Not every processing fee is negotiable. Understanding the difference can help operators focus on costs they can control.

Why it matters: Many businesses spend time negotiating fees that are fixed while overlooking the charges that processors have the flexibility to adjust.

Most processing fees fall into two categories:

• Fixed costs: Interchange and assessment fees are paid to card networks and issuing banks. These expenses are generally non-negotiable and often account for the largest share of processing costs.
• Processor fees: These are the charges retained by your payment processor and are often open to negotiation.

Fees Worth Reviewing

• Processor markup: This is the primary fee your processor controls. Ask for an interchange-plus pricing model and compare quotes from multiple providers.
• Monthly statement and account fees: Statement, service and account maintenance fees may be negotiable or removable. Review each charge and ask your provider for an explanation.
• PCI compliance fees: These fees may be negotiable. Completing compliance requirements can also help avoid noncompliance penalties.
• Monthly minimums: If transaction volume fluctuates, ask whether minimum processing requirements can be reduced or eliminated.
• Batch and gateway fees: Small recurring charges add up over time and may be reduced during negotiations.
• Regulatory and network access fees: Review these line items and carefully ask for clarification on any charges that are unclear.
• Equipment leases and termination fees: Before signing with a provider, understand the terms and explore whether fees can be adjusted or eliminated.

The bottom line: Focus your attention on fees your processor controls. Those are typically the charges with the greatest opportunity for negotiation.

Sources

1. https://www.uschamber.com/co/run/finance/calculate-credit-card-fees
2. https://www.pcisecuritystandards.org/merchants/
3. https://www.federalreserve.gov/paymentsystems/regii-about.htm