The Complete Guide To Card Brand Fees For Merchant Accounts

Card brand fees are what credit card companies like Visa, Mastercard, American Express, and Discover charge for their services every time a credit card is used. They may also be called card association fees, card network fees, or card assessment fees. These fees comprise a part of wholesale fees you have to pay to take card payments at your business.

Let’s take a closer look at card brand fees charged by credit card associations.

What Is A Card Brand Fee?

Card brand fees, or card assessment fees, are fees charged by credit card associations on credit card transactions. Card brand fees are typically either a percentage of volume charged or a flat amount per instance.

Some card brand fees apply to all your transactions, while others only apply in very specific situations, such as when an authorization is abnormal in some way.

Yet others relate simply to sending card processing data through the card association’s computer network, such as FANF (Fixed Acquirer Network Fee, specific to Visa) and NABU (Network Access and Brand Usage fee, specific to Mastercard).

On average, card brand fees represent about only 0.13-0.15% of a merchant’s total processing fee on any given transaction. Interchange fees and your processor’s markup will represent the bulk of your credit card processing fees, with each typically taking another 1-3% of each sale.

Card Brand Fees vs Interchange Fees

You’ve probably also heard of another type of fee — the interchange fee — before coming across this article. Many merchants are surprised to learn that interchange fees and card brand fees are two separate things.

The reason for this confusion is that both types of fees are considered part of the “wholesale” cost of card processing, as opposed to the “markup.”  The only difference between interchange fees and assessment fees is that interchange fees are paid to the card’s issuing bank, while the assessment fees are paid to the credit card associations.

Card brand fees have set, established amounts across the industry. Like interchange fees, they’re considered non-negotiable, and the processor has no control over the amounts. The bad news is that finding the true wholesale amounts for card brand fees is generally more difficult than looking up interchange rates.

You can find average card association fees and interchange fees in our complete guide to credit card processing fees and rates.

Why Credit Card Association Fees Are A Pain For Merchants

Due to several regrettable quirks of the processing industry, card brand fees are particularly complicated and opaque. Here are the primary reasons:

• They’re not displayed on the card brand websites. By contrast, interchange tables are readily available on the Visa and Mastercard websites.
• You can’t call the card brands and ask about the fees. You’ll be redirected right back to your merchant service provider (MSP) to answer any questions. It’s incredibly frustrating that we can’t rely on the card brands to disclose these base costs, and instead must rely on processors and MSPs to be honest when they pass the fees through.
• Multiple fees may apply to the same authorization or transaction. For example, transactions paid with a foreign-issued card incur separate international surcharges on top of the regular assessment that’s applied to all your transactions.
• The fees change (and usually increase) over time. And not all at once. While they’re rarely decreased, sometimes particular fees are eliminated and/or replaced with others. Occasionally, a completely new fee is instituted.
• Many of the fees are known by multiple names and abbreviations, and it’s often difficult to match the names on your own merchant account statement with any established names.
• Two or more fees may be combined into one on your merchant account statement, making them hard to identify and verify.
• The fees can be spread throughout multiple sections of your statement — not grouped together or even labeled properly. Often, they are buried inside “interchange” or “authorization” sections.
• Brazen processors or MSPs may add their markups to card brand fees without telling you. Or they may invent fees and give them card-brand-sounding names.
• Most of the fees are small, so they can be overlooked as inconsequential. They can still add up quickly, but the real issue at stake is the overall honesty and transparency of your provider. Regardless of whether an extra fee or markup here and there isn’t costing you that much, wouldn’t you rather know about it?

How To Keep Track Of Assessment Fees Amid All The Other Credit Card Merchant Fees

There is no question that these assessment fees are difficult to keep track of. There is, unfortunately, no easy shortcut. We do, however, suggest the following tips for navigating these fees:

1. Be aware that you may be charged only some, or even none, of these fees. This depends on several factors, including 1) your pricing model, 2) what your MSP decides to pass through instead of absorbing, and 3) what happens with your transactions and authorizations in a given month. With many blended, tiered, or flat-rate plans, all or most of the card brand fees are absorbed into the overall cost of your account instead of itemized and passed through to you. There are no guarantees with any pricing model, however, so check your statements anyway!
2. Obtain a list of card brand fees from your merchant account provider. If they’re passing these fees through to you, they should provide a detailed list with the specific names and abbreviations they’re using.
3. Use a secondary, neutral source to confirm fee amounts. Our list below is a great place to start.
4. Keep a running list of the card brand fees you’ve seen on your own statements, along with the amounts. Reference lists are handy, but a personalized list is easier to use and track over time than a litany of every possible fee for every possible circumstance.
5. Processors shouldn’t mark up these fees without clearly informing you. And really, they should leave these fees alone completely. If the fee is charged at all, it should be passed through at cost.
6. Trust the amount more than the name. Identifying a fee on your statement is often more about looking at the rate or amount charged, as well as the specific number/volume/type of transactions to which it was applied. The process of elimination can be very effective here.
7. Be suspicious if you spot extra fees that aren’t on the reference list, any that seem like duplicates or that can’t be matched with established values, or those that look too high. Don’t worry too much if a fee seems too low; it’s possible your processor is just absorbing or redistributing some of the cost.
8. Be on the lookout for fee change notifications. October and April are common transition points, but the fees can change at any time. Good processors will notify you (sometimes on the statement itself) when a card brand fee is set to increase or change. If your processor doesn’t fall in this camp, it’s all the more important that you bookmark this article.
9. Ask before you sign. If you’re just now signing up for an MSP or changing providers, ask how it handles card brand fees in addition to interchange costs. Be very clear that you know the difference and want the specifics. Remember, not all customer service reps are created equal in their knowledge of this topic. Ask to be transferred up the chain if you’re not satisfied.

Reference List For Card Brands & Respective Assessments

Note that some of the lists we used as references to compile our list below contain more items. The card associations often like to break their charges by domestic vs. international in some way, so sometimes we leave out the international charge. Other times, our reference lists do not agree on the itemized name or amount, or some items appear on some lists but not others. When we can’t verify the item, we leave the item off the list.

So What Do I Do With All This Information About Assessment Fees?

If you accept credit cards, card association fees are a necessary evil, just like interchange fees.

As we mentioned earlier, card brand fees are difficult to verify because they change and they’re not often publicly disclosed.

Ultimately, however, card brand fees will not comprise a big part of the total credit card processing fees you pay as a small business. Interchange fees and your processor’s markup will represent a much larger share of the total fees you pay. 

Looking for a processor that doesn’t overcharge? Check out our list of the best credit card processing companies for small businesses.