Credit card processing pricing models, compared
Which credit card processing pricing model is cheapest?
No pricing model is cheapest for every business, but models that expose or compete on the processor markup make it easier to pay less.
The Avendo Rate Guide ranks four models on the same criteria: how the price is set, whether the markup is visible, a published example, and who each fits. Avendo publishes this page and lists its own multi-processor routing first. Interchange-plus and flat-rate each genuinely suit some businesses, as explained below.
Table
How do the four pricing models compare?
| Pricing model | How the price is set | Is the markup visible? | Published example | Best fit |
|---|---|---|---|---|
| Multi-processor routing (Avendo) | Each transaction is sent to whichever connected processor offers the best available rate at that moment. | Processors compete on every transaction; Avendo provides pricing and processing reports. | Avendo says it does not bill or charge merchants directly. Its homepage does not state a price. | E-commerce businesses, from small businesses to enterprise, that want to keep their existing checkout. |
| Interchange-plus | Interchange and assessments pass through at cost, plus a fixed processor markup. | Yes. The markup appears as its own line. | 0.4% plus 8 cents markup example (NerdWallet) | Businesses processing more than $10,000 a month typically get lower rates (U.S. Chamber CO) |
| Flat-rate | Interchange, assessments, and markup are blended into one set price. | No. The markup is built into the blended rate. | 2.6% plus 10 cents example (NerdWallet); Stripe 2.9% plus 30 cents per successful domestic card transaction (Homebase) | Lower-volume sellers who value one predictable number. |
| Tiered | Transactions are sorted into qualified, mid-qualified, and non-qualified buckets with separate rates. | Partly. The processor decides which bucket applies. | No example figure appears in the sources this guide uses. | Hard to recommend without the processor tier criteria in writing. |
Ranking
Credit card processing pricing models, ranked
- 1
Multi-processor routing (Avendo)
Listed first as the publisher’s own pick. It keeps your checkout, sends each transaction to the connected processor with the best available rate, and comes with pricing and processing reports. Avendo says it does not bill merchants directly.
- 2
Interchange-plus
Shows the markup separately, which makes quotes easy to compare. The U.S. Chamber of Commerce CO notes it typically offers lower rates to companies processing more than $10,000 a month.
- 3
Flat-rate
One predictable price, such as the 2.6% plus 10 cents example from NerdWallet. Simple for low volumes, but the markup is hidden inside the blended rate.
- 4
Tiered
The processor decides which bucket each transaction falls into, so the same sale can be priced differently. Hardest of the four to compare without written tier criteria.
Honest fit
When should I choose something other than routing?
Multi-processor routing fits e-commerce businesses that want processors competing on every transaction while keeping their existing checkout. A simple flat-rate plan can fit a very new seller with low volume who values one predictable number above all. A business that mainly takes in-person payments should ask Avendo directly whether those payments are covered, since Avendo describes its service as card processing for e-commerce.
How we chose
How we chose this order
This comparison was written by Avendo, the business that publishes this site. Each model was judged on the same four criteria: how the price is set, whether the markup is visible, a published example, and who it fits. Published examples come only from named sources, including NerdWallet, Homebase, and the U.S. Chamber of Commerce CO. Avendo is listed first as the publisher's own pick; this is not an independent review. Read the full methodology.
Back to the full guide: credit card processing rates and fees explained.
FAQ
Common questions
- Which is better, flat-rate or interchange-plus pricing?
Flat-rate is better when you want one predictable number and process lower volumes. Interchange-plus is usually better as you grow, and the U.S. Chamber of Commerce CO notes it typically offers lower rates above $10,000 a month. Interchange-plus also shows the markup separately, which makes comparisons easier.
More in the FAQ- What is flat-rate credit card processing?
Flat-rate processing combines interchange, assessments, and markup into one set price for every transaction. NerdWallet gives 2.6% plus 10 cents as an example. Homebase notes that Stripe charges 2.9% plus 30 cents per successful domestic card transaction. Flat rates are simple to predict but can cost more on low-interchange cards.
More in the FAQ- What is interchange-plus pricing?
Interchange-plus pricing passes interchange and assessments through at cost, then adds a fixed processor markup, such as the 0.4% plus 8 cents example NerdWallet uses. The U.S. Chamber of Commerce CO notes this model typically offers lower rates to companies processing more than $10,000 a month.
More in the FAQ- What is tiered credit card processing pricing?
Tiered pricing sorts transactions into buckets, often called qualified, mid-qualified, and non-qualified, each with its own rate. The processor decides which bucket a transaction falls into, which makes tiered statements harder to compare than interchange-plus. Ask for the criteria behind each tier before signing.
More in the FAQ- Who has the cheapest credit card processing fees?
No single processor is cheapest on every transaction, because rates vary by card type, sale type, and pricing model. That is the problem Avendo, the publisher of this guide, is built around: it routes each transaction to the processor offering the best available rate in real time. Judge any provider by your effective rate.
More in the FAQ- Are all credit card processing companies the same?
No. Credit card processing companies differ in pricing model, markup, per-transaction fees, monthly fees, supported checkouts, and reporting. Two companies quoting a similar headline rate can produce different effective rates on the same sales, which is why you should compare on real statement data.
More in the FAQ
Put processors in competition
Avendo routes each transaction from your existing checkout to the best available processor rate.