7 Hidden Merchant Account Fees (And What to Do About Them)

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Are you looking for a merchant account? If so, beware of the ‘hidden fees’ that could make your payment processing much more expensive than you think.

If you’re comparing costs between merchant services providers, make sure you take these costs into account.

Setup Fees

Some merchant account and payment gateway providers charge a ‘setup fee’ for setting up your account. This can range from around £45 to £195 or even more for a high-risk merchant account. Unless the provider will be doing lots of work to help you with integrating their payment solution, it’s worth seeing if they’ll waive this fee for you.

Typical fees: £45 to £195.

Chargeback Fees

Chargeback fees arise when a cardholder challenges a payment made to you. They may be looking through their credit card bill and have spotted a charge that they don’t recognise, or they may feel they haven’t received the product or service that they expected. In either case, they’ve contacted their credit card issuer to complain. If you have evidence that the cardholder did indeed authorise the payment to you, then you can contest the chargeback and hopefully get the cardholder’s claim overturned. Otherwise the transaction will be reversed and on top of this you will be charged a ‘chargeback fee’.

Typical fees: £6 to £15 per chargeback.

Monthly Minimum Fee

Many payment processors have a minimum monthly fee that they will charge, often around £20. If you’re a medium-sized or large merchant this shouldn’t be a problem. But this can bite you if you’re only processing a very small number of transactions per month.

Typical fee: up to £20 per month

PCI Compliance Fee

Some merchant account and payment gateway providers will charge you a mandatory fee to verify through their preferred qualified security assessor (QSA) that you are PCI DSS compliant (in other words, that you are handling customers’ payment details securely).

Typical fee: £100 to £150 per year.

Early Termination Fee

When you sign a contract with a merchant account provider it’s very common for a minimum contract length to be included — 48 or 36 months, for example. This is particularly so when they’ll be providing you with one or more credit card machines. If you leave the contract early you may be charged a significant ‘early termination fee’ for doing so. Check the fine print of your contract carefully before signing up so that you understand what you’re getting into.

Typical fee: £100s

Fees for International Cards

When you take payments from cards issued by foreign banks, you’ll almost always pay more than when taking payments from UK cards. The exact amount will often depend on the country where the card was issued.

Typical fee: 1% – 3% extra per transaction.

Fees for Corporate Cards

As with international cards, you’ll often pay a higher rate to receive payments from corporate (or business) credit and debit cards.

Typical fee: around 1% extra per transaction


Choosing a merchant account or payment gateway can be a confusing process as there are lots of hidden fees to watch out for. When you’re comparing payment providers, look out for fees for account setup, chargebacks, monthly minimums, PCI compliance, international and corporate cards, and early termination. Before signing a contract, read it thoroughly to make sure there are no nasty surprises!

What other ‘hidden fees’ have you seen? Let us know in the comments.

Matt Collins

Matt's the founder of PaymentBrain. He enjoys helping business owners navigate the confusing world of payment processing.

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