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By ActivityPay
You take a phone booking for a group rafting trip and key in the credit card details. Processing fee: 3.2%. Later that day, a walk-in customer swipes their card at your shop for equipment rental. Same credit card company, same amount, but this time: 2.1%. What just happened?
Most adventure operators notice these rate differences but don't understand why they exist—or how much money they're leaving on the table because of it. The answer comes down to risk, and once you understand how card companies assess it, you can structure your booking process to qualify for better rates without creating friction for your guests.
When you physically swipe, dip, or tap a card, the bank calls this "card present." When you key in numbers over the phone or process an online booking, it's "card not present." The rate difference isn't arbitrary—it reflects fraud risk.
With a card-present transaction, the bank knows the physical card was there. The chip contains security features that are nearly impossible to counterfeit. If someone disputes the charge, you have stronger evidence that the transaction was legitimate. Card companies reward this lower risk with lower interchange fees (the base cost that goes to the card-issuing bank).
Phone bookings and online reservations lack this physical verification. The person entering those numbers could be using a stolen card number. The chargeback rate for card-not-present transactions runs about four times higher than card-present ones. Card companies price this risk directly into your processing rate.
For adventure operators specifically, this creates a challenge. Unlike retail stores where most transactions happen face-to-face, you're taking deposits months in advance, processing group bookings over email, and charging final payments before guests arrive. The majority of your revenue likely flows through card-not-present channels—which means you're paying the higher rate most of the time.
Understanding what you're actually paying helps you know where you can improve. Every transaction has three cost layers:
This is the base cost set by Visa, Mastercard, and other card networks. It goes directly to the bank that issued your customer's card. For a standard consumer credit card:
That 0.3% to 0.8% difference adds up fast. On $500,000 in annual bookings, paying the higher rate on transactions that could qualify for the lower one costs you $1,500 to $4,000 per year.
The card networks (Visa, Mastercard, etc.) charge these. They're typically 0.13-0.15% regardless of how the card is processed. You can't control these.
This is what your payment processor adds on top. It might be a percentage, a flat fee, or both. Different processors handle card-present versus card-not-present markups differently—some charge the same markup regardless, others add extra for keyed transactions.
The good news: you have more card-present opportunities than you might think. Here's where adventure operators often miss chances to process at the lower rate:
If guests owe a balance when they arrive, collect it in person with a card reader rather than charging the card on file. You've already got the customer there—taking 30 seconds to process a card-present transaction saves you 0.5-1% on what might be 50% of the total booking value.
Photo packages, equipment upgrades, retail items, additional activities—if guests are purchasing these on-site, always process them as card-present. Set up your system so guides or desk staff can easily accept these payments in the field or at your location.
Many operators let guests add tips for guides when they check out. If you're automatically charging a tip to the card on file, you're paying the card-not-present rate. Instead, use a mobile card reader to collect tips as card-present transactions when guests are there in person.
Walk-ins and last-minute bookings where customers are standing at your counter should always be processed as card-present. Make sure your staff knows to swipe or tap rather than typing in numbers manually, even when it seems faster to key them in.
Here's a practical approach that balances convenience with processing costs:
Take deposits as card-not-present. You need to secure bookings in advance, and asking customers to come to your physical location just to make a deposit creates unnecessary friction. Accept that you'll pay the higher rate on these initial payments.
Collect final payments card-present when possible. For multi-day tours, adventure packages, or any booking where guests physically check in with you, structure your payment schedule so the larger final payment happens in person. If you're currently taking 50% deposits and charging the remaining 50% automatically before arrival, consider taking 30% deposits and collecting the 70% balance at check-in.
The rate savings on the larger payment more than makes up for the processing cost on the smaller deposit. On a $1,000 booking, this approach might look like:
Compare that to processing the entire $1,000 as card-not-present:
You've saved $3.50 per booking. With 500 bookings per season, that's $1,750 back in your pocket.
Changing your payment structure only works if you have the right equipment. Here's what adventure operators need:
Your guides should be able to accept card-present payments in the field—at the trailhead, on the river, at the zipline platform. Mobile readers that connect to smartphones or tablets via Bluetooth let guides process balance payments, collect for add-ons, and take tips without guests needing to carry cash.
If your payment processor doesn't talk to your booking software, you'll never implement a deposit-plus-balance-at-checkin strategy. You need systems that can flag which bookings still need final payment and make it easy for desk staff to pull up the right customer and charge the remaining balance when they arrive.
Even if most bookings come through your website, you need a countertop or portable terminal where guests physically present. This handles check-in payments, retail sales, and same-day bookings at the lower card-present rate.
Online bookings will always be card-not-present—there's no way around it. But you can still optimize these transactions to qualify for the best possible card-not-present rates:
Collect complete information. Include billing address, CVV code, and email address. Transactions with more verification data qualify for better interchange categories.
Process within 24 hours of authorization. If you authorize a card when someone books but don't capture the payment until weeks later, you may get bumped to a higher interchange category.
Send confirmation emails. Digital receipts and booking confirmations reduce chargeback risk, which helps with long-term rate negotiations even if they don't affect individual transaction rates.
Even when you have the customer's physical card, certain practices can prevent you from qualifying for card-present rates:
Manually keying in a card that's right in front of you. If your card reader isn't working or seems slow, staff might type in the numbers manually. This processes as card-not-present even though the card was there. Fix your equipment rather than working around it.
Processing batch settlements late. Transactions need to settle within a certain timeframe to qualify for the best rates. If you batch out every few days instead of daily, you might get charged higher rates.
Not capturing the card data properly. Chip cards need to be dipped, not swiped. Contactless cards should tap, not get keyed in. Using the wrong method for the card type can result in the transaction being treated as card-not-present.
Restructuring how you handle payments requires some upfront work—training staff, adjusting your booking flow, maybe changing your payment terms slightly. Is it worth it?
Run your own numbers. Look at your total annual processing volume and estimate what percentage you currently handle as card-not-present. Calculate what you'd save by converting even 30-40% of that volume to card-present rates. For most adventure operators processing $500,000 to $2 million annually, optimizing card-present versus card-not-present transactions saves $2,000 to $8,000 per year.
That's not just lower expenses—it's money you can reinvest in better equipment, marketing for shoulder season bookings, or simply better cash flow during your slower months. And unlike negotiating with your processor for a lower rate (which they may or may not give you), qualifying for better interchange categories is entirely within your control.
The rate difference reflects fraud risk. Card-present transactions (swiped, dipped, or tapped) have physical security features that are nearly impossible to counterfeit, while card-not-present transactions have chargeback rates about four times higher. Card companies price this increased risk directly into processing rates, typically charging 0.5-1% more for keyed or online transactions.
For adventure operators processing $500,000 to $2 million annually, converting 30-40% of card-not-present transactions to card-present can save $2,000 to $8,000 per year. On individual bookings, the savings might be $3-4 per transaction, but this adds up significantly over hundreds of bookings per season.
Take smaller deposits (around 30%) as card-not-present when customers book remotely, then collect the larger final payment (70%) as card-present when guests check in. This balances booking convenience with processing cost savings, since you'll pay the lower rate on the majority of the transaction value.
You need mobile card readers that connect to smartphones or tablets so guides can process payments in the field, a countertop terminal at your physical location, and integration between your payment processor and booking system. This setup allows you to easily collect balance payments, add-ons, and tips at the lower card-present rate when guests are on-site.
While online bookings will always be card-not-present, you can qualify for better rates within that category by collecting complete verification information (billing address, CVV, email), processing transactions within 24 hours of authorization, and sending confirmation emails. These practices reduce fraud risk and help you qualify for lower interchange categories.