How much of your card bill is the processor, and how much is the network?

Common questions

Which five numbers do I need off the statement?

Total card sales for the month, the number of card transactions, the total fees charged, roughly what share of your sales were card-present (tapped, dipped or swiped in front of you) rather than keyed or online, and the flat monthly fees — statement, PCI, gateway, batch, monthly minimum. The first three are on the summary page of every statement. The fourth you can usually estimate from how the business runs. The fifth is the one people miss, because it is printed apart from the rate summary.

Why does the tool refuse to give a single markup number?

Because it cannot see your card mix, and the card mix moves interchange by more than a percentage point. A regulated debit card, a consumer credit card and a small-business rewards card run on the same terminal cost very different amounts, and nothing on a bundled statement tells you the split. So the estimate is a band. If you take a figure to your processor, take the band and say where it came from — a precise number you cannot defend is worse in that conversation than an honest range.

What is interchange, and why can no processor discount it?

Interchange is the portion the card-issuing bank keeps, set by the card networks on published schedules that apply identically to every merchant in a category. Assessments are a smaller slice the networks themselves keep. Together they are pass-through: your processor collects them and hands them on. Nobody sells them to you cheaper, which is why a quote that undercuts a competitor is always undercutting the third component — the processor’s own markup — and why splitting the bill is the only way to see whether a quote is actually better.

Are the fixed monthly fees really markup?

In substance, yes. A statement fee, a PCI-compliance fee, a gateway fee, a batch fee and a monthly minimum are all revenue the processor keeps, and none of them fall when your rate falls. On a business doing $42,000 a month they are easy to wave off as small; at $45 a month they are $540 a year, and they are the part of a bill most often left out of a rate comparison entirely. Price them separately when you compare quotes, because a quote that wins on rate and loses on monthly fees can cost more.

My effective rate came out below the estimate. What does that mean?

That the whole bill is explained by the cheapest reading of network pass-through, so this model cannot identify markup in it. That is usually good news, and it is occasionally a sign that a fee is being billed somewhere the total you entered does not include — an equipment lease on a separate invoice, or a fee netted out of deposits rather than charged monthly. Worth a look before concluding the account is cheap.

Does a lower effective rate always mean a better deal?

No, and this is the trap flat-rate pricing depends on. Effective rate divides fees by sales, so it is driven by your average ticket as much as by your pricing. A business with a $10 average ticket and a business with a $200 average ticket paying identical processor markup will show wildly different effective rates, because the per-transaction cents are spread over very different amounts. Compare the markup figure and the per-transaction fee, not the blended rate.

Is any of this uploaded?

No. The calculation runs entirely in your browser, there are no accounts, no cookies and no analytics vendor, and there is no network request in the page at all. A saved audit stores only the numbers you typed and stays in this browser; reset deletes it. Monthly card volume is effectively your revenue, which is exactly why none of it leaves the page.

What should I actually ask my processor?

Ask for interchange-plus pricing quoted as a percentage over interchange plus a per-transaction amount, and ask for every recurring monthly fee listed by name. Then ask them to price your last statement under that quote. If they will not put the markup and the monthly fees in writing as separate line items, you cannot compare their offer to anyone else’s — which is generally the reason it is not offered that way.