How are card payment fees built?

For many merchants, card payment fees are the largest monthly payment cost after the till itself. Price lists are hard to compare because every payment provider prices slightly different parts. Once you know the parts, comparing is easy.

Four parts

A percentage by card type. Domestic consumer debit cards are the cheapest, credit cards a little more. In the EU, interchange fees on consumer cards are capped by regulation, so prices for these cards are close to each other whichever provider you choose.

Corporate and other cards. Corporate cards and cards issued outside the EU are not covered by the same cap. Their percentage can be several times the debit rate. If many of your customers are travellers or pay with a company card, this line matters a lot.

A fixed transaction fee. A few cents on every payment. It sounds small, but on a €3 coffee a three-cent fee is already one percent of the sale. The smaller the average purchase, the more the transaction fee weighs.

Monthly fees and terms. A terminal or service fee, minimum sales and a commitment period. A low percentage can turn expensive if sales fall below the minimum or you cannot leave the agreement when your business changes.

Compare with one number

Add up a month of card costs and divide by card sales. You get the effective rate: what card payments really cost on your sales. The same price list can be the cheapest for one merchant and the most expensive for another, because average purchase and card mix differ.

The card fee calculator on the pricing page does this for you. Enter a month of card sales, the average purchase and an estimate of the card mix. If you already have an agreement, enter its figures to compare.

Where to find the figures

The provider's monthly invoice or settlement report shows card sales, the number of transactions and the costs by card type. A three-month average gives a more reliable picture than a single month, especially if sales vary by season.

Check before you sign

• Commitment period and notice period
• Minimum sales and what you pay if you fall short
• Terminal rent, replacement and maintenance
• Settlement time: how fast the money reaches your account
• Notice period for price changes
• Whether the terminal connects to the till, or the amount is keyed in separately

You may not charge customers a surcharge for consumer payment cards, so card costs come out of your margin. That is why the agreement is worth reviewing whenever your sales or customers change.

Solmio and payment providers

The Solmio till works with Nets, Viva.com and Verifone terminals. The amount goes from the till to the terminal, and the payment lands on the receipt and in the reports without keying it in by hand. We help you compare the options with your own sales figures and choose the agreement that fits your business.