Every card sale gives up a small slice to the cost of processing — but that slice is not one fee, and not all of it is your provider’s to keep. Here is what a processing fee is made of, the pricing models you will be quoted, and how to read your statement.
When a customer pays with a card, a small percentage of the sale covers the cost of processing. It is tempting to think of that as a single fee your provider charges — but it is really three separate pieces, and only one of them belongs to your processor:
The key takeaway: most of what you pay is pass-through cost that every provider faces. The part worth comparing is the markup — and the pricing model is what determines how clearly you can see it.
Providers package those three cost pieces into a pricing model. A small business will typically be offered one of three, each with its own trade-offs:
No single model is right for every business. What matters is understanding which one you are being quoted, so you can compare offers on the same terms.
Each month your provider sends a processing statement. It can look dense, but you are really looking for a few things:
One honest caveat: exact fee amounts vary by provider, by card type, and by the nature of a business, so there is no universal number to expect. For that reason RMO does not publish a single processing rate. RMO Merchant Services is RMO’s division for card acceptance and can review a statement with you and explain how these models apply to your business.
A processing fee splits into three parts. Interchange is the largest part, set by the card networks and paid to the card-issuing bank. Assessments are paid to the card networks themselves. The processor’s markup is the remaining part — the piece that the processor keeps and the part that varies between providers.
Small businesses usually see three pricing models. Interchange-plus passes through the true interchange and assessments and adds a clearly stated markup. Flat-rate charges one simple percentage for every sale. Tiered pricing sorts transactions into qualified, mid-qualified, and non-qualified buckets with different rates for each.
Interchange-plus is generally the most transparent because it separates the processor’s markup from the underlying network costs, so you can see exactly what your provider charges. Flat-rate is the simplest to predict, while tiered pricing can be the hardest to compare because the bucket rules are not always obvious.
Exact fee amounts vary by provider, card type, and the nature of a business, so a single published rate would not be meaningful. RMO Merchant Services is RMO’s division for card acceptance and can review your situation and explain how the pricing models apply to it.
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