Credit Card Processing Fees

When businesses accept credit card payments, they incur credit card processing fees, which vary in amount depending on the type of card, transaction volume and payment processor.

The three main categories of credit card processing fees are:

1.) Interchange fees: These are fees merchants pay to issuing banks to cover the costs of issuing cards and processing card transactions. Card networks set these fees.

2.) Assessment fees: These are fees merchants pay to card networks to help cover their operating costs. Card networks also set these fees.

3.) Payment processor fees: These are fees merchants pay to their payment processor (often the merchant bank or a third-party processor) for facilitating the transaction. Payment processors set these fees, which may be a flat fee per transaction, a monthly fee or a percentage of the transaction amount.

Beyond these three main fees, some payment processors charge an annual fee for maintaining payment card industry (PCI) compliance or helping the business achieve compliance.

Additionally, while not a fee, the costs associated with leasing or purchasing card readers or POS terminals are an important consideration for businesses that need to accept in-person payments. Source