Credit card processing cost: rates, fees, and your effective rate
Last updated: . Published by Avendo.
Credit card processing typically costs a business 1.5% to 3.5% of each transaction, according to NerdWallet, and the number that matters most is your own effective rate.
This page from Avendo breaks down what makes up rates for credit card processing, what pushes them up or down, and how to calculate what you really pay. Avendo’s own approach is to route each online transaction to the processor with the best available rate, and it says it does not bill merchants directly.
How much does credit card processing cost?
Most businesses pay between 1.5% and 3.5% of each card sale. Beast Insights reports the average Visa and Mastercard credit rate was 2.36% in 2025, and the Small Business Payments Alliance reports retailers pay an average of 2.3% on each credit card transaction. Your own figure depends on your card mix, sale sizes, and pricing model.
What makes up rates for credit card processing
- Interchange. Paid to the bank that issued the customer’s card. Usually the largest part of the fee, and higher on many rewards and premium cards.
- Assessments. Paid to the card networks, such as Visa and Mastercard.
- Processor markup. The processor’s own margin, either bundled into a flat rate or shown separately, as in interchange-plus pricing.
- Account fees. Monthly or one-time charges some providers add on top of per-transaction pricing.
The Small Business Payments Alliance describes the 2.3% average as split among card issuers, payment networks, and acquirers, which matches this structure.
What raises or lowers your credit card processing cost
- Volume: the U.S. Chamber of Commerce notes interchange-plus typically offers lower rates to companies processing more than $10,000 monthly.
- Ticket size: fixed per-transaction fees take a larger share of small orders.
- Card type: rewards and premium cards generally cost merchants more to accept.
- Pricing model: flat rate, interchange-plus, fee passing, or multi-processor routing.
- Monthly fees: a lower rate with a monthly fee only pays off above a certain volume.
- Processor choice per sale: Avendo routes each transaction to the best available rate among your connected processors.
Calculate your effective rate
Your effective rate is total fees divided by total card volume. Clearly Payments recommends working it out for the last 90 days before changing anything; one representative month is a good start.
How Avendo fits into your costs
Avendo says it does not bill or charge merchants directly; its compensation is handled between Avendo and the payment processors. Its homepage does not state a price, so ask the team how rates would look for your volume.
Read how Avendo is paid and what its reports show or return to the guide to the lowest credit card processing fees.
Common questions
What are the processing fees for credit card payments?
Credit card processing fees typically cost a business 1.5% to 3.5% of each transaction, according to NerdWallet’s 2026 guide. The total combines interchange paid to the card-issuing bank, assessments paid to the card networks, and the processor’s markup. Your actual cost depends on card type, sale size, and your pricing model.
What is the average credit card processing fee in 2026?
The most recent full-year figure is 2.36%. Beast Insights reports that the average Visa and Mastercard credit rate in 2025 was 2.36%, in a year when US merchants paid a record $198.25 billion in card fees. The Small Business Payments Alliance separately reports that retailers pay an average of 2.3% per credit card transaction.
What is an effective rate?
Your effective rate is total processing fees divided by total card volume over the same period. It is the one number that lets you compare quotes fairly, because it captures percentages, per-transaction fees, and monthly charges together. Clearly Payments recommends computing it for the last 90 days before changing anything. The calculator on our cost page does the math.
How much can a small cut in my processing rate save?
Small rate changes add up quickly at volume. Clearly Payments shows that a business with $1,000,000 a year in card volume saves $2,000 per year by cutting its effective rate by 0.20%. Homebase’s worked example for a business processing $20,000 a month arrives at $960 saved annually. Your result depends on your own volume and current rate.
How much do banks charge businesses for card transactions?
The card-issuing bank’s share, called interchange, is the largest piece of most card fees. The Small Business Payments Alliance reports that retailers pay an average of 2.3% on each credit card transaction, split among card issuers, payment networks, and acquirers. NerdWallet puts total processing fees at 1.5% to 3.5% of each transaction.
What is the difference between flat-rate and interchange-plus pricing?
Flat-rate pricing bundles every cost into one set amount, while interchange-plus passes through the card network costs and adds a consistent markup. NerdWallet gives 2.6% plus 10 cents as a flat-rate example and 0.4% plus 8 cents as an interchange-plus markup example. Neither model routes payments across several processors the way Avendo does.
Keep reading
- Guide to the lowest credit card processing fees
The main guide to lowering card fees with multi-processor routing.
- Pricing clarity: how Avendo is paid
How Avendo is compensated and what its reports show.
- Credit card processing statistics for 2026
Published industry figures on card fees, each with its source.
Ask Avendo what routing would mean for your store
Tell the Avendo team about your checkout, your monthly card volume, and what you pay today. Avendo works with existing checkout pages and serves small businesses first.