Credit card processing fees: what determines your rate and why the lowest isn't always the cheapest

Credit card processing fees, also known as the merchant discount rate (MDR), typically fall somewhere between 1% and 3.5% of the transaction value, depending on the market, the card type, and how the payment is processed. That rate is made up of three separate fees, set by three different parties:

1. Interchange is paid to the cardholder's issuing bank and is the largest component of most transactions.

2. Scheme fees go to the card network itself, Visa, Mastercard, and others, for the use of their infrastructure.

3. Processor markup goes to your payment provider and is the only one your provider actually controls.

Rates vary by network. A standard Mastercard transaction typically falls between 1.95% and 2.60% plus a small flat fee, with both Visa and Mastercard falling back to a non-qualifying rate of around 3.15% plus $0.10 when a transaction doesn't meet data requirements. Combined, the average Visa and Mastercard swipe fee, or credit interchange rate, reached 2.36% in 2025, according to the , citing data from the Nilson Report. American Express and Discover tend to run slightly higher, partly because American Express often acts as both the credit card network and the issuing bank. For the full published rate tables, see and .

Most of your processing fee is fixed before your provider is involved at all. Here's who sets each component and why.

Table breaking down credit card processing fees

Several factors determine where in the interchange fee range a transaction lands:

• Card type: Debit cards generally carry lower interchange than credit cards since the funds are verified immediately. Rewards cards and corporate cards typically sit higher, since the cost of funding rewards programs is factored into the fee.

• Transaction method: In-person transactions tend to sit at the lower end of the range. Card-not-present transactions, including online and phone orders, sit higher since they carry more fraud risk for the issuing bank.

• Merchant category code: Retail and ecommerce businesses typically fall into different MCC categories, each carrying its own default interchange rate, while B2B credit card processing fees tend to run higher due to the commercial card types commonly used in those transactions.

• Data quality: Transactions accompanied by richer data, such as billing details or line-item information, are more likely to qualify for lower interchange categories than those with limited information.

While none of these are negotiable in the same way a provider's markup is, they can be influenced. How a transaction is processed, what data accompanies it, and which network it routes through can all shift a transaction into a lower-cost category. That's what we'll cover in the next section.

For the full mechanics behind these numbers, including how Interchange++ pricing differs from blended pricing and how regional rate caps work, see our .

Negotiating your provider's markup is a starting point. But the bigger gains come from changing how transactions qualify for cost in the first place. Here's where to focus:

Process locally rather than cross border

Like mobile roaming fees, transactions processed locally tend to be cheaper than those processed cross border. Processing transactions through local entities lowers the per-transaction cost and can also improve approval rates since domestic transactions tend to face less friction with issuing banks.

Support different payment methods

Offering other payment methods alongside cards reduces reliance on scheme fees and can lower the cost per transaction, particularly in markets where card-based payment isn't the default.

Optimize your transaction routing

Directing a transaction through the best-performing network for that specific payment, rather than a single fixed route, can lower cost and reduce declines at the same time.

Share additional data to the schemes

Sending richer transaction data with each payment, such as billing details or line-item information, can qualify a transaction for a lower interchange category.

Use network tokens instead of static card details

Card networks typically charge less to process a token than a standard card number and it can improve authorization rates too.

All these savings are achieved by changing how a transaction qualifies in the first place. The right payment provider should focus on this, rather than simply promising cheaper fees. Learn more in our report.

Adyen is a financial technology platform providing merchant services to enterprises including Uber, Spotify, eBay, and Hilton. We have full banking licenses in the UAE and across Europe, the UK, and the US and principal membership of Visa and Mastercard in major markets. We processed €1.39 trillion in volume last year. Here’s what you can expect if you choose us for your credit card processing:

Cut cross-border fees with local acquiring across 45 markets

Domestic transactions are typically 59% cheaper than cross-border. We hold local acquiring licenses across 45 markets so you can process transactions domestically instead of routing them cross-border or splitting them across multiple local entities and providers. 

"Adyen helped us with local acquiring in the US, which had a positive effect. We were able to reduce our bank declines by 21%." 

Dennis Friemerding, Team Lead Payments at Flixbus.

Accept over 200 payment methods through one integration

Adding local payment methods alongside cards saves an average of 49% per transaction on scheme fees. We support over 200 payment methods through a single integration, so you can offer the payment method customers prefer without adding separate contracts for each one. 

Lower cost per transaction with payment intelligence

A fixed routing path, missing scheme data, or static card number can all push a transaction toward a higher fee or a higher chance of decline. To combat this, we optimize payments on a per-transaction level by: 

• Dynamically selecting the network with the best rate and the highest approval odds, cutting costs by 26%.

• Passing enhanced scheme data to the schemes to qualify eligible transactions lowering interchange by up to 1%.

• Replacing static card numbers with network tokens, which schemes typically charge less to process and can increase authorization by 6%.

Reduce the costs that never show up as a fee line

Separate integrations and unmanaged fraud risk add real cost outside the processing statement. Our single platform and fraud tools work to stop this. A Forrester study found 

• 75% lower operational headcount to launch new markets

• 27% fewer chargeback write-offs

• 40% fewer false declines on average. 

''Without Adyen, we would have had to hire more payment experts.''

Natasha Belinska,

Daniel Wellington

Credit card processing fees are made up of a stack of charges, most of which sit outside your provider’s control. Once you know which fees are fixed and which aren't, you can shift the conversation away from: “what's your rate?” To: “what's the total cost of running this transaction, end to end, and how can you help me lower it?”

Talk to a payments expert about what your specific cost of payments looks like, or explore the full Strategies to Reduce Your Total Cost of Payments report.