Where on a merchant statement do you find what card processing actually cost you?
Summary
In the charges and fees section, not in the deposit. The gap between sales and what reached your bank also holds refunds, chargebacks, and adjustments, so it is always larger than the processing cost. Divide the fees section's total by card sales and you have the rate you really paid that month.
The deposit is the wrong place to start
Say a shop takes 400 in-person card sales averaging $50, for $20,000 in a month, on Chase's published rate of 2.6% plus 10¢.
In the same month the shop refunds $300 and loses a $150 chargeback. The bank receives $20,000 minus $560, $300, and $150, which is $18,990. Treat the whole $1,010 gap as processing fees and the rate looks like 5.05%. Chase's own guide gives the reason in one line: your deposit may differ from sales due to fees, refunds, or chargebacks.
What the sections are for
Chase's statement guide for merchant services accounts lists the sections in this order:
- Cover page
- Deposit summary
- Funding summary, which shows daily deposits with chargebacks, reversals, adjustments, and fees taken out, and the net amount you actually received
- Credit card summary
- Chargebacks and reversals
- Pre-disputes
- Financial adjustments
- Charges and fees
"Amount Transferred" under Totals is the net transfer to your account. Statements are typically generated on the 1st or 2nd of each month. The name of your pricing plan sits at the bottom left, and it tells you what shape the fee lines will take: one rate on a flat plan, or a line per card type plus a processing fee on interchange pass-through.
How a fee line is built
Every line in the fees section comes from one of two formulas in Chase's guide. A percentage line is sales amount times rate, so $1,000 at 2% is $20. A per-item line is items times item charge, so 50 items at $0.10 is $5.
The guide also names the kinds of fee you may find: interchange, assessment fees from the card networks, access fees, and monthly fees for account maintenance or statement delivery. A month in which the business falls short of an agreed minimum transaction amount can carry an account minimum fee, which may be labeled a monthly service fee, an internet service fee, or some other supplemental charge.
Interchange rates are set by the card brands and, in Chase's words, can change twice a year, in April and October. A rate that moves on an unchanged plan in one of those months has an obvious suspect.
Daily or monthly billing
Chase lets a merchant have fees taken out of each day's deposit or held back to month-end. On monthly billing the daily deposits arrive in full and all processing fees are collected at the end of the month, for a fee of 0.03%. Switching to daily billing is free at any time. For a shop on monthly billing, the daily deposits say nothing about cost, and the month's fees appear in one debit and in the charges and fees section.
Sources
Related on this site
- Does a flat rate, interchange-plus, tiered, or subscription plan cost a merchant the least?
- How much more does a chargeback cost a merchant than a refund?
- How to read the effective rate on this site
- What the headline rate leaves out
- Effective rate calculator
Written by Kaz (pen name). Figures are copied from providers' published pricing pages on the dates shown. We have not used these products. Corrections: contact form.