Much Will Dharma Merchant Services Cost Your Business?

In line with their emphasis on transparency, Dharma provides an online tool for estimating the true cost of accepting card payments. You can see the tool yourself here. In case you don’t want to fill out any forms, we ran through a few simulations here to give you a quick idea of how costs can vary for a variety of business profiles.

Transaction Volume (Monthly)RetailCharity/Non-profitRestaurant

The above estimates are based on an average transaction size of $50, where 20% of the transactions are made with debit cards, and there is a mix of cheap and expensive credit cards used by the customers.

American Express OptBlue

When it comes to processing American Express cards, pricing works a little differently. Dharma Merchant Services will automatically enroll their clients in the American Express OptBlue program. While there is no additional monthly cost, you will be generally paying more for these transactions. The following table shows a sample of transaction costs for retail businesses through OptBlue.

Transaction AmountTransaction Fee
Below $752.15% + $0.20
$75 - $1,0002.50% + $0.20
$1,000+2.95% + $0.20

As a business, you may choose to not accept American Express cards. However, Amex makes up about 9.1% of all credit cards globally. Consider the business you’d be giving up by turning away these customers.

How Does Dharma Merchant Services Compare To Other Credit Card Processors?

For the purposes of creating a comprehensive review, we examined how Dharma Merchant Services stacks up against their competitors. Here is a selection of other popular credit card processors and how Dharma compares.

Dharma Merchant Services vs Helcim

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While the two are very similar, we generally recommend Helcim more for newer businesses with lower monthly transaction volumes. They engage is a similar pricing structure to Dharma – interchange plus. Helcim’s markup on retail transactions is around 0.18%, compared to Dharma’s 0.25% + $0.10. However, because merchant services providers and credit card processors are frequently amenable to custom pricing, we recommend reaching out to both companies and comparing quotes. Depending on your line of business, and the types of transactions you process month-to-month Dharma may very well end up being cheaper.

When we measured Dharma Merchant Services and Helcim on other factors, they scored similar marks. Both are among the most transparent out of all credit card processors we’ve looked at. Furthermore, they are both favorably reviewed by their clients, and offer a similar suite of add-ons and customer support. This is why we highly recommend making your judgment between the two based on the price you’re quoted.

Helcim Details

  • 0.18% markup (interchange plus pricing)
  • $12 - $25 monthly PCI fees
  • No monthly minimums
  • Helcim Review

Dharma Merchant Services vs Payline Data

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Payline Data is another good credit card processor, though it’s generally more expensive than Dharma at processing online payments. The interchange markup on those transactions is nearly double that of what Dharma charges. Payline Data users pay 0.65% on top of the interchange rate. Dharma’s eCommerce markup is just 0.35% + $0.15. When it comes to other transactions, we found Payline Data to be consistently more expensive per swipe when looking at the prices posted to their site, albeit slightly. However, businesses transacting over $50,000 each month should examine the volume discounts each of the companies provides.

The one area where Payline Data has an advantage over Dharma Merchant Services is for online startups. Because their eCommerce platform doesn’t charge an monthly fee, the cost for businesses processing below a small amount each month may end up being cheaper.

Payline Data Highlights

  • Markup between 0.3% and 0.5%, depending on the plan chosen
  • $0 to $19.95 monthly fees
  • Payline Data Review

Dharma Merchant Services vs Chase Paymentech

Chase Paymentech is one of the largest credit card processors in the country that caters towards large, enterprise-level businesses. They are on the opposite side of the spectrum from Dharma, when it comes to transparency and pricing. First, the company advertises only tiered-pricing on their website, which is generally unfavorable for business owners. Chase Paymentech does offer interchange plus pricing, though you must ask for it specifically over the phone, which made it difficult to compare for different volume levels.

Our advice for comparing Chase Paymentech to Dharma is to call up the former and obtain a quote with their interchange plus model. Don’t allow them to talk you into the tiered pricing, as it can obscure your true cost in the future. Assuming you have a good idea of what your interchange-plus price will be (including any monthly fees and PCI compliance fees), you should feel comfortable choosing the more affordable option. Chase Paymentech comes with a lot of the bells and whistles you probably want, including a 24/7 help desk.

Chase Paymentech Highlights

  • Tiered pricing by default. Interchange plus available upon request
  • Intended for big businesses
  • Chase Paymentech Review

Yowana is a former product analyst at ValuePenguin, specializing in credit cards, rewards programs and travel. He previously covered mortgages, banking and insurance for the website. Yowana graduated from Columbia University with a B.A. in Political Science.