Cost Reduction

Getting Smart with Processing Fees: What You Do and Don’t Have to Pay

For a lot of restaurant owners, credit card processing is one of those necessary evils. You know your guests want to pay with plastic, you know you need to accept it, but it never seems like an easy process. It’s already bad enough without having to worry about what you should and should not be paying every month. Most providers charge unnecessarily high fees for things that don’t actually cost them any money to provide. These are simply to make a larger profit, banking on the fact that you won’t question the charge among all of the other confusing line-items.

Your restaurant can’t afford to be spending money on these unnecessary fees. At the core, there are three main ways fees can be broken up – required, recurring, and one-off. Here’s a breakdown of what to expect on your statement, and how to avoid paying more than you need to for something as essential as getting paid.


Transactional Fees (Required)

These are fees that are associated with each transaction you run at your business. They are broken down into interchange and cents per transaction.

These come directly from the credit card companies and are considered the “pay-to-play” cost for accepting credit cards at your restaurant. They are typically non-negotiable and every restaurant owner must pay them.

Interchange rates vary based on the type of credit card you are accepting. The more expensive it is for the credit card company to maintain the card with things like rewards, cash back, and other perks, the more expensive the interchange. This means that debit cards are usually the lowest and corporate credit cards the most expensive.

Card Type


Cents / Transaction











Recurring Fees

Every payment processing company wants to make a profit – it’s how they do it that should matter to you as a restaurant owner. A lot of them apply a markup to each of your transactions, which means the more volume you process that month, the more you pay. Others offer subscription style services, like Fattmerchant, allowing merchants to process without a cap for a flat monthly subscription.

Most providers make a lot of money by not only adding a percentage on top of interchange, but adding recurring fees on your monthly statement as well. These fees are typically pure profit, as it doesn’t actually cost the processor anything in order to offer the services that the fee is allegedly for.

Keep an eye out for these fees on your next statement and you could save hundreds of dollars on your next bill!

  • Monthly Minimum Fee
  • Statement Fee
  • Batch Fee
  • Next Day Funding Fee
  • Annual Fee
  • IRS Report Fee
  • …and so many more!


One-Off Fees

Believe it or not there’s at least one more way providers skillfully add line items to your monthly statement, and that’s through one-off fees. Some fees might not be on every single statement, but rather triggered by individual actions. Keep an eye out for:

  • Terminal Fees
  • Setup Fees
  • Early Termination Fees
  • Reprogramming Fees
  • PCI Compliance Fees
  • Address Verification Fees
  • Chargeback and Retrieval Fees
  • Payment Gateway Fees
  • … and so many more!

Needless to say, that can all really add up!! Merchant services providers make huge profits on the fact that the average business owner is not aware of what they are paying and why. There’s no room for that kind of thing in the restaurant industry, so keeping an eye on your statement and partnering with a provider that minimizes those fees is very important.



Cost Reduction
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