Payment Gateway Fees: The Five-Layer Fee Stack
Where every cent of your processing bill actually goes, and which layers are negotiable.
Every card transaction stacks five fees: interchange (to the issuing bank, ~1.6%-2.5% on US credit), assessment (to Visa/Mastercard, ~0.13%-0.15%), gateway (a per-transaction cents fee), processor markup (negotiable, ~0.15%-1%+), and ancillary (disputes, monthly statement, PCI, FX). Flat-rate vendors bundle all five into one number. Interchange-plus exposes them so you can see what is negotiable.
The five layers, in order of size
Layer 1: Interchange
Set by the card networks (Visa, Mastercard, Amex, Discover), paid to the issuing bank that gave your customer the card. The biggest layer. Not negotiable in any direct sense: every merchant pays the same interchange for the same card type at the same channel.
- Regulated debit (Reg II) capped at $0.21 + 0.05% per transaction.
- Unregulated credit ranges roughly 1.5%-3.3% depending on card category, channel, and AVS verification.
- Rewards and corporate cards carry higher interchange. This is why your blended rate creeps up if your customer mix shifts.
Reference: Federal Reserve Reg II implementation, and the Nilson Report's published US card-issuer interchange tables. See interchange fees explained for the per-network breakdown.
Layer 2: Assessment (network) fees
Paid to the card network itself (Visa, Mastercard, Amex). Tiny by comparison, around 0.13% to 0.15%. Pass-through on interchange-plus pricing. Not negotiable.
Layer 3: Gateway fee
A per-transaction fee for the gateway service (the part that takes the card, tokenises it, fires the auth, and lands a webhook on your server). On Stripe and PayPal this is bundled into the headline rate. On Authorize.Net the gateway fee is explicit: $25/mo + 10c per transaction.
Layer 4: Processor markup
The processor's margin on top of interchange and assessment. The most negotiable line. On flat-rate this is invisible. On interchange-plus it is the percentage and cents number after the “+” (e.g. IC + 0.30% + 15c).
US credit-card interchange has trended upward across the past decade while the regulated debit cap has stayed flat (Federal Reserve regulated-debit data: see federalreserve.gov/paymentsystems/regii-data-collections.htm). Merchants moving from flat-rate to interchange-plus surface this trend in their own monthly statements and capture the markup-layer savings as their volume grows.
Layer 5: Ancillary fees
The fees that never show in a headline rate. The line that surprises every CFO who only looked at the percentage.
- Chargeback / dispute fees. Stripe two-tier $15 + $15 since 17 Jun 2025. PayPal $20. Square $0.
- PCI compliance fees on some flat-rate vendors ($10-$30/mo). See PCI compliance cost.
- Cross-border surcharge typically +1% to +1.5%.
- FX margin: Stripe 1%, PayPal up to 4%, Wise at mid-market with a per-pair spread.
- Monthly statement, batch, and minimum-bill fees on traditional processors.
- Rolling reserve on high-risk verticals: 5%-10% of volume held 90-180 days.
Worked illustrative breakdown of a $100 sale
(illustrative example, not a real company)
Where each layer is negotiable
- Interchange: not negotiable. Set by the network. Reduce it by routing more volume through regulated debit, encouraging AVS-verified card-present where possible, and avoiding manually keyed transactions.
- Assessment: not negotiable. Pass-through.
- Gateway: somewhat negotiable above $1M/yr. On Authorize.Net the $25/mo is published and rarely moves.
- Processor markup: the most negotiable layer. Above $80K/mo, most processors will move from flat-rate to interchange-plus with a markup of 0.15%-0.40%.
- Ancillary: dispute and FX fees are often a negotiated line item in larger contracts. PCI fees are usually waivable if you self-certify SAQ-A.