Understand how processing fees work, what merchants actually pay, and how to reduce your costs with our complete guide.
Every time a customer pays with a credit or debit card, your business pays a processing fee. These fees typically range from 1.5% to 3.5% of each transaction and are split among three parties.
Interchange fees are set by card networks like Visa and Mastercard and paid to the card-issuing bank. They make up the largest portion of your processing costs, typically 1.2% to 2.5% per transaction. These fees vary based on card type, transaction method, and merchant category code.
Also called assessment fees, these are charged by Visa, Mastercard, Discover, and American Express for using their payment networks. They typically range from 0.13% to 0.15% of transaction volume and are non-negotiable.
This is what your payment processor charges on top of interchange and network fees for handling the transaction. It varies widely between processors and is the most negotiable component of your processing costs.
On a $100 credit card sale, a typical fee breakdown looks like this:
Processing fees vary significantly by industry due to differences in transaction size, chargeback risk, and payment methods.
| Industry | Typical Rate |
|---|---|
| Retail | 1.5% - 2.5% |
| Restaurant | 1.8% - 3.2% |
| Salon | 1.9% - 3.3% |
| Auto Repair | 1.7% - 3.0% |
| Medical | 1.9% - 3.4% |
Use our processing fees calculator to estimate your exact costs.
Processors use different pricing structures that affect how much you pay.
With flat-rate pricing, you pay a single fixed percentage on every transaction. Square charges 2.6% + $0.10 per swipe, while Stripe charges 2.9% + $0.30 for online payments. Simple but often more expensive for businesses processing over $10,000 per month.
Tiered pricing groups transactions into qualified, mid-qualified, and non-qualified categories. Most transactions fall into the more expensive tiers, making this the least transparent pricing model.
Interchange-plus passes through the actual interchange fee and adds a fixed markup on top. For example, interchange + 0.25% + $0.10 per transaction. This is the most transparent model and typically the best value for businesses processing more than $5,000 per month.
Beyond standard transaction fees, many processors add charges that increase your costs:
Our free statement audit identifies every hidden fee on your statement.
Find out exactly how much you are paying in credit card processing fees and discover potential savings.
Calculate My Processing FeesProcessing fees vary by industry. Use our specialized calculators for your business type:
Upload your merchant statement and our team will analyze it line by line to find hidden fees and savings.
Upload Your Merchant Statement for a Free AnalysisCredit card processing fees are charges that merchants pay each time a customer uses a credit or debit card. These fees include interchange fees paid to the issuing bank, card network assessment fees, and the processor markup.
The average merchant processing rate ranges from 1.5% to 3.5% per transaction, depending on the industry, card type, and pricing model.
Multiply your monthly credit card volume by your effective rate. Use our free calculator for an accurate estimate.
Negotiate with your processor, switch to interchange-plus pricing, encourage debit card use, maintain PCI compliance, and get a free statement audit.
A transparent pricing model where you pay the actual interchange fee plus a fixed markup from your processor. Generally the most cost-effective model for businesses processing over $5,000 per month.
