Debit Card Processing Fees For Merchants

For most businesses, debit beats credit on price -- and smart processing makes it even cheaper.

WRITTEN & RESEARCHED BY
Erica Seppala
Editor & Senior Staff Writer

Last updated onUpdated September 22, 2025

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Key Takeaways

Debit card transactions usually cost less than credit because they carry lower risk and, for many banks, are capped by law.
Your actual debit processing costs depend on network fees, transaction type, and your processor’s pricing model.
Choosing the right processor, pricing plan, and debit setup can prevent overpaying and keep your costs as low as possible.

Debit cards and credit cards often get lumped together, but they’re not the same. Credit cards let the issuing bank front the money, while debit cards pull it straight from a customer’s account. That makes debit transactions lower risk — and usually cheaper — for merchants.

Merchants need to understand debit card processing fees — not just because they differ from credit card fees, but because a smart acceptance strategy can save you money. In this guide, we’ll cover what these fees are, how much they cost, how they’re regulated, and how you can avoid overpaying.

Table of Contents

What Are Debit Card Processing Fees?
How Much Are Debit Card Processing Fees?
Are Debit Card Transaction Fees Regulated?
How Debit Card Fees Work: Interchange VS Processor Markup
Understanding Signature Debit VS PIN Debit
Breaking Down Debit Card Transaction Fees For Merchants
How To Avoid Overpaying For Debit Card Transaction Fees
Are Debit Card Fees Worth It?

What Are Debit Card Processing Fees?

Whenever a customer pays with a debit card, a fee is charged for moving that money from their account to yours. These fees aren’t just a flat number; they’re based on these factors:

How the card is verified: PIN vs. signature
How the payment is processed: Card-present or online
Which network is used: Visa, Mastercard, STAR, Interlink, etc.
Your processor’s pricing model: Interchange-plus, membership, flat-rate, or tiered

Basically, your total cost is the sum of your network fees and your processor’s markup. Understanding this structure is key to keeping fees low.

How Much Are Debit Card Processing Fees?

According to the Federal Reserve, the average fee in 2023 was about $0.23 per transaction, or 0.65% of the transaction value. For comparison, credit card fees average around 1.4%

Are Debit Card Transaction Fees Regulated?

The Durbin Amendment (part of the 2010 Dodd-Frank law) caps fees for large banks (over $10 billion in assets) at:

0.05% of the transaction value
$0.21 per transaction ($0.22 if fraud is suspected)

This cap applies to both card-present and online transactions.

Smaller banks aren’t regulated, but competition usually keeps their fees close to these levels.

How Debit Card Fees Work: Interchange VS Processor Markup

When a debit card is used, your transaction goes through a network (PIN or credit card) and incurs interchange fees. Your processor adds a markup depending on your pricing plan.

Factors that determine your interchange fees include:

Card networks: Different networks have different fees. STAR, Interlink, Maestro, and Interac are examples.
Bank size: Regulated banks have fee caps.
Signature vs PIN debit: PIN transactions are cheaper and more secure.
Card-present vs card-not-present: In-person is cheaper than online or keyed-in payments.

Understanding Signature Debit VS PIN Debit

When a customer pays with a debit card, the transaction can be processed in two ways: PIN debit or signature debit.

With PIN debit, the customer enters their PIN at the terminal, and the payment runs through a PIN debit network like Interlink or Maestro.

Fees here usually mean higher fixed costs per transaction but lower percentage fees, which makes PIN debit better for large-ticket sales. For very small purchases, though, those fixed fees can make it more expensive than credit cards.

With signature debit, the transaction runs through the major credit card networks — Visa, Mastercard, Discover, or Amex — just like a credit card. Instead of a PIN, the customer signs or simply authorizes the purchase.

Fees here tend to be the opposite of PIN: lower per-transaction charges but higher percentage fees, making signature debit more cost-effective for smaller ticket sizes. Online and manually keyed-in debit purchases also fall under this category, since there’s no PIN option.

Overall, PIN debit is safer since fraudsters rarely have the cardholder’s PIN, while signatures are easy to forge. That’s why Mastercard and Visa have dropped signature requirements for most transactions.

Breaking Down Debit Card Transaction Fees For Merchants

These are the types of fees charged by the payment networks that process PIN-authenticated debit transactions:

Fee Type	What It Is
Percentage Rate	Percentage of the transaction
Transaction Fee	Fixed fee per transaction (also known as an authorization fee)
Flat Switch Fee	Fee for routing through the network ($0.03–$0.10)
Annual Fee	Flat yearly fee for network participation (optional)
Non-Interchange Fees	Extra fees for cross-border or non-US cards

Regulated Debit Network Fees

If the issuing bank is large enough to fall under the Durbin Amendment, debit transaction fees will almost always be fixed at the maximum amount allowed by law.

Large banks generally stick to this maximum, since it’s already far lower than what smaller, exempt banks can charge.

Exempt Debit Network Fees

For smaller banks and credit unions that aren’t subject to Durbin, there’s no hard cap. Fees vary by network and transaction type, and can be much higher, especially for prepaid debit or very small purchases (under $15).

Here are some average costs for each network based on data from the Federal Reserve (Exempt Network Averages, 2023):

Network	Avg. Fee (% of Transaction Value)
ACCEL	0.56%
AFFN	0.60%
ATH	0.46%
Culiance	0.55%
Interlink	0.60%
Jeanie	0.51%
Maestro	0.58%
NYCE	0.70%
PULSE	0.63%
SHAZAM	0.64%
STAR	0.51%
UnionPay	0.91%

Signature Debit

Signature debit — or “running debit as credit” — bypasses PIN debit networks and instead routes through the Visa, Mastercard, Discover, or Amex networks. Instead of a PIN, the customer signs (or enters a CVV online).

Because these payments run on the credit card networks, the fees look more like credit card interchange: higher percentage-based charges, but usually lower fixed per-transaction fees. On average, here’s what you can expect:

Type of Transaction	Avg. Fee (% of Transaction Value)
Covered PIN	0.61%
Covered Signature	0.56%
Exempt PIN	0.67%
Exempt Signature	1.41%

How To Avoid Overpaying For Debit Card Transaction Fees

To avoid overpaying for debit card transaction fees, you’ll need to create a strategy that works for your business. Here are a few dos and don’ts to get you started:

Do:

Use a PIN pad for your countertop terminal. Without a PIN pad, all of your debit card transactions will run as credit, which means higher processing rates.
Pick the right PIN debit network. Since rates vary between networks and types of transactions, you’ll want to choose a network that processes your types of transactions at a lower rate. Remember to also minimize switch fees and annual fees when possible.
Use Interchange Plus or Membership pricing. These plans can help your business save money. Start your search with our top picks for the best credit card processors.
Add a convenience fee to debit card purchases. Offset some of the high authorization fees on small-ticket debit card sales by adding a fixed convenience fee to each transaction,

Don’t:

Use tiered pricing. Tiered pricing ignores the differences between PIN debit and credit card interchange fees, so all of your debit card transactions will cost as much as credit cards, even if you use a PIN pad.
Consider flat-rate pricing. Popular payment service providers (PSPs) like Square and PayPal offer flat-rate pricing but don’t charge monthly or annual fees. This can be a fair tradeoff if you’re just getting started or have a low monthly processing volume.
Set a minimum purchase amount for debit cards. While you can set a minimum purchase amount that applies to credit cards only, it is illegal to do so for debit cards.

Are Debit Card Fees Worth It?

For most merchants, debit cards are absolutely worth it. With most U.S. debit transactions capped under Durbin, they’re cheaper than credit—and with the right processor and setup, you can keep your costs even lower.

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Erica Seppala

Editor & Senior Staff Writer at Merchant Maverick

Erica has been writing about small business finance and technology since 2008. She joined Merchant Maverick in 2018 and specializes in researching and reviewing business software, financial products, and other topics to help small businesses manage and grow their operations. Her expertise has been cited in MSN, Reader's Digest, Vox, U.S. News & World Report, and Real Simple. She is a Certified ProAdvisor for QuickBooks Online and QuickBooks Payroll, a graduate of Limestone University, and currently resides in Greenville, South Carolina.

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