Processing Pricing Questions

What this category covers

This category covers interchange-plus against tiered and flat rate, how to calculate a true effective rate, and what markup is reasonable. The answers are written to give you the structure of the decision - what has to be true, who decides it, and what to get in writing - rather than a single number that stops being accurate the moment your volume or card mix changes.

Where an answer depends on your own account, it says so and points at the statement line that would tell you. A page cannot know your effective rate, and any page that claims to is guessing.

Why it matters operationally

Only one pricing model lets you see whether your transactions are qualifying. The others are not neutral about that.

The cost of getting this wrong is rarely dramatic. It is a few basis points on every transaction, every month, which is exactly why it goes unexamined for years.

Where operators go wrong

• Comparing two offers on their quoted rate rather than on their markup over interchange.
• Staying on tiered pricing, where a downgrade is absorbed into a bucket and never surfaces.

2 questions in this category

• What is an effective rate, and how do I calculate mine?

  Your effective rate is total processing fees divided by total processing volume for the same period, expressed as a percentage. It includes every fee on the statement: interchange, assessments, markup, monthly fees, PCI fees, gateway fees, batch fees and statement fees. It is the only number that describes what you actually pay, and it is almost always higher than the headline discount rate you were quoted.

  Updated September 30, 2026

• What is interchange-plus pricing, and is it better?

  Interchange-plus pricing passes through the interchange set by the card networks at cost and adds a disclosed markup, itemized separately on your statement. It is better than tiered or flat-rate pricing for most B2B sellers for one specific reason: it is the only model where you can see whether your transactions are qualifying. Under tiered pricing a downgrade is absorbed into a bucket, and under flat rate it does not affect what you pay at all.

  Updated September 30, 2026

This category is still being built out. We keep it linked from the questions hub, but hold it back from search listings until it carries at least 3 published answers — a page with nothing to list is not worth anybody's click.

What to read next

The statement audit checklist walks through calculating your own effective rate before anyone quotes you one.