Pricing
There is no headline rate on this site.
A quoted rate is not a price. The price is the effective rate: all fees divided by volume. That is the number to compare, and it is the number the instrument below calculates from your statement.
What you are paying now
Start with your own statement.
What you pay now
Your figures · not a quote
$25,000 — $5,000,000
2,083 transactions a month
Your assumption — reserve terms are set at underwriting
Take the rate and per-transaction fee from your last statement. Most merchants find their real effective rate is higher than the one they were quoted, because the quoted rate excludes the per-transaction fee and any monthly charges.
Gross card volume
Discount
3.50% of volume
Transaction fees
2,083 × $0.30
Net to your bank
Before monthly account and gateway fees
- Effective rate
- 3.75%All-in, on volume
- Cost per year
- $112,500Discount plus transaction fees
- Cost per transaction
- $4.50Blended, all-in
- Each 0.10% is worth
- $3,000Per year, at this volume
The components
What makes up the number.
| Component | Set by | Negotiable | What it is |
|---|---|---|---|
| Interchange | Card networks | No | The largest component and the one nobody can discount. Set by Visa, Mastercard, Amex and Discover, and varies by card type, entry method and the data you pass. Level II and III data can move qualifying B2B transactions into lower categories — that is the only lever here, and it is a data lever, not a negotiation. |
| Assessments | Card networks | No | Network fees on top of interchange. Small, fixed, and identical for everyone. Any processor presenting these as part of their own margin is misrepresenting the statement. |
| Acquirer markup | Acquiring bank | Somewhat | What the bank charges for carrying your liability. This is where restricted-vertical pricing actually differs from standard risk, and it moves with your ratio, history and vertical rather than with how hard you push. |
| Per-transaction fee | Acquirer and gateway | Somewhat | A flat amount per authorisation. Its weight depends entirely on your average ticket — at a $30 ticket it can exceed the discount rate, and at a $900 ticket it is a rounding error. Merchants comparing quotes on discount rate alone routinely pick the more expensive one. |
| Gateway and account fees | Gateway, ISO | Yes | Monthly gateway access, statement fees, batch fees, PCI fees. Individually small, collectively the difference between a quoted rate and a real effective rate. |
| Ancillary services | Vendors | Yes | Chargeback alerts, account updater, fraud scoring, brand registrations in programmed verticals. Real costs attached to real services, and each should appear as its own line rather than being folded into a rate. |
What moves it
What moves your rate, in rough order of weight.
- Vertical and MCC
- Largest single driver of the acquirer markup
- Chargeback ratio
- Moves markup and reserve terms in both directions
- Processing history
- Twelve clean months is worth more than any negotiation
- Monthly volume
- Improves pricing, and raises the cap you need
- Average ticket
- Decides whether the per-transaction fee or the rate dominates
- Delivery window
- Drives reserve rate and term more than it drives rate
- Billing model
- Continuity and trials price differently from straight sale
- Card mix
- Commercial, international and premium cards carry higher interchange
How to read a quote
The questions that expose a bad one.
What is the effective rate, not the discount rate?
All fees, including per-transaction, monthly, batch, statement and PCI, divided by volume. A 2.9% quote with $0.35 per transaction on a $28 average ticket is not 2.9%.
What is the reserve rate and term, in writing?
A quote without reserve terms is not a quote. The reserve determines your working capital position for the first several months of the account.
What is the monthly volume cap?
And what happens when you exceed it. A cap set at your current volume rather than your forecast will produce a hold in your best month.
What does the termination clause say?
Term length, early termination fee, notice period and what triggers termination for cause. It is the most informative paragraph in any merchant agreement and the least read.
Questions
On pricing and terms.
Reserve mechanics — the part of pricing that is not a fee — are explained in full on rolling reserves.
Send us your statement.
We will work out your real effective rate, show you where it is going, and tell you honestly whether we can improve on it. Sometimes the answer is that you already have a good deal.