Payment Processing 101

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Understanding Your Credit Card Fees

The evolving world of payment processing may seem complicated, but it doesn’t have to be. Arm yourself with the fundamental knowledge—and leverage it to improve your business.

The Breakdown of Each Fee

(The breakdown below reflects industry standards.)


  • 0%

What It Is

The amount paid to the card issuer (i.e. Chase Bank, PNC Bank) as compensation for expenses incurred in providing lines of credit to cardholders.

What It Pays For

Cardholder line of credit (including risk), cardholder statements, detailed reporting, rewards benefits.


  • 0%

What It Is

Flat amount paid to the credit card associations (i.e. Visa, Mastercard, Discover or American Express).

What It Pays For

Network infrastructure, establishment/maintenance of rules and pricing, research and development, marketing and branding.

Processor Fee

  • 0%

What It Is

The fee paid to the financial organization (i.e. i3 Commerce Technology) that handles the transaction.

What It Pays For

Communication costs, customer support, technical support, equipment downloads, risk/underwriting, statements/billing, product development, other overhead expenses.

Influence Your Fees Through Interchange

In an industry that’s blanketed with inconsistencies, it’s hard to know what factors
influence your interchange rate.

(Interchange makes up the majority of your credit card processing costs.)

Several factors determine what interchange rate a transaction qualifies for:

  • Card Type
  • Transaction Amount
  • Industry Type
  • Line Item Details
  • Processing Environment
  • Additional Processing Data

Contact i3 Commerce Technology for a Free Rate Review

Our payment processing advisors use best practices to earn our merchants optimal savings.

It’s one reason we rank in the top 5% in our industry for highest customer retention.