Credit card processing fees: what you pay and how to lower them
Credit card processing fees are what you pay every time a customer pays by card. This page explains interchange, assessments, processor markup, and junk fees in plain English. Clearo uses interchange-plus so you can see the real cost plus our fixed margin.
Short answer
Credit card processing fees are what a business pays to accept a card sale: interchange to the card's issuing bank, network fees to card brands such as Visa and Mastercard, and the processor's markup, plus any account fees on your statement. Your effective rate, total fees divided by card sales, is the number to compare.
We do not publish one-size-fits-all dollar rates here. Your fee depends on industry, average ticket, monthly volume, card mix, and card-present vs keyed. For a live quote, send a statement for a free review or request custom pricing on pricing.
What credit card processing fees are
Credit card processing fees are the total cost of accepting a card payment. They usually include:
Interchange Paid to the customer's issuing bank. Set by card networks; varies by card type, how the card is entered, and merchant category.
Network assessments Paid to Visa, Mastercard, and other networks.
Processor markup Paid to your payment company.
Extra fees Statement fees, PCI fees, batch fees, monthly minimums, early termination fees, and other "regulatory" or "compliance" line items that may or may not map to real services.
You don't pay any of this to Visa or Mastercard directly. Per Visa, what a merchant actually pays is a "merchant discount" to its own financial institution (Visa), and Mastercard counts interchange as one of many costs inside that rate, saying it plays no part in how acquirers price merchants (Mastercard).
Watch for fees that change after you sign, too. The FTC's 2022 complaint against First American Payment Systems alleged that its savings pitches left out the price increases it went on to apply to existing customers (FTC), so ask how and when your rates can change.
Effective rate explained
Your effective rate is total fees divided by total volume. Most owners do not know that number. It is the first thing we calculate in a free statement review.
Say a month's statement shows $1,180 in total fees on $52,000 of card sales. The effective rate is 1,180 ÷ 52,000 = 2.27%. Compare that one number, not the advertised rate, when you weigh a quote. Our effective rate calculator does the math from one month's fees and sales, and shows what each 0.10% of rate costs you in a year.
For how to read the line items yourself, see how to read a merchant statement. For the model Clearo uses, see pricing and interchange-plus vs flat-rate.
Why fees differ
- •Card-present vs keyed (chip/tap usually costs less than phone-keyed or manually entered)
- •Card type (debit vs credit vs rewards)
- •Industry / merchant category
- •Ticket size and volume
- •Pricing model (flat-rate, tiered, or interchange-plus)
The gaps are real money. On Visa's US schedule with rates effective April 18, 2026, a standard consumer credit card carries 1.51% + $0.10 when it's dipped or tapped and 1.89% + $0.10 when the card isn't present (Visa). Debit cards from big banks cost less again: for a bank with $10 billion or more in assets, the Federal Reserve's Regulation II caps debit interchange at 21 cents plus 0.05% of the sale, plus a 1 cent fraud-prevention adjustment (Federal Reserve). On a $100 sale, that's 27 cents, against $1.61 for the credit card tapped.
Flat-rate is easy to read, but as volume grows it can cost more than interchange-plus, depending on your card mix. Tiered hides cost in mid and non-qualified buckets. Interchange-plus passes through real network cost and adds a clear markup. To test a flat-rate quote against interchange-plus on your own volume, use our flat rate vs interchange-plus calculator.
Home-services example: jobsite vs phone-keyed
An HVAC or plumbing crew that takes card-present payment on a mobile reader at the job site usually sees different fee outcomes than the same ticket keyed later over the phone on a virtual terminal.
Jobsite card-present tends to avoid preventable downgrades when authorization data is complete and batched on time. Phone-keyed repairs and deposits are still useful for remote customers, but they often cost more per transaction. Pair mobile for field close-out with virtual terminal for phone work, then audit both paths in a free statement review.
How to lower fees
- Move from flat-rate or tiered to interchange-plus when volume supports it
- Prefer card-present (chip/tap) over keyed entry when possible
- Batch on time and keep authorization data clean
- Remove junk fees that do not buy a real service
- Right-size hardware and gateway so you are not paying for unused software
- Ask about surcharging where legal, to offset credit card cost (debit and prepaid excluded)
- Get a free statement review, so any comparison uses your own card mix instead of a generic pitch
A free statement review is where we start: we work out your effective rate, mark each fee, and show what the same volume would cost on interchange-plus pricing. Whether it costs less depends on your volume and card mix.
Also see how to reduce credit card processing fees and hidden fees.
US vs Canada note
Fee building blocks are similar in the US and Canada, with market-specific card products and rules. Clearo supports merchants in both countries.
Canada adds two things worth knowing. Its Code of Conduct for the Payment Card Industry requires a statement at least once a month that lists interchange, network fees and every other fee, with your effective merchant discount rate for each card type (FCAC). And qualifying small businesses have paid lower credit card interchange since October 19, 2024, under the federal government's agreements with Visa and Mastercard (Finance Canada).
The terminals Clearo supplies accept Interac, Visa, Mastercard, Apple Pay, and Google Pay. Surcharging and other program rules can differ by country and state; we keep that high-level here and confirm details with your rep. For a Canada-specific quote, upload a Canadian merchant statement to the free statement review.
Get your free statement review
Upload a PDF, photo, or screenshot of your latest statement. We'll send a plain-English breakdown of what you pay now and what the same volume would cost with Clearo. No charge and no obligation.
FAQ
Interchange, network assessments, processor markup, and any extra account or "junk" fees on your statement.
Total fees divided by total volume. It is the single most useful number for comparing processors. We calculate it from your statement in a free review.
Improve pricing model (often interchange-plus), reduce downgrades, remove unnecessary fees, optimize card-present vs keyed mix, and consider compliant surcharging where allowed. Start with a free statement review for numbers based on your volume.
Often yes, because keyed and card-not-present transactions can carry higher interchange and more downgrade risk. Use virtual terminal when the phone or remote workflow requires it, and prefer chip/tap in the field when you can.
Go to the free statement review page and upload a recent statement as a PDF, photo or screenshot. We send back a breakdown of what you pay now, fee by fee, and what the same volume would cost with Clearo.
Sources
The Visa, Mastercard, Federal Reserve, FTC, FCAC and Finance Canada pages behind the fee facts on this page, checked in October 2026. Rates change, so confirm current figures with each source.
- Credit Card Processing Fees & Interchange Rates (Visa) (usa.visa.com)
- Mastercard Interchange Fees and Rates Explained (mastercard.com)
- FTC Takes Action to Stop Payment Processor First American from Trapping Small Businesses with Surprise Exit Fees and Zombie Charges (ftc.gov)
- Visa USA Interchange Reimbursement Fees (rates effective April 18, 2026) (usa.visa.com)
- Regulation II, Interchange Fee Standards (Federal Reserve) (federalreserve.gov)
- Code of Conduct for the Payment Card Industry in Canada (FCAC) (canada.ca)
- Government reduces credit card fees by 27 per cent for small business owners (Department of Finance Canada) (canada.ca)
See how we compare
Side-by-side comparisons that link each company's own pricing page.
Disclaimer: general information, not professional advice
This page is general educational information, not legal, tax, accounting or financial advice. Rules and rates vary by place and change, so confirm them with the official source and a qualified professional before you act. Full terms are in our Terms of Service.
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