Credit Card Fee

What is a credit card fee?

Credit card fees are the costs associated with accepting credit card payments or using business credit cards. When you accept cards, you pay merchant processing fees. When you use your business credit card, you may pay annual fees, interest charges, and foreign transaction fees. Both types of fees affect your bottom line and should be managed carefully.

Fees for accepting cards

Processing fees include interchange fees paid to the card-issuing bank, assessment fees paid to the card network, and markup charged by your processor. These typically total 2% to 3% of each transaction. High-volume businesses can negotiate lower rates. For small transactions, per-transaction fixed fees can represent a significant percentage of the sale.

Fees on your business credit card

Business credit cards may charge annual fees ranging from zero to several hundred dollars. Interest charges apply to unpaid balances, typically at 15% to 25% APR. Late payment fees, cash advance fees, and foreign transaction fees add up. Pay balances in full monthly to avoid interest. Compare total cost of ownership when choosing business cards.