The actual costs to process each type of credit card is public knowledge and as per the Code of Conduct for the Credit and Debit Card Industry (Canada) they must be posted online by the networks Visa & MasterCard. These fees make up the majority of the cost of processing credit card transactions. These fees do not include operating costs. These fees are affected by a number of factors:
- Any “card not present” transactions increase these fees (keyed, online, phoned etc.)
- If you deal business to business and accept a lot of business, purchasing or corporate card the costs are higher
- If you deal with a lot of higher income customers you may see more premium cards than average increasing costs.
- Certain industries receive a lower Interchange rate like grocery stores and gas stations.
- Visa and MasterCard have special programs for some small businesses lowering their interchange rates and thus processors costs.
- Recurring payment have a lower interchange rate than other transactions even face to face, for example monthly membership fees billed through an online account to automatically charge a customer on a regular date for a specific amount.
- Tier 1 and Tier 2 businesses (high volume) get lower interchange rates.
We have produced a chart showing the percentage of each card type accepted by our clients who deal with the general public face to face along with the cost of each per $10,000 in sales. Click Here Sales by Card Type