Understanding Common Credit Processing Fees, Part 1

At Merchant Card Advisors, we’re your go-to entity for credit card processing across multiple fields. Whether you’re a loan lender who needs solutions for processing payments or a small business who wants to maximize your profits in every little way, we’re here to help.

Regardless of which type of client you are, you’ll receive a processing statement from us each month that details the services we provided and several other basics. Included in this statement will be your basic processing fees, plus potentially a few other related industry fees – what do all of these mean? Are there some you can avoid? In this two-part blog, we’ll go over all the various processing fees you might run into over the course of your credit card services, plus what you can do about certain ones of them.

credit card processing fees

Non-Compliance Fees

There are a couple fees that relate to general compliance, so it’s important not to get them mixed up. One of these is the PCI Compliance fee, which has to do with maintaining security standards and procedures outlined by credit card processors – we’re not talking about that here, as it’s a limited yearly charge we’ll make you aware of.

Rather, we’re discussing a fee that’s charged when you’re not registered as PCI Compliant, plus are considered to not be keeping your customers’ credit card information properly. Fees for non-compliance will usually be between $20 and $25 per month, which may not seem like much, but they can quickly add up over time. To get rid of this fee, you should contact our pros about how your business can become PCI compliant. This is usually a relatively simple process.

Interchange and Assessment Fees

Merchants always have to pay some concrete costs to banks and credit card associations who issue credit lines, and these fees are called interchange. These are the majority of your costs on your processing statement. Generally, they’re calculated using a fee plus another flat price point. Take Visa Business, for example – they charge 2.200 percent plus 0.10, while a comparable card like Visa Keyed Retail is 1.800 percent plus 10. These fees are not negotiable in most cases.

In addition, your bill will include assessment fees based on your monthly transaction volume. The cost here is usually about 0.11 percent per transaction, and this fee goes directly to the credit card company issuing the card.

Incidental or Chargeback Fee

This is an area that’s outside your control – if a customer initiates a chargeback situation, your business will generally be charged the $75 fee. This comes directly from the bank of the cardholder, and refunds will not be possible. This is on top of funds already being withdrawn in the dispute, of course.

For more on the kinds of fees you might see on your processing statement, or to learn about any of our credit card processing services, speak to the pros at Merchant Card Advisors today.

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