Most Utah businesses are overpaying for credit card processing. The exact amount you pay depends heavily on your pricing model, card mix, and processor markup — and the difference between a well-negotiated account and a poorly structured one can be substantial. The good news is that with the right knowledge and the right partner, you can significantly reduce what you pay every month.
Understanding the Three Components of Processing Fees
Your monthly processing statement contains three distinct layers of fees, and understanding each one is the first step toward reducing your costs.
Interchange fees are set by Visa, Mastercard, Discover, and American Express — and they are non-negotiable. Every processor in the country pays the same interchange rates, which are published publicly and updated twice a year (typically in April and October). Interchange rates vary widely by card type: a standard consumer Visa debit card might cost 0.05% + $0.21, while a premium rewards credit card can cost 2.40% + $0.10 or more. The card network keeps a portion of interchange to compensate the cardholder's issuing bank.
Assessment fees (also called network fees) are charged by the card networks themselves — Visa, Mastercard, etc. — and are also non-negotiable. These are small, typically 0.13%–0.15% per transaction, and are often buried in your statement.
Processor markup is what your payment processor charges on top of interchange and assessments. This is the only component that is negotiable, and it is where the biggest savings opportunity lies for most businesses.
The Four Pricing Models You Need to Know
Flat-rate pricing bundles interchange, assessments, and the processor's markup into a single percentage. Square charges 2.6% + $0.15 for in-person transactions and 3.5% + $0.15 for manually keyed transactions. Stripe charges 2.7% + $0.05 for in-person and 2.9% + $0.30 for online. These rates are simple and predictable, but they are expensive — especially for businesses with a high volume of low-cost card types like debit cards.
Interchange-plus pricing separates the actual interchange cost from the processor's markup. You pay the real interchange rate (which varies by card) plus a fixed markup — for example, interchange + 0.30% + $0.10. This model is transparent and almost always cheaper for businesses processing more than $5,000 per month.
Tiered pricing groups transactions into "qualified," "mid-qualified," and "non-qualified" buckets, each with different rates. This model is common among traditional processors but is widely considered the least transparent, as processors decide which tier each transaction falls into.
Subscription pricing charges a flat monthly fee plus a small per-transaction fee, with interchange passed through at cost. This model can be very cost-effective for high-volume businesses where the savings on per-transaction rates outweigh the monthly membership cost.
6 Proven Ways to Lower Your Processing Costs
Switch to interchange-plus pricing. If you are currently on flat-rate or tiered pricing, this single change is often the most impactful move you can make. Interchange-plus exposes the actual cost of each transaction and eliminates the processor's ability to pocket the difference between your flat rate and the actual interchange.
Implement a cash discount or surcharge program. A properly structured cash discount program allows you to display a standard price that includes the cost of card acceptance, then offer a discount for customers who pay with cash. This is legal in all 50 states and can effectively eliminate your processing fees entirely. Credit card surcharging — adding a fee for card-paying customers — is also legal in most states, though it requires registration with the card networks and is prohibited in Connecticut, Maine, Massachusetts, and Oklahoma.
Encourage debit card payments. Debit cards carry significantly lower interchange rates than credit cards. A standard Visa debit card processed with a PIN carries one of the lowest interchange rates available under the Durbin Amendment cap for large issuers. A simple "debit preferred" prompt at checkout can meaningfully reduce your average blended rate.
Batch your transactions daily. Transactions that are not settled within 24 hours of authorization are subject to "downgrade" fees — higher interchange rates that the card networks charge for delayed settlement. Most modern POS systems batch automatically, but it is worth confirming with your processor.
Get a statement review. A qualified merchant services provider can analyze your current statement and identify exactly where you are overpaying. At UBC Unlimited, we provide complimentary statement reviews for Utah businesses and show you a side-by-side comparison before you make any changes.
What to Expect in Savings
The amount you can save depends on your current pricing model, monthly volume, and card mix. Businesses on flat-rate pricing with moderate-to-high volumes typically see the most dramatic reductions when switching to interchange-plus. Businesses that implement a cash discount program can reduce their effective processing cost to near zero on cash transactions.
Ready to find out exactly how much your business could save? Request a statement review — no obligation, no pressure, just a clear picture of your current costs and what better options look like.