What Your Shop Pays on a Visa Credit Card Sale
A customer taps a Visa card and some of that money never reaches you. Here is who takes what, and what each processor's own page says it charges.
A customer hands you a Visa credit card. The sale goes through, and part of that money never reaches your bank. Visa credit card processing fees are the slice taken from that sale. Some of it you negotiate. Some of it never touches you at all. Here is how the pieces fit, in plain words.
Who pays what on a Visa sale
Visa's own page draws a clean line between two fees that people often mix up. The first is the interchange reimbursement fee. Visa says these are transfer fees between acquiring banks and issuing banks for each Visa card transaction. Visa says merchants do not pay interchange reimbursement fees. That money moves between the banks, not out of your account.
What you pay is called the merchant discount. Visa says merchants negotiate and pay a merchant discount to their financial institution. So when you haggle over your rate, you are not haggling with Visa. Visa says you negotiate it with your financial institution. Visa's page also says banks may bundle processing services into the merchant discount rate.
The fee types on Authorize.net's pricing page
Authorize.net's pricing page lays out the kinds of charges it applies. Percentage-based fees are applied to each transaction according to the card type used. Fixed per-transaction fees are added to every authorization regardless of amount. Monthly service or gateway fees are used for payment gateway access and account maintenance. Authorize.net's pricing page also says international surcharges are added for cards issued outside the business's home country.
What each processor's page says
Each company publishes its own card rates. Here is what each says, taken from its own pricing page.
Stripe's pricing page says its standard online rate is 2.9% + 30¢ per successful transaction for domestic cards. In person, card payments cost 2.7% + 5¢ per successful transaction for domestic cards.
Square's pricing page says in-person card payments run from 2.6% + 15¢ to 2.4% + 15¢, depending on the plan. Its online and invoice card payments run from 3.3% + 30¢ to 2.9% + 30¢, depending on the plan. Square's pricing page also says Visa, Mastercard, American Express, and Discover all carry the same processing fees.
PayPal's fee page says standard credit and debit card payments cost 2.99% plus a fixed fee. That fixed fee for commercial transactions received in US dollars is 0.49 USD.
Shopify's pricing page says the Basic plan is $29 a month and card rates start at 2.9% + 30¢ USD. The Grow plan is $89 a month and card rates start at 2.7% + 30¢ USD. The Advanced plan is $359 a month and card rates start at 2.5% + 30¢ USD.
Authorize.net's page says the credit card transaction fee is $0.10 and applies to charges, refunds, voids and declines. Its credit card discount rate is 0.00%. The gateway monthly fee is $25.00 and is prorated if the service is set up mid-month.
The same card, taken three ways
How you take the Visa card changes the price. The same plastic costs different amounts depending on whether it is tapped, typed, or keyed in from a phone call.
Stripe's pricing page says manually entered cards add 0.5% to the online card rate. Square's pricing page says manual entry or card on file payments cost 3.5% + 15¢. PayPal's fee page says PayPal Point of Sale card present transactions cost 2.29% + 0.09 USD. PayPal's fee page says PayPal Point of Sale manual card entry transactions cost 3.49% + 0.09 USD. Shopify's pricing page lists in-person card rates of 2.6% + 10¢ and in-person manual rates of 3.5% + 10¢.
If half your orders arrive by phone, the keyed-in rate matters more to you than the counter rate. A shop that mostly taps cards in person should look at the in-person line first. On the Stripe, Square, PayPal and Shopify pages above, a typed card number carries a higher rate than a card read in person.
Foreign cards cost more
Cross-border lines appear on several of these sheets. Stripe's pricing page says international cards add 1.5% and currency conversion adds 1%. PayPal's fee page says international commercial transactions add a 1.50% fee. Square's pricing page says an additional fee applies to payments made on credit or debit cards issued outside of the United States. If you sell to travelers or ship abroad, read those lines before you pick a plan.
Monthly fees, setup fees, and contracts
The per-sale cut is only half the bill. Some of these pages also list monthly or setup fees.
Stripe's pricing page says its standard plan has no setup fees, monthly fees, or hidden fees. Square's pricing page says its plans start at no cost and have no hidden fees or locked-in contracts. The monthly fee per location is $0, $49 or $149, and Square Plus and Square Premium charge it per location. Shopify's pricing page says there are no setup fees on any plan. The plans still carry the monthly prices listed above. Authorize.net's pricing page says it charges no setup fees and no early termination fees. There is no contract. You can cancel your gateway subscription at any time without penalty. Authorize.net's page says the gateway setup fee is $0.00.
PayPal's fee page says the monthly fee is no fee for Advanced Credit and Debit Card Payments and ACH Services.
Refunds and declines
Stripe's pricing page says that, outside the payment methods it names, there are no fees for issuing refunds. But the processing, Connect and currency conversion fees from the original sale are not returned. Authorize.net's page says its $0.10 credit card transaction fee applies to charges, refunds, voids and declines. So a declined card can still cost a dime on that gateway. And a refund may not give back what you paid to take the money.
What to confirm before you sign
Published prices change. Every rate above came from the company's own page. Any company can change those numbers. Before you sign up, open the processor's pricing page and check three things. First, the rate for how you actually take cards, whether that is online, in person, or keyed in. Second, the monthly fee, if any, and whether it is charged per location. Third, what happens on a refund.
Then run your own numbers. Pull last month's sales and apply each rate to your real tickets. A shop whose typical sale is small notices the flat per-transaction fee more than the percentage. A shop with large tickets feels the percentage more. To see one sale priced across several sheets, a forty dollar sale at the counter walks through the math. And if you ever pay extra to get your money faster, paying to be paid tonight covers what that speed costs.
Authorize.net's pricing page notes one more thing worth checking. A merchant account applied for through its All-in-one plan may have separate terms. You can review them at signup. Wherever you sign up, read the terms on that day, not on the day you found this article.