How to read your card processing statement

Card processing statements are famously hard to read. That is not always an accident. The good news is you only need to understand a handful of lines to know whether you are paying a fair price.

The one number that matters

Before anything else, work out your effective rate. Add up every fee on the statement for the month, then divide it by the total value of card payments you took that month.

For example, if you took £100,000 on card and paid £1,600 in fees in total, your effective rate is 1.6%. That is the number to compare, not the headline rate in your contract. The two are often quite different.

The main fees, in plain English

• Interchange. Paid to the bank that issued your customer’s card. It is set by the card schemes and varies by card type: debit or credit, personal or business, UK or overseas. In the UK, interchange on everyday consumer cards is capped, at 0.2% for debit and 0.3% for credit.
• Scheme fees. Charged by Visa and Mastercard for using their networks. Usually small, but there are a lot of them.
• Acquirer margin. What your acquirer charges on top. This is the part that is genuinely up for negotiation.
• Merchant service charge (MSC). On a blended plan, this is one rate that bundles all of the above together.
• Authorisation or transaction fees. A fixed charge per payment, such as a few pence. These matter a lot if your average sale is small.
• Other charges. Watch for terminal rental, PCI compliance fees, minimum monthly charges, statement fees and chargeback fees. They add up.

Red flags to look for

• Your effective rate is well above the rate you were quoted
• A PCI non-compliance fee every month, which you can usually stop by completing a short questionnaire
• Minimum monthly charges you never get near
• Terminal rental for machines you no longer use
• Fees that change month to month with no obvious reason

Blended or Interchange++?

If your statement shows one rate for most payments, you are on a blended plan. If it lists interchange and scheme fees separately, you are on Interchange++. Neither is automatically better. We explain the difference in our guide to Interchange++ and blended pricing.

Want a second pair of eyes?

Send us your last few months of statements. We will work out your effective rate, explain every line, and tell you honestly whether you could be paying less. It is free and there is no obligation.