Are You Paying Too Much
to Process Credit Cards?
A quick look at your processing statement can show what you’re really paying,
where the fees come from, and whether there may be room to save.
Start with the numbers on your statement
Calculate your effective rate
Total processing fees ÷ total
card volume = effective rate.
Separate interchange
Interchange is largely set by
the card networks and banks.
Find the processor markup
Processor markup and added fees
can vary significantly.
See what a small change means
At higher volume, even a small
rate difference adds up fast.
Want a second set of eyes?
PAIR will review your statement and show you where the fees are coming from.
The easiest way to tell what credit card processing is costing you
If your business accepts a meaningful amount of credit card volume, your processing statement is worth reviewing from time to time. Rates are not as standardized as many business owners assume, and the difference between two pricing setups can become meaningful as volume grows.
A useful starting point is your effective rate. Instead of focusing on one advertised percentage, your effective rate looks at the total amount you paid compared with the total amount you processed.
÷ Total card volume
= Effective processing rate
For example, if you processed $100,000 last month and paid $3,500 in total processing fees, your effective rate was 3.5%.
Have a recent processing statement?
PAIR can review it, calculate your effective rate, break down the fees, and show you whether there may be opportunities to lower your processing cost.
Review my statement for freeWhy the effective rate is only the beginning
Once you know your effective rate, the next question is what is actually creating it. A processing statement can contain several different types of costs, and not all of them work the same way.
Interchange
Interchange is generally paid to the card-issuing bank and varies based on the card and transaction type. This portion is largely outside the processor’s control.
Card-network fees
Visa, Mastercard, Discover, and American Express may assess additional network-related fees associated with accepting their cards.
Processor markup
This is where pricing can differ substantially between processors. The markup may appear as a percentage, per-transaction fee, bundled rate, or other pricing structure.
Other account fees
Monthly fees, PCI fees, gateway fees, statement fees, equipment charges, and other account-level costs can increase your true all-in rate.
What a small rate difference can mean
A fraction of a percentage point may not sound important until you apply it to a full year of processing volume.
| Annual card volume | 0.25% difference | 0.50% difference |
|---|---|---|
| $250,000 | $625 / year | $1,250 / year |
| $500,000 | $1,250 / year | $2,500 / year |
| $1,000,000 | $2,500 / year | $5,000 / year |
| $2,000,000 | $5,000 / year | $10,000 / year |
The goal is not simply to find the lowest advertised rate.
The useful comparison is your total processing cost after interchange, processor markup, transaction charges, monthly fees, and any other recurring costs are included.
See what I’m actually payingWhat should you look for on your processing statement?
Statements vary by processor, but these are some of the most useful numbers to identify before comparing your current setup with another option.
| What to find | Why it matters |
|---|---|
| Total card volume | This gives you the denominator for calculating your effective rate. |
| Total processing fees | Include the full amount charged for the month rather than one advertised rate. |
| Interchange costs | This helps separate underlying card costs from the processor’s pricing. |
| Processor markup | This is one of the areas where different processors and pricing models may vary. |
| Monthly and miscellaneous fees | Small recurring charges can materially affect your all-in cost over a year. |
A simple example
Imagine your business processed $100,000 in card payments last month and the total fees on your statement came to $3,500.
Monthly card volume
$100,000 Total credit and debit card volume processed during the monthTotal processing fees
$3,500 All processing-related fees charged for the same periodFrom there, you can look deeper at how much of that 3.5% came from interchange and network costs versus processor markup and other fees.
You don’t have to decode the statement yourself
Send PAIR a recent processing statement and we’ll break down what you’re paying, explain where the charges come from, and show you whether there may be a more cost-effective setup.
Get my free statement reviewCommon questions about processing costs
What is an effective processing rate?
Your effective rate is your total processing fees divided by your total card volume for the same period. It gives you a simple all-in percentage for what processing actually cost.
Can I negotiate credit card processing rates?
Some underlying costs, such as interchange, are generally not negotiable with your processor. Processor markup, pricing structure, and certain account fees may vary, which is why comparing the full statement can be useful.
How often should I review my processing statement?
It can be worth reviewing periodically, especially if your processing volume has grown, your pricing has changed, new fees have appeared, or you have not compared your costs in a while.
Do I have to switch processors if PAIR reviews my statement?
No. The purpose of the review is to help you understand your current costs and see whether another option may make sense. You can use the information even if you decide to stay with your current processor.
What should I send for the review?
A recent credit card processing statement is the best starting point because it shows your processing volume, pricing structure, and the fees charged to your account.
Find out what you’re actually paying
PAIR Payments reviews processing statements and breaks down your effective rate, interchange costs, processor markup, and other fees so you can see whether there may be opportunities to lower your cost.
- Free statement analysis
- Effective-rate calculation
- Fee and markup breakdown
- No obligation to switch