Understanding Your Payment Costs
- Three layers of fees. Interchange goes to the card networks, assessments go to Visa and Mastercard, markup goes to your processor.
- Only processor markup is negotiable. The networks set the rest.
- Your effective rate is total fees divided by total volume. It's the only number that matters.
- On a $50 card-present ticket, flat rate costs about 95 basis points more than a published interchange-plus band. That's $238.50 a month at $25,000 of volume. Below about a $9.23 ticket the flat rate wins instead.
- Every figure here uses one blended pass-through. That's 1.03% + $0.178 card-present and 1.50% + $0.172 online. See Cost Model Assumptions.
Several companies take a cut of every card payment, some of it fixed and some of it negotiable, and knowing which is which is the whole job.
Where Your Money Goes
Charge a customer $100 online and the fees break down like this. The interchange range is wide. It depends entirely on which card the customer hands you:
| Fee Layer | Who Gets It | On a $100 online sale | Can You Negotiate? |
|---|---|---|---|
| Interchange | Customer's bank (issuer) | $0.27 on a regulated debit card, $2.89 on a commercial card, $1.51 on this site's blended mix | No, set by Visa/Mastercard |
| Assessments | Card networks (Visa/Mastercard) | about $0.16, modelled at 0.14% + $0.02 and unverified - neither network publishes a US assessment schedule | No, set by networks |
| Processor markup | Your processor | $0.15 - $0.50 on interchange-plus, buried inside the headline rate on flat rate | Yes |
| Total | $0.58 - $3.55 across card types, $1.82 - $2.17 on the blended mix |
Interchange and assessments together are what this site calls pass-through. Every worked example below uses one figure for it. That's 1.50% + $0.172 online and 1.03% + $0.178 card-present. Where those come from, and which inputs are dials rather than published rates, is in Cost Model Assumptions.
Interchange is the biggest chunk. You can't negotiate it. You can control which interchange rate applies, though. And you can negotiate your processor's markup.
Why Different Cards Cost You Different Amounts
A basic debit card costs far less to accept than a premium rewards card. The same card also costs more online than it does in person:
| Card Type | Card-present interchange | Online interchange | Why |
|---|---|---|---|
| Regulated debit (US) | 0.05% + $0.22 | 0.05% + $0.22 | Issuer holds over $10B in assets, so the Durbin Amendment caps it |
| Exempt debit (US) | 0.80% + $0.15 | 1.65% + $0.15 | Smaller issuer, no cap applies |
| Interac debit (Canada) | ~$0.05-$0.10 flat | Separate product | Canadian debit network, flat fee per transaction |
| Consumer credit, no rewards | 1.51% + $0.10 | 1.89% + $0.10 | Plain card, nothing to fund |
| Standard rewards credit | 1.65% + $0.10 | 2.05% + $0.10 | You're funding someone's cashback |
| Premium rewards credit (Signature Preferred) | 2.10% + $0.10 | 2.50% + $0.10 | You're funding someone's airline miles and lounge access |
| Top consumer tier (Visa Infinite, MC World Elite) | 2.30% + $0.10 | 2.60% + $0.10 | The most expensive consumer card either network issues |
| Commercial / corporate | 2.26% + $0.10 | 2.79% + $0.10 | Higher limits, richer rebates to the cardholder's employer |
| Non-qualified | 3.15% + $0.10 | 3.15% + $0.10 | What you pay when a transaction fails qualification |
US figures come off Visa's published schedule dated 18 April 2026, cross-checked against Mastercard's dated 17 April 2026. Both networks publish the same number at every bound that matters, so nothing here is Visa-anchored.
Plenty of comparison content uses 1.80% + $0.10 as the average interchange for a whole business. It isn't an average. It's one card type. That card is a consumer rewards credit card. Use it as a blend and you overstate card-present cost by about 79 basis points. On $20,000 a month that's roughly $159 of cost that doesn't exist. All of it lands on the interchange-plus side of the comparison.
Every number on this page now uses one blended pass-through instead. That's 1.03% + $0.178 card-present, 1.50% + $0.172 online. See Cost Model Assumptions.
You can't tell customers what card to use. But this explains why your effective rate moves month to month. A month with more corporate card orders costs you more.
The Three Pricing Models (Know Which One You're On)
Flat rate (Square, Stripe, PayPal, Shopify Payments)
- Same rate on every transaction. Square Free is 2.6% + 15c in person and 3.3% + 30c online (squareup.com/us/en/payments/our-fees, verified 2026-08-02).
- Simple and predictable.
- You overpay on cheap cards like debit. You underpay on expensive ones like corporate.
- Best for: anyone who wants a predictable number more than the lowest number.
Interchange-plus (Helcim, Stax, most traditional processors)
- You pay actual interchange plus a published or negotiated markup. Helcim's entry band is interchange + 0.40% + 8c in person, with no monthly fee (helcim.com/pricing, verified 2026-08-02).
- Your rate varies by card type. The markup stays the same.
- Most transparent. Cheapest in 20 of the 24 channel, ticket and volume scenarios this site models.
- Best for: most merchants above roughly a $9 card-present ticket. There's no volume threshold to reach first. The exception is a card mix that runs unusually rewards-heavy.
Square Free and Helcim's entry band cost the same at one point. That point is your interchange alone averaging 2.06% + 5c. Add the 0.14% + $0.02 of network assessments this site models and it's 2.20% + 7c. Those assessments are unverified. So check which of the two your statement shows you before you compare.
On the blended card-present mix this site publishes, the two are equal at a $9.23 ticket. Above it Helcim is cheaper. Below it Square is. That single number hides a lot, though. The crossover moves with the card:
| Card the customer hands you, in person | Helcim is cheaper above |
|---|---|
| Exempt debit | $7.94 |
| Regulated debit | $8.46 |
| Consumer credit, no rewards | $9.09 |
| Standard rewards credit | $12.20 |
| Premium rewards credit | Never. Square is cheaper at every ticket |
| Commercial / corporate | Never. Square is cheaper at every ticket |
The "unusually rewards-heavy" caveat is real, and it has a shape. Add Helcim's 0.40% + 8c to the pass-through on a premium rewards card and you get 2.64% + 20c. Square's 2.6% + 15c is lower on both components. No ticket size rescues that. A debit-heavy retail mix is nowhere near the line. A B2B business running mostly commercial cards sits on the wrong side of it permanently.
That's also why the old "wait until $20K a month" rule is dead. It was built for interchange-plus products that charged a monthly fee. Helcim's entry band charges none. So the answer depends on your card mix and your average ticket, not your volume. Full method in Cost Model Assumptions.
Tiered/bundled (avoid)
- Your processor sorts transactions into "qualified", "mid-qualified" and "non-qualified" buckets.
- The qualified rate looks great in a sales pitch. Most transactions land in the pricier buckets.
- Least transparent. Almost always the most expensive.
- Best for: nobody, really.
Tiered pricing exists to make fee comparison impossible. A processor advertising a "1.69% qualified rate" can land you at a 3.5% effective rate. Most transactions get downgraded. Get an interchange-plus or flat-rate quote and compare.
Hidden Costs Most Merchants Miss
Beyond processing fees, these add up:
Chargeback fees: these vary far more than people expect, and the difference compounds. Published per-dispute costs, verified 2026-08-02. Helcim charges $0 if the case resolves in your favour and $15 if you lose. Stripe charges $15 to receive the dispute, and you never get that back. Countering costs another $15, refunded only on an outright win. A partial win still costs you $30. Braintree charges $15. PayPal charges $15 on PayPal-account and Guest Checkout disputes, or $20 on card chargebacks. The two never both apply to one dispute. Square charges $0 and says so outright. Five chargebacks a month at a $100 average ticket costs you $500 in lost sales. On top of that: $75 on Stripe or Braintree, $75 to $100 on PayPal, nothing at all on Square.
One PayPal number is worth watching. Cross a 1.5% dispute ratio with more than 100 sales in the prior three months and the $15 becomes $30. PayPal also stops waiving it on disputes you win.
Refund processing fees: most processors keep the processing fee when you refund. Refund $100 on Square's Free plan card-present rate and the $2.75 you already paid is gone. You don't get it back.
Non-compliance fees: PCI non-compliance fees are pure waste. Fill out the questionnaire and they go away. Some processors never charge a PCI fee at all. Helcim states plainly that it has no setup, PCI, cancellation or statement fees.
Reserve holds: some processors hold back a share of your deposits as a reserve. That's money you can't use. Typical reserves run 5-10% of volume, held for six months.
Currency conversion: international transactions often carry a 1% markup on top of the exchange rate.
Your First Cost Audit
Do this right now. It takes 15 minutes:
1. Pull last month's processor statement
2. Find total fees charged: $_____
3. Find total volume processed: $_____
4. Calculate effective rate: fees ÷ volume × 100 = ____%
5. Compare to benchmarks:
□ In-person: 1.8-2.3% is healthy
□ E-commerce: 2.5-3.2% is healthy
□ High-risk: 3.0-4.5% is healthy
6. If above the healthy range, identify:
□ Any junk fees (PCI non-compliance, statement fee)?
□ Are you on tiered pricing?
□ Has the rate been creeping up month-over-month?
How Much Could You Save?
Published numbers, not a round guess. The comparison is Square's Free plan card present at 2.6% + 15c against Helcim's published interchange-plus bands. The ticket is $50. Pass-through is this site's blended card-present figure, 1.03% + $0.178. Change the channel, the ticket or the card mix and the answer changes. Read Cost Model Assumptions before you lift these into a spreadsheet.
| Monthly Volume | Square Free effective | Helcim band | Helcim effective | Monthly gap | Annual |
|---|---|---|---|---|---|
| $25,000 | 2.90% | IC + 0.40% + 8c | 1.95% | $238.50 | $2,862 |
| $50,000 | 2.90% | IC + 0.35% + 7c | 1.88% | $512 | $6,144 |
| $100,000 | 2.90% | IC + 0.25% + 7c | 1.78% | $1,124 | $13,488 |
| $250,000 | 2.90% | IC + 0.25% + 7c | 1.78% | $2,810 | $33,720 |
Sources verified 2026-08-02: squareup.com/us/en/payments/our-fees, helcim.com/pricing.
The gap widens as you grow. Helcim's published bands step down automatically. Flat rate doesn't move. Even at $25,000 a month the gap is nearly $2,900 a year. That's far more than most merchants expect at that size, and it's why the 1.80% + $0.10 assumption matters so much. Run this table on that figure instead and the $25,000 row comes out at $85 a month rather than $238.50. If you've compared processors before and decided the switch wasn't worth the hassle, check which interchange number the comparison used. The real gap is two and a half to three times what the inflated assumption shows.
At a smaller ticket the picture changes rather than just shrinks. Below about $9.23 card-present, Square is the cheaper of the two at any volume. Below about a $19.53 ticket, PayPal Zettle's 9-cent fixed fee beats both. Migration is a headache. But it's a one-week headache against a recurring cost. See Processor Comparison for current rates across 50+ processors and benchmark where you stand.