When it comes to finding the ideal payment gateway solution for your business, looking closely at the fees charged by providers is vital. Just as important when negotiating payment gateway fees is to know your business’s numbers. How much profit do you make on a single sale? What’s your average margin? The answers to these questions will largely dictate how much you will spend on payment gateway fees.
What fees can I expect to pay?
You may have to pay three different types of payment gateway fees. These are:
- A setup fee - As the name suggests this is a one-off fee you pay for the initial setup of your payment gateway account. Not all providers charge this, so it could be worth your time doing some research and finding a provider willing to waive this fee.
- An annual fee - This is an amount charged once each year for features, software, support, and any other services provided by the payment gateway provider.
- Transaction costs - This is an amount charged per transaction when a transaction is processed by your bank.
Getting the best deal
When comparing providers, keep in mind that the lowest fees don’t always mean the best value for your business. Providers might boast of lower fees to attract your business, but will the services they offer meet your needs and attract customers to you? Comparing fee structure, hidden fees in the fine print, conversion rate, and value-added services will help you to find the best deal for your business.
Aside from fees associated with your payment gateway, you will also be subject to payment processing fees charged by credit card processors for handling your card transactions. These include:
- Transactional fees, which are paid every time a transaction is processed.
- Flat fees, paid on top of transactional fees, some of which only apply to certain types of merchants and services.
- Incidental fees, which are non-regular fees paid only when certain criteria are met. For example, you would have to pay an incidental fee if you had insufficient funds in your bank account to cover any merchant account expenses.