Credit Card Processing Fees

Monthly fees
Card terminals are normally provided on an ongoing monthly rental basis - they’re not ‘owned’ by your business. Then, there are other potential monthly fees to consider, such as a minimum monthly service charge (MMSC), which is essentially the minimum charge for not meeting the number of monthly transactions agreed between you and your provider.




One off fees
One of the most common examples of a one off fee would be the charge that some providers might require in order for you to obtain PCI DSS compliance status. With most providers, there is also a single, standalone fee for set-up - while each and every transaction processed will also have its own one off fee charged on top. These are often called ‘transaction fees’ or ‘merchant services fees’.

These are some of the most common monthly and one off fees that you’re likely to encounter. However, there are a variety of other fees that could crop up - and you’ll find these listed in our comprehensive card payments guide.

As far as the different payment methods are concerned - each method is likely to have it’s own fees and charges to consider…




Card machine
As explained above, hiring the card machine terminals used across your business is like renting a piece of equipment in most circumstances. This will normally consist of a monthly rental charge - and the card machine cost will vary from provider to provider.




Virtual terminal
As the name suggests, you don’t physically hire a virtual terminal in the way that you would pay a monthly rental to keep hold of card machines. All you need is a laptop or tablet with an internet connection. As a result, you’ll probably encounter similar fees to those you’d find with payment gateway solutions.




Payment gateway
Perhaps your business doesn’t rely on card machines to facilitate card payments? Online businesses with payment gateway solutions might also find themselves subject to various fees and charges for transactions, authorisation and compliance - on top of any merchant fees to the provider. With most providers, every payment gateway solution comes with a virtual terminal - so you’d need to consider the fees and charges associated with both.

Merchant Service Charges

For every transaction made across any credit card payment solution there is a fee... This is a combination of various charges, which can be seen below.

Credit / Debit card charges

A small percentage of each transaction taken as fees - and this varies depending on the type of card. For consumer cards this can be as low as 0.35% and for some
commercial cards this can be as high as 2.29%.

Minimum Monthly Service Charge

This fee only applies if your transactions fall below a certain benchmarked level agreed by your provider. Essentially, if your other fees exceed this level, you won’t need to
pay a minimum monthly service charge (MMSC).

Authorisation fees

Authorisation fees are usually a flat fee as opposed to a percentage of the transaction. They are exactly as the name suggests - a fee that’s charged by the processing
provider to actually authorise the payment.
This is usually between 1-4p per transaction - although some providers don’t charge a penny for authorisation.

Premium card charges

In some cases, processing payments from premium credit cards (like American Express cards, for instance) might be more expensive.
Transaction fees are often higher for premium card transactions - so this is definitely one to bear in mind if you want to process these types of payments across your
business.

CNP fees

When it comes to card not present (CNP) transactions, many providers are likely to have heightened security measures in place as a means to prevent fraud.
As a result, you might find that these transactions carry additional fees to cover the cost of certain security features.

Statement & reporting charges

Some providers may include a fee for providing you with your credit card processing statement at the end of each month.

PCI compliance fee

Again, this is another monthly administrative fee for the completion of your PCI Self Certification Questionnaire and compliance certificate. It’s a necessary outgoing to
ensure that your business remains a reliable, trustworthy and compliant merchant who can be trusted to take card payments safely and securely.

Early termination fees

As with most agreements where a contract is in place between the customer and the supplier, an early termination fee applies should you decide to cancel ahead of time.
Again, this will vary from provider to provider.

Set-up fees

The cost of setting up the solution. This is normally a one-off upfront fee charged by some providers. Everything from manual card machine installation to setting up your
merchant account would be absorbed into this overall cost.

Chargeback fees

Card issuers generally have a chargeback mechanism in place to enable them to reclaim money from the merchant’s bank if required (i.e. refunds). Therefore, this is an
administrative fee that is only charged on case-by-case basis - it’s not charged for every transaction.

Swapout fees

If your terminal breaks, some suppliers insist that an engineer visits you to fix it, which incurs a charge. Others will send you a replacement terminal, which you can install
yourself for free.