Over the past couple of decades, the amount of transactions that are completed using credit cards has increased dramatically. With online shopping continuing to outpace traditional forms of shopping, the use of credit cards is likely to only continue to rise. While these forms of cards provide great conveniences to shoppers, and ultimately result in increased sales for businesses and retailers, many businesses are struggling due to the high credit card processing charges that come with a merchant account transaction.

Who’s Being Charged for What?

Whenever a consumer uses a credit card to make a purchase, they will be charged for the exact dollar amount of the transaction, plus any applicable sales taxes that are paid. The business, on the other hand, will have to pay credit-processing fees to the credit card company. The fees that are paid are generally around two percent of the sale price, plus a low flat fee of around 15 cents per transaction. While this may seem like a nominal amount, these fees can add up to large sums of money over time.

Tip: Shop Around

While these commissions paid on merchant account transactions are inevitable, there are ways that a business can control how much they have to pay on them. One of the best ways to save money on the credit processing fees paid would be to shop around for rates. Most businesses end up using the first offer that they are given without considering whether the rate is too high. By shopping around with various credit card processing companies like Merchant Warehouse and iTransact, you will receive a number of different quotes. These quotes can then be used to negotiate against one another, which could help you receive an even lower rate.

Another tip to for not paying too much credit processing fees would be to attempt to reduce the amount of credit card transactions that you receive. While offering credit card purchases to consumers is a great convenience, there are ways that you could entice consumers to pay with cash or debit cards instead. One way to do this would be to offer some form of a rewards program for cash purchases. If you provide future discounts to cash-paying consumers, you will not only avoid some credit card processing fees, but you will help ensure that you will receive a repeat customer in the future.

Best Merchant Account Credit Card Services in 2025