How Card Processing Fees Work for Small Businesses

When a customer pays your invoice by card, the money you receive is less than the amount charged. The difference is the processing fee. Knowing how it's built helps you compare providers and price your work so the fee doesn't eat your profit.

This article is part of our guide to choosing invoicing software. It uses vendors' pricing pages as checked on 20 September 2026. Rates change and vary by region, so treat the figures as examples.

The usual structure: a percentage plus a fixed fee

The pricing pages we checked all charge card payments the same way: a percentage of the payment plus a fixed amount per transaction.

Jobber's page also lists Tap to Pay at 2.7% + 30¢, and notes that some payment methods and features are limited to the US, Canada and the UK.

A worked example

Take an example rate of 2.5% + $0.25, which is not any provider's price:

• On a $500 invoice the fee is 500 × 2.5% + 0.25 = $12.75, an effective rate of 2.55%.
• On a $40 invoice the fee is 40 × 2.5% + 0.25 = $1.25, an effective rate of 3.13%.

The fixed fee makes small payments proportionally more expensive. Try your own rates in our payment fee calculator.

Why bank transfers cost less

The pricing pages above list a lower rate for bank payments than for cards. FreshBooks and Jobber both list 1%. If your customers are willing to pay by bank transfer on larger invoices, that can save real money. Availability depends on your region and the customer.

Ways to reduce the cost

1. Offer bank payment on large invoices.
2. Compare the fixed fee as well as the percentage, especially if you have many small payments.
3. Include the fee in your pricing. Treat it as a cost of the job. Our markup and margin calculator shows the price you need.
4. Check the plan too. A cheaper subscription with higher fees can cost more overall. See FreshBooks vs QuickBooks vs Wave.

Passing the fee on

Whether you can add a surcharge, and how you must show it, depends on your country or region, and your processor's terms also apply. Check both. This article can't advise on your situation.