Helping you make sense of credit card processing fees

Everything you need to know about the fees charged by credit card payment processors.

Helping you make sense of credit card processing fees

Everything you need to know about the fees charged by credit card payment processors.

Helping you make sense of credit card processing fees

Everything you need to know about the fees charged by credit card payment processors.

What is a payment processing fee?

If your business accepts card payments from your customers, your provider will charge fees for handling your card transactions.

This is the amount your payment processing provider charges you for each card transaction your business makes. There are three main types of payment processing fees:

  • Transactional fees
  • Flat fees
  • Incidental fees

Who are the key players?

Credit card associations
These are companies that create credit cards, like Visa, MasterCard, and American Express. They’re sometimes called credit card networks.

Credit card issuing banks
Credit card issuing banks are banks like Chase, Citi, and Wells Fargo that issue cards to customers. Some card associations like Discover and American Express issue their own cards.

Credit card processors
Sometimes called acquiring banks or acquirers, these institutions act as the middleman between merchants and credit card associations. They pass funding information and authorization requests along so that merchants can complete transactions.

Merchant account providers
These are companies that manage credit card processing for merchants, usually with the help of an acquirer. 

Payment gateways
Used in e-commerce, these are online payment portals that send transactions from the merchant to the acquirer.

Transactional fees

Every time a customer pays with a credit or debit card, you have to pay a transactional fee to the card-issuing bank or credit card association. 

Flat fees 

You may also be charged additional flat fees on top of transactional fees. These charges vary and some are only applicable to certain types of merchants, payments, or situations. 

Incidental fees

Unlike flat fees, incidental fees are only charged if certain criteria are met. You may not have to pay them every month.