Processing fees and pricing
How do I calculate my effective processing rate?
Direct answer
Choose one statement period, add the processing costs you want to measure, divide that total by the card sales volume for the same period, and multiply by 100. Label every included and excluded line. For an apples-to-apples provider comparison, include the same categories—such as interchange, assessments, markup, authorization, PCI, monthly, gateway, and equipment fees—on both sides.
- Author
- AMP Payment Systems
- Review status
- Primary sources checked; no named AMP subject-matter reviewer is claimed.
- Published
- Modified
Key facts
- Keep time periods aligned.
- Document fee inclusions and exclusions.
- Use net or gross volume consistently.
Build the numerator
Start with all charges connected to accepting and supporting card payments. Create separate subtotals if you also want to compare processing-only cost and complete system cost.
Choose the denominator
Use the statement’s matching card sales volume, checking whether refunds, returns, and adjustments are netted. Do not mix annual fees with one month of volume unless you normalize them.
Worked calculation
If included monthly fees total $1,920 and matching card volume is $75,000, then $1,920 ÷ $75,000 × 100 = 2.56%.
When the answer changes
- Annual and quarterly fees should be allocated consistently.
- A month with unusually low volume can produce a misleading snapshot.
Common mistakes
- Using deposits as the sales-volume figure.
- Leaving fixed fees out of one comparison.
What to verify
- Reconcile the fee total to the statement.
- Repeat the calculation for three to twelve months when available.
Primary sources
Apply the answer to your business
AMP can help organize your payment, POS, or statement questions. Any recommendation, availability, pricing, or approval depends on the final written configuration and provider terms.
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