The Card-Cost Checklist: Check Your Processing Fees in 15 Minutes
A free seven-step checklist for checking your credit card processing statement: calculate your effective rate, separate processor markup from interchange, and find the recurring fees worth questioning.
Short answer
Pull your last three processing statements, divide total fees by total card sales to get your effective rate, identify your pricing model, separate interchange from processor markup, list every fixed and recurring fee, check your contract for termination and auto-renewal terms, and then ask your processor the three questions below.
The seven checks
1.Pull your last three statements
Download the three most recent monthly statements from your processor's portal. One month can be skewed by a holiday or a large refund; three months gives a fair picture.
Guide: How to Read a Merchant Processing Statement2.Calculate your effective rate
Add up every fee on all three statements, including equipment rental and any gateway or software charges billed separately, and divide by total card sales for the same months. Divide total by total; do not average three monthly percentages.
Guide: How to Calculate Your Effective Processing Rate3.Identify your pricing model
Interchange-plus statements list interchange separately from the processor's markup. Tiered statements show qualified, mid-qualified, and non-qualified rates. Flat-rate statements show one percentage for every card. The model decides which numbers you can negotiate.
Guide: Interchange-Plus vs. Tiered vs. Flat-Rate Pricing4.Separate interchange from processor markup
Interchange and card-network fees are set by Visa, Mastercard, and the issuing banks and are the same for every processor. Everything above them is markup, and markup is the only part that is negotiable.
Guide: What Are Interchange Fees and Who Sets Them?5.List every fixed and recurring fee
Write down each monthly, annual, and per-batch charge: statement fee, monthly minimum, PCI compliance or non-compliance fee, batch fee, gateway fee, account-on-file fee, and terminal rental. Note any fee you did not agree to or that appeared after you signed.
Guide: 13 Merchant Statement Fees Worth Questioning6.Check your contract terms
Find the early termination fee, the auto-renewal clause, and any separate equipment lease. A non-cancellable lease or a liquidated-damages termination clause changes what switching or renegotiating costs.
Guide: Early Termination Fees in Merchant Contracts7.Ask your processor three questions
1) What is my markup over interchange, as a percentage and per-transaction amount? 2) Which recurring fees can you remove or waive? 3) What does it cost to leave, and when does my contract renew? Get the answers in writing.
Guide: How to Negotiate Lower Credit Card Processing Fees
Effective rate calculator
Use one month, or better, three months of totals from your statements.
Enter both totals to see your effective rate.
Frequently asked questions
What is a good effective rate for credit card processing?
It depends on your card mix. A business taking mostly in-person debit and standard credit cards sits much closer to the interchange floor than an online business taking premium rewards cards. Compare your rate against the floor for your own mix rather than a single industry average.
Which processing fees can I negotiate?
The processor's markup and its own fees: the percentage or per-transaction amount above interchange, monthly and annual fees, PCI program fees, batch and gateway fees, and equipment charges. Interchange and card-network assessments are set by the card networks and are the same for every processor.
Do I need to switch processors to lower my fees?
No. Many businesses lower their effective rate by asking their current processor to remove recurring fees or reduce its markup. Knowing your effective rate and markup is what makes that conversation productive.
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