--- title: What is Billback and How Do Rate Plans Mislead Business Owners description: Business owners find Billback rate plans appealing, but they often come with markups and hidden fees that are charged after the fact. image: https://blog.payjunction.com/hubfs/BLOG/FEATURED%20IMAGES/billback-unethical-billing.svg --- [tel:1-800-601-0230](tel:1-800-601-0230) 800-601-0230 - Features - Solutions - Developers - [Pricing](https://www.payjunction.com/payments/pricing.html) - Resources [See a Demo](https://www2.payjunction.com/tour-payjunction) Features - EXPLORE PRODUCTS [No-code Payments Integration®](https://www.payjunction.com/payments/no-code-payments-integration.html) [ZeroTouch Terminal](https://www.payjunction.com/payments/smart-terminal.html) [Portable Terminal](https://www.payjunction.com/payments/portable-credit-card-reader-terminal.html) - ACCEPT PAYMENTS [Invoices](https://www.payjunction.com/payments/electronic-invoices.html) [ACH Electronic Checks](https://www.payjunction.com/payments/ach-payments.html) [SmartSurcharge®](https://www.payjunction.com/payments/smart-surcharge.html) [Cards on File](https://www.payjunction.com/payments/store-credit-card-info.html) [Rapid Refunds](https://www.payjunction.com/payments/credit-card-refund.html) [Recurring Billing](https://www.payjunction.com/payments/recurring-payments.html) [Ecommerce](https://www.payjunction.com/payments/ecommerce-merchant-services.html) [Mobile App](https://itunes.apple.com/us/app/payjunction/id1324839420?ls=1&mt=8) - EXPLORE CAPABILITIES [Overview](https://www.payjunction.com/payments/payment-processing-solutions.html) [Integration Marketplace](https://integrations.payjunction.com/) [Remote Signature](https://www.payjunction.com/payments/signature-capture.html) [Multi-Location](https://www.payjunction.com/payments/enterprise-payments.html) [Sales Reports](https://www.payjunction.com/payments/sales-reports.html) [Search and Export](https://www.payjunction.com/payments/transaction-history-search.html) [Customization](https://www.payjunction.com/payments/custom-payment-software.html) Solutions - [Veterinary Streamline payment workflows and get paid faster with up-front deposits and payment schedules for high-cost procedures. 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In the unfortunate event you work with an [unethical](https://blog.payjunction.com/tag/unethical-billing/) Merchant Account Provider, you may end up on Billback or worse, Enhanced Billback. You may hear a few different terms for Billback, such as Enhanced Recover Reduced, blended rate or mixed rate. Regardless, any variation of Billback is bad for business, no matter how appealing it may seem. What’s worse, these rate plans are so confusing you may be on some variation and not even realize it. ## Payment Processing Demo Schedule 15 minutes with a payments expert Get a customized PayJunction product walk-through Understand requirements and pricing Determine your SAVINGS! GET DEMO NOW ## What Is Billback? It breaks down like this: - Your provider proposes a flat rate, for example 1.79% - You’re charged 1.79% on every transaction on that month’s statement - Your provider later reviews those transactions and determines which did not qualify for the Interchange cost proposed - You’re charged the difference to make up for the true cost of the non-qualifying transactions on the following month’s statement Interchange varies depending on the card type and transaction method, so not all transactions have the same wholesale cost. Your provider banks on you not knowing this so you think you’re paying one rate for all transactions you take. On statements, Billback is typically denoted as BB in the description, sometimes ERR for Enhanced Recover Reduced. The month of the original transaction is usually in the description, as well. *![Statement-Billback-Rate-Plans-01](https://blog.payjunction.com/hs-fs/hubfs/BLOG/BLOG%20IN-LINE%20IMAGES/Statement-Billback-Rate-Plans-01.png?width=811&name=Statement-Billback-Rate-Plans-01.png)* *Note:* The statement period is for August, but the transactions are from July. The processing volume and fee breakdown (authorization fee ($) x number of transactions) are intentionally left out on the following month’s statement so you can’t determine the rate you are paying for the markup. Without two consecutive statements, there is no way to see the true rates paid. Even with both statements side by side, there isn’t enough data provided to determine the rate on the BB line items in the second statement. Confusing? You bet. Necessary? Absolutely not. ## Enhanced Billback Don’t be fooled by the slight name change, Enhanced Billback is actually much worse. Here’s how it works: - Your provider proposes a flat rate, for example 1.79% - You’re charged 1.79% on every transaction on that month’s statement - Your provider later reviews those transactions and determines which did not qualify for the Interchange cost proposed - You’re charged the difference to make up for the true cost of the non-qualifying transactions on the following month’s statement, ***along with a hidden markup*** So in addition to paying more than you were promised, you’re also paying a markup just because your provider can easily add it into complex statements. The transaction descriptions denote EBB, along with the month the transactions originally ran: *![Statement-Enhanced-Billback-01](https://blog.payjunction.com/hs-fs/hubfs/BLOG/BLOG%20IN-LINE%20IMAGES/Statement-Enhanced-Billback-01.png?width=833&name=Statement-Enhanced-Billback-01.png)* *Note:* The statement period is for June, but the transactions are from May. Like we said before, even with two consecutive statements, there isn’t enough info to determine the rate. What’s worse? For EBB, it’s actually impossible to know if the items have a hidden fee — which usually means they do. ## Pay What You’re Promised Unethical providers will promise you an appealingly low rate but fail to mention what’s to follow. Don’t be fooled; these plans are the least transparent. Check your statements for the description details that include volume and number of transactions on line items. If these key pieces of information are missing, then your provider is hiding fees from you. Get a professional analysis if you're unsure whether you're on some variation. If you don’t fully understand your rate plan, there’s a good chance you’re in the dark about certain fees. ## Get your statements checked for Billback. [![ANALYZE MY STATEMENTS](https://no-cache.hubspot.com/cta/default/635739/2183efee-83ec-47d3-80cb-871a46e35a93.png)](https://cta-redirect.hubspot.com/cta/redirect/635739/2183efee-83ec-47d3-80cb-871a46e35a93) Are you surprised by this rate plan? Are you questioning whether you’re current rate plan is some variation of Billback? Don’t hesitate to share your thoughts and start a conversation below. *Editor's Note: This post was originally published in January 2017 and has been updated for comprehensiveness and accuracy.*   [Unethical Billing](https://blog.payjunction.com/topic/unethical-billing) [Credit Card Processing](https://blog.payjunction.com/topic/credit-card-processing) --- ##### [![ACH Rejects and Processing Explained](https://blog.payjunction.com/hubfs/BLOG/FEATURED%20IMAGES/ach-processing-defined.svg) ACH Rejects and Processing Explained](https://blog.payjunction.com/ach-processing-defined) ##### [![How United Toyota Dealership Benefits From PayJunction Payment Processing](https://blog.payjunction.com/hubfs/BLOG/FEATURED%20IMAGES/united-toyota-united.svg) How United Toyota Dealership Benefits From PayJunction Payment Processing](https://blog.payjunction.com/rogers-and-rogers) ###### About Author ![Picture of Ursula Librizzi](https://blog.payjunction.com/hs-fs/hubfs/Ursula_Librizzi.jpg?width=200&height=200&name=Ursula_Librizzi.jpg) ### Ursula Librizzi Ursula is the sales and marketing operations manager for PayJunction. She oversees daily marketing tasks and liaises between the sales and marketing departments. ###### Related Posts ## [![Accepting Credit Cards: 5 Business Benefits](https://blog.payjunction.com/hubfs/BLOG/FEATURED%20IMAGES/accepting-credit-cards-benefits.svg) Accepting Credit Cards: 5 Business Benefits Whether you’re just starting out or have been in business for years, you may be toying with the idea of accepting credit cards. Sure, getting started may seem daunting. You have to apply for a merchant account, purchase a card reader, possibly add on some additional software and, on top of all that, hope you have customers who want to pay by card.](https://blog.payjunction.com/accepting-credit-cards-benefits) ## [![Printed Receipts: The True Cost](https://blog.payjunction.com/hubfs/BLOG/FEATURED%20IMAGES/printed-receipts-cost.svg) Printed Receipts: The True Cost If you’re like most business owners, you store every printed receipt from your credit card terminal and provide copies to your customers. It may be a routine you consider a best practice to protect your business, but the cost to maintain and store printed receipts significantly eats into your profits.](https://blog.payjunction.com/printed-receipts-cost) ## [![Ecommerce Credit Card Processor: The Basics](https://blog.payjunction.com/hubfs/BLOG/HERO%20IMAGES/Basic_Online_CC_Processing_svg_ShKTTNjD.svg) Ecommerce Credit Card Processor: The Basics Whether you’re just starting your first business or breaking into ecommerce after years of success with a retail store, there are a few foundational things to know about using an ecommerce credit card processor. 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