Credit Card Processing Fee Calculator

Are you concerned about excessive credit card processing fees? And wondering what qualifies as a reasonable rate? Try out our Calculator to assess if you're potentially overpaying. Monthly processing statements can be quite extensive, making it challenging to know your actual processing expenses.


With our Calculator, you can discover your authentic processing rate. We'll assist you in identifying any potential overpayments and suggest ways to reduce your costs.

Credit Card Processing Fee Calculator

Credit Card Processing Fee Calculator

Your effective processing rate represents the actual rate you pay after factoring in all processing expenses, such as interchange fees, processor markups, and any monthly service fees. It reflects the genuine percentage you incur for each credit card transaction.


To get your processing rate, review your previous monthly statement. You'll require two figures:


  • Total fees for processing incurred
  • The overall amount you processed


Then, simply make use of our Calculator to determine your accurate credit processing rate.

Understanding Credit Card Processing Fees

Processing fees for credit cards, often referred to as the Merchant Discount Rate, is basically a combination of assessment fees, markup, and interchange fees from merchant services. When accepting card payments, you'll typically need tools for payment processing for payment gateway or physical cards for virtual shopping carts.


The payment processor determines your fees, which might include:


  • Fees per-transaction 
  • Monthly service charges
  • Monthly service charges for transaction equipment

Assessment Fees

The average assessment fees for key networks are approximately 0.14%. Here are the assessment fees for different payment processors:


  • Visa: 0.14%
  • MasterCard Credit Cards: 0.1375% (Transactions less than $1,000); and (0.01% Transactions up to or more than $1,000)
  • Discover: 0.13%
  • American Express: 0.15%

Interchange Fees

The issuing bank of credit cards obtains interchange fees for each transaction, such as Capital One for a Visa card. These fees are revised biannually and generally range from 1.5% – 3.3%.

Processor Markup

This refers to your merchant account provider's commission, ideally constituting only 10 - 15% of your total processing rate. A high markup often contributes to an excessive effective rate, prompting the need to negotiate for reduced rates.

What Is an "Effective Rate" for Processing Fees?

For most businesses, a favorable effective rate typically falls between 2.5% and 3.5%. However, in certain business sectors, a rate as high as 4% could still be considered reasonable.

How To Calculate Credit Card Processing Fees?

Determining your exact charges for credit cards may be tricky if you are facing interchange-plus rates or are being charged extra on a monthly basis. To assess credit card processing fees accurately, the most effective method is to ascertain the effective rate.


To calculate the effective rate, divide the total processing deductions by the overall monthly sales. The resulting figure represents your effective rate, indicating the total sum your credit card company charges for facilitating credit card transactions.

Different Charges by Card Issuer

When you take credit cards, you'll encounter the following charges. These fees remain constant across payment processors and are mandatory for every processor. Here are some charges:


  • Acquirer Processing: Applied to all the card transactions in the US.
  • Fixed Network: A standard fee across all brands of cards, determined by the absence or presence of a card during the locations, the transaction, and the transaction capacity.
  • Kilobyte Access: Per-transaction fee for settlement after authorization.
  • NABU: The Card processor, Mastercard, imposes these charges for refunded or settled debit and credit card transactions.

How to Reduce Your Processing Rate?

A rate exceeding 3.25% is generally considered more than average. If you're not with Host Merchant Services, your first step is to give us a call or fill out a contact form. Keep in mind that interchange rates and assessment fees are non-negotiable. However, you can discuss any aspect over which the provider has control, which includes:


  • Markup Fees
  • Monthly or annual fees
  • Fees for virtual terminal 
  • Expenses related to equipment and setup 


Trimming these fees can significantly lower your effective processing rate. Ideally, it would be best if you aimed to keep your provider fees under 20% of your total processing costs. Effective negotiation hinges on being a valuable client. The more sales you generate, the stronger your negotiation position becomes.


Maintaining a positive payment history is also crucial. Timely payments and fewer chargebacks make you an attractive client, increasing the likelihood of your provider cooperating in fee reduction efforts.


Understanding your effective processing rate is the initial step in assessing whether you're paying more than necessary.


If your processing charges appear excessively high, it's time to switch to Host Merchant Services. When comparing rates across different providers, ensure that you're evaluating the overall effective rate rather than focusing solely on individual fees.

To determine processing fees for credit cards, it's advisable to find the effective rate. This may be calculated by dividing the entire amount of processing fees by the overall amount of sales for the month. The resulting figure represents your processing charges.

Generally, the average processing fees for credit cards vary from 1.5 percent to 3.5 percent per transaction, although the exact percentage is contingent on many factors.

Generally the highest interchange category is 3.25%, however the actual effective rate for merchants has no cap. Additionally, there are restrictions on credit card surcharges, and merchants cannot impose charges exceeding 3% for Visa and 3.5% for other card brands on each transaction.

The merchant is typically responsible for covering the fee for processing payments. In certain instances, businesses transfer these charges to consumers through surcharges to avoid incurring additional costs themselves.

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