support@merchantfeeremoval.com
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CREDIT CARD

PROCESSING

FEES AND COSTS

In each business transaction involving credit cards, processing fees take a bite out of the total profits. We generally see credit card processing fees be somewhere around 2% of each purchase - you can see network specific rates in the graph below. 

Businesses have some power to minimize costs by shopping around different payment processors. They can end up receiving competitive rates that can end up saving them a significant amount of money over time. In order to be able to shop around, it's important to be well versed in the topic at hand. 

To that end, we've put together this guide on credit card processing fees, so that merchants are better equipped when setting up credit card payments for their business.
MASTERCARD
1.55% - 2.6%
VISA
1.43% - 2.4%
DISCOVER
1.56% - 2.3%
AMEX
2.5% - 3.5%
These values are an estimated average.
In reality, much more goes into processing fees for a business and individual fees will highly vary based on a number of factors. Here's a look at some of the costs that contribute the most.

THE DISCOUNT RATE

The percentage of a sale that goes towards paying credit card processing fees is referred to as the discount rate. This involves all the fees which are paid to card issuers and networks via interchange fees and assessment fees. These sections give an overview of what factors can impact these fees.

AMERICAN EXPRESS PROCESSING FEES

American Express is a special case, as it is the only card network that is also a card issuer. Amex's unique position also makes them work a little differently when it comes to credit card processing fees. With this issuer, they tend to be more expensive than what other networks charge, especially when it comes to processing returns.

OTHER COSTS & FEES

Accepting credit card payments comes with some additional costs to consider. In many cases you will be required to pay a monthly fees to your MSP, as well as cover the cost of card readers. This section outlines some common practices by payment processors, which you should be aware of before beginning to shop comparatively.

A NOTE ABOUT ACCEPTING CREDIT CARD PAYMENTS

In order to accept credit cards as a form of payment, most businesses will need to sign up with a merchant services provider. These MSPs act as middlemen between the merchant and the credit issuer. For a fee, they are the ones that handle processing of all credit card payments for your business - everything from collecting interchange fees to managing the transfer of funds between the merchant's bank and the credit issuing bank. 

When shopping around for MSPs, sometimes referred to as acquirers, you will want to collect as many price quotes as possible. Below we detail the major costs that influence the price you get quoted, and tell you which ones you have power to negotiate. 

DISCOUNT RATE

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CC INTERCHANGE FEE

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ASSESSMENT FEES

LEARN MORE  〉

MSP MARKUP FEES

LEARN MORE  〉

AMEX PROCESSING FEES

LEARN MORE  〉

OTHER FEES AND COSTS

LEARN MORE  〉
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