How To Save Money On Your Credit Card Processing


Most businesses nowadays are capable of accepting credit card payments. Consumers love the convenience of using credit cards for purchases, whether online or offline. Business owners, however, are not too pleased with the fees that they have to pay for processing credit card payments.

It’s not easy growing and maintaining a successful business. Entrepreneurs have to keep up with the times to become competitive in the market. This includes keeping up with the trends in payments systems. Who really pays in cash nowadays? There are different ways to save money on credit card processing, but first, let’s discuss what fees are associated with credit card processing.

Credit Card Processing Fees

Business owners have to pay a fee to accept and process credit card payments, somewhere in the range of 1.7% up to 3.5% for each transaction processed. Although the fees may seem negligible, it can start adding up every time a customer pays with a credit card. There are also other fees that come with processing credit card payments aside from the transaction fees, such as monthly fees, authorization costs, assessment fees, and more.

As a business owner, you may have wondered if it is possible to reduce the fees incurred from processing card transactions. The cost of doing business has certainly gone up, and credit card transaction fees can be burning a hole in your pocket without you even knowing it.

Pricing Models for Processing Credit Card Transactions

Before you start implementing the different tips to save money on credit card processing, it is important to understand the three different processing pricing models:

  • Flat Rate: The same rate is applied to all credit card transactions, in the range of 2.5% to 3.5%. This pricing model is simple but leaves no room to negotiate better processing rates.

  • Tiered-Rate: The tiered-rate pricing is a little more complicated than the flat-rate pricing model. The processor will have bundles included in this pricing model, such as non-qualified, qualified and mid-qualified. Although the tiered-rate pricing model is somehow cheaper than the flat-rate pricing scheme, it cannot be considered the cheapest option.

  • Interchange Plus: Considered the most transparent and most affordable pricing model for credit card payment processing, many business owners have switched to interchange plus. The business owner directly pays the interchange fee instead of it going through the merchant service provider.      

How to Save Money on Processing Credit Card Payments


The truth is, there is no way to avoid the expenses incurred in processing credit card payments but by following these tips, you can save hundreds or thousands every month:

1. Go for the Interchange-Plus Model

The interchange-plus pricing model is clearly the most affordable pricing scheme. You can save a lot on fees by avoiding the flat rate or tiered-rate pricing model.

2. Negotiate with the Payment Processor

Even if you already have a service provider, you should still consider negotiating for better fees and rates. This is a good idea, especially if you are a client with good standing. The service provider may be able to reduce or even remove some fees. If your current service provider is not willing to negotiate, you can always find another service provider willing to meet your requests.

3. Avoid Leasing Equipment

Many business owners believe that leasing credit card equipment is the only way to go. The truth is, you can save a lot on fees when you purchase your own equipment, which will only set you back a couple of hundred dollars. A good site to visit is Card Switcher UK, a price comparison site specifically for credit card processing.

4. Set a Minimum Transaction Amount

One way to effectively save up on credit card processing fees is to set a minimum transaction amount for credit card payments. The customer may opt to pay in cash, which saves you from transaction fees, or they may opt to spend more at your store—a win-win situation for your business.

5. Offer Other Payment Methods

Although some may say it’s a crazy idea to add more payment processors that may charge you processing fees, it can boost the revenue of your business when you accept debit cards, gift cards, and vouchers. You can grow your customer base by having other payment methods available, which increases your overall revenue.


Understanding rates and fees associated with credit card processing can help you in negotiating better rates with service providers. Proper research and keeping up with the trends in credit card processing helps you make sound and informed decisions for your business.