- Transaction fees are the costs that businesses pay to the service provider each time a customer payment is processed electronically.
- Transaction fees may vary depending on the service provider, but are typically between 0.5% and 5% plus certain fixed fees.
- Merchants work with merchant acquiring banks to set up an electronic payment process and an escrow account for funds.
- The transaction fee usually consists of an acquirer fee and a processor fee.
- American Express, Visa, MasterCard, and Discover charge roughly the same fees with slight differences that add up to cents in some components.
- In the seller’s statement, the fee is usually divided into exchange, tiered and subscription.