Every line on a processing statement, and what each one means.
Statements are written in acronyms, and the acronyms are not explained anywhere your processor will show you. This is the full list, in plain language, with the only thing that actually matters marked against each one: whether it is a pass-through cost or your provider's own charge.
What this page settles.
Three questions, in the order most people ask them.
The three kinds of charge
Before the list, the thing that makes the list usable. Every charge on a processing statement is one of three things, and knowing which one you are looking at tells you immediately whether there is any point arguing about it.
Interchange goes to the bank that issued your customer’s card. It is published by Visa and Mastercard, it is the same for every business in a given category, and no provider can discount it. On the worked statement here it is 1,021.00 of 1,687.50 — a little over 60% of the bill. More on interchange here.
Assessments and network fees go to Visa, Mastercard, Discover and American Express for running the rails. Also fixed, also published, also not negotiable.
Your processor’s own fees are everything else. This is the only part anybody can change, and on this statement it is 666.50 a month. It is where every conversation about price should start and usually does not.
A processor that is passing through interchange and assessments at cost will show them to you as separate lines. A processor that is not will bundle everything into a percentage and a surcharge, which is what tiered pricing does.
Percentage charges
Discount rate. The headline percentage. On tiered pricing this is the qualified rate and applies to a minority of your sales. On interchange-plus it is the markup over interchange and applies to all of them. Same words, very different meanings.
Qualified / mid-qualified / non-qualified surcharge. The uplift applied when a transaction does not meet the conditions for the cheapest tier — usually because of the card your customer carried, not anything you did. The full explanation is here.
Interchange. Pass-through. See above.
Assessment fee. Visa and Mastercard’s own percentage, charged on volume. Small, universal, and genuinely not negotiable. Any provider claiming to discount assessments is describing something else.
Cross-border fee. Applied when the card was issued outside the United States, even if the customer is standing in front of you. Pass-through from the card network.
International service assessment (ISA). The same idea under a different name on some statements.
Dynamic currency conversion (DCC). A charge connected to offering a foreign cardholder the option to pay in their own currency. Usually optional, usually sold to you as a revenue share, and worth reading the terms on.
Per-transaction charges
Authorization fee / auth fee. Charged when a transaction is authorized, whether or not it settles. A declined card can still cost you an authorization.
Transaction fee / per-item fee. Charged on each settled sale. The one that hurts a low average ticket most: at a $9 average ticket, a 10¢ per-item fee is over 1% on its own.
NABU (Network Acquirer Business Unit) fee. Mastercard’s per-authorization charge. Appears on nearly every statement that carries Mastercard volume and is explained on almost none of them.
APF (Acquirer Processing Fee). Visa’s equivalent, charged per authorization.
Network access and brand usage (NABU, APF, AVS, and friends). Collectively, the card networks’ per-transaction charges. Pass-through, small individually, and worth knowing are not your processor’s invention.
AVS (Address Verification Service) fee. Charged when your terminal or gateway checks the billing address against the card. Worth paying: it reduces fraud and usually improves your interchange, so it often costs less than skipping it.
Voice authorization fee. Charged when a transaction is authorized by telephone rather than electronically. Rare now, and if it is appearing regularly something is wrong with your setup.
Misuse of authorization fee. Charged when a transaction is authorized but never settled or reversed. It is a penalty for leaving authorizations dangling, and a run of them points at a terminal or workflow problem rather than a pricing one.
Batch / settlement fee. Charged each time you close out the day. If your terminal is set to batch several times a day you are paying this several times for no benefit. One batch a day is standard — and batching late can also push transactions into a worse tier.
Fixed monthly and annual charges
These are the ones that do not scale with your sales, which means the smaller your business the more they cost you in percentage terms. Totalled and annualized here.
Monthly minimum. A floor on what your processor earns. If your processing fees come to less than the minimum, you are billed the difference. The only charge on your statement that punishes a quiet month.
Monthly service / statement fee. A flat charge for having the account. Sometimes genuinely covers a paper statement you never asked for.
Paper statement fee. Charged for posting you a statement. Almost always removable by switching to electronic delivery, and almost never mentioned.
Annual fee. Billed once a year, usually large enough to notice, and usually timed eleven months after you stopped thinking about the agreement.
PCI program / compliance fee. A charge for a compliance portal and support service. Distinct from the penalty below, and a pricing question rather than a mistake. The difference matters.
PCI non-compliance fee. A penalty for not having filed your annual security questionnaire. Not a tax, not a Visa requirement, and endable in about an hour. How to end it.
Account on file / account maintenance fee. A charge for the existence of the account. If you are already paying a monthly service fee, ask what this one buys that the other does not.
Wireless / data fee. For terminals on a cellular connection. Legitimate if your terminal genuinely uses mobile data; worth checking if it has been sitting on your wi-fi for three years.
Gateway fee. For online and keyed payments. Sometimes bundled, sometimes separate, sometimes billed by a different company entirely so it never appears on the processing statement at all. More on gateway pricing.
1099-K reporting fee. A charge for filing the IRS form your processor is already required to file. Reasonable people differ on whether that should carry a fee.
Setup / application fee. One-off, at the start. Often waivable simply by asking before you sign, and never after.
Dispute and exception charges
Chargeback fee. Charged when a customer disputes a transaction. Most agreements charge it whether you win or lose. The whole process explained.
Retrieval request fee. Charged when an issuing bank asks for documentation on a transaction before any dispute is filed. Answering one promptly often prevents the chargeback, which makes this the cheapest fee on the statement to take seriously.
Reversal / representment fee. Charged for submitting your evidence in a dispute. Not every processor has one; check before you decide whether a small dispute is worth fighting.
Chargeback monitoring programme fees. Charged when your dispute ratio crosses a card network threshold and you enter a monitoring programme. What the thresholds are.
NSF / ACH reject fee. Charged when your processor tries to collect fees from your bank account and the debit bounces. Worth knowing it exists, because it compounds a bad month.
Equipment and software charges
Equipment lease. Not strictly a processing fee, but it belongs on this list because it behaves like one: fixed, monthly, and frequently non-cancellable. A lease can outlast the processing agreement by years and is routinely the single most expensive thing in the relationship. Read this before anything else on the page.
Equipment rental. Usually month-to-month and cancellable, which makes it a very different thing from a lease despite sounding similar. Check which one you signed.
Terminal reprogramming fee. Charged to reconfigure a terminal, often when you switch. Ask about it before you plan a switch, not during one.
Software / POS subscription. Billed by the software company, your processor, or both. If you are paying for point-of-sale software you do not use, that is often larger than every fee above it combined.
Charges with official-sounding names
A short category of its own, because the naming is the point.
“Regulatory” fee, “compliance” fee, “network access” fee, “annual compliance” fee. Some of these genuinely pass through a card-network charge. Many are the processor’s own revenue with a name chosen to sound mandatory. The test is simple, and it is here.
The question to ask about any of them is the same: what specifically does this fund, and what happens if I ask for it to be removed? A charge that genuinely passes something through can be named and evidenced in about a minute. One that cannot usually goes away when challenged.
What to do once you have the list
Three things, in order, and they take about ten minutes between them.
First, mark every line on your statement as pass-through or processor’s own. The list above tells you which is which. Add up the second group.
Second, multiply the fixed monthly charges by twelve. Most merchants have never seen that annual number, and it is usually the moment the conversation about price stops being abstract.
Third, ask about anything you cannot explain. Not aggressively — just ask what it funds. The answer, and how quickly it arrives, tells you a great deal about the relationship.
What we charge
Interchange + 0.50% + 10¢ in person, interchange + 0.75% + 25¢ keyed. No contract, no monthly fee, no monthly minimum, no PCI fee, no statement fee and no annual fee. Interchange and the card network charges are passed through at cost.
Send us one statement and we will do the three steps above for you, name every line on it, and tell you plainly if the answer is that you are already priced fine.
While we are on the subject
Why does my statement use so many acronyms?
Because most of them come from the card networks’ own fee schedules and are passed through with their original names. Your processor is not inventing them to confuse you, but it also has no incentive to translate them.
Which of these can I actually get removed?
As a rule, anything your processor sets rather than passes through — monthly minimum, statement fee, annual fee, PCI program fee, batch fee. Interchange and the card network charges are fixed for everyone.
My statement has a line that is not on this page. What is it?
Send it to us. Processors use their own names for the same charges, and the list below uses the most common ones. A line nobody can explain to you is worth asking about regardless.
Does PosNexus charge most of these?
No. There is no monthly fee, no monthly minimum, no PCI fee, no statement fee and no annual fee on our pricing. Interchange and the card network charges we pass through at cost, because there is no other way to pass them through.