Payment Processing

Guide to Credit Card Processing for eCommerce

Understanding all the different facets of credit card processing might be challenging, especially if you’re just starting out.

You’re not alone. When selecting a payment gateway and understanding all the various processing fees, many business owners feel overwhelmed.

Even if you’ve been operating your e-commerce company for some time, keeping up with the most recent developments in payment processing is crucial.

A reliable payment partner is essential because fees and rules might change anytime.

This article will cover everything you need to know about processing credit card payments. Dive deep into payment gateways, the common payment processing fees, and how Von Payments can help your e-commerce business succeed.

How Does Credit Card Payment Processing Work?

A good grasp of how credit card payment processing works is essential if you want to accept this form of payment for your e-commerce business. The process of credit card processing companies can seem complicated on the surface, but it doesn’t have to be.

The first step for any e-commerce company is to get a merchant account—a bank account that enables you to accept online payments from customers using their debit or credit cards.

When applying for a merchant account, you must provide information such as the following:

  • Your business name and address
  • What type of goods or services you’re selling
  • Your estimated monthly sales volume
  • Other details like fees, rates, and terms associated with your account

Once approved, the acquiring bank will set up your merchant account—enabling you to authorize, capture and deposit online and mobile payments into your designated bank account. 

This is done by connecting all these components using the right technology, such as payment gateways, virtual terminals, and secure checkout solutions.

When customers enter their payment details at checkout on e-commerce platforms or mobile apps, the data is sent from the gateway or terminal directly to the customer’s issuing bank, where it is checked for authenticity.

The payment processor executes the transaction and transfers funds into your designated bank account.

To ensure that payments are processed quickly and efficiently, merchants must adhere to specific standards such as Payment Card Industry or PCI compliance guidelines. 

These set rules around storing and handling customers’ data and ensure end-to-end encryption throughout the payment process.

Using a Payment Gateway to Help with Credit Card Processing

A payment gateway is an added layer of security and helps merchants process credit card payments efficiently.

The payment gateway serves as an intermediary between the customer and the e-commerce store, ensuring safe and reliable online transactions.

A gateway allows customers to make secure e-commerce payments directly on your online store without being redirected to another page; customers don’t have to leave your site to complete their purchases.

Typically, when a customer wants to purchase something online, the payment gateway verifies their identity and checks if their credit card information is correct. It also collects data from the issuing bank to determine whether the transaction is approved or declined.

Furthermore, it encrypts sensitive data such as credit card numbers and personal information for extra security measures. 

As a result of these highly secure practices, customers can feel safe when making online purchases on websites that use a payment gateway for their transactions.

A payment gateway provides an invaluable asset for online stores by cutting down on fraud risk and increasing consumer confidence in your business.

Common Credit Card Processing Fees

When processing payments with credit cards, there are various fees that businesses should be aware of. These fees can vary depending on the payment processor and the type of services used.

Standard fees for credit card processing include transaction fees, gateway fees, interchange rates, statement fees, and assessment fees. Other less common fees may also include setup fees, termination fees/cancellation fees, etc.

Transaction Fees

Transaction fees are the most common fee associated with credit card processing.

Usually, a flat fee per transaction or interchange plus pricing is applied for each sale processed through the payment processor. This fee covers securely transferring funds from the customer’s bank account to the vendor’s account.

Transaction fees typically range from 0%–5% depending on the processor and services used.

Gateway Fees

Gateway fees are typically charged when using an external payment gateway such as PayPal or Stripe to process payments online.

Gateway fees are usually calculated as a flat monthly rate plus a small percentage per transaction and typically range from 1%–3.5%.

Interchange Rates

Interchange rates refer to what is known as “swipe” or “card-present” transactions and involve customers swiping their cards at point–of–sale terminals (POS).

These are standard payment processing charges assessed by a merchant’s chosen processor whenever they accept payments via debit or credit cards.

Visa, Mastercard, and other credit card companies set interchange fees. They typically range from 1–3.5% of each completed transaction, specifically as follows:

  • Visa: 1.4% to 2.5% for credit cards and .05% for debit cards
  • MasterCard: 1.5% to 2.6% for credit cards and .05% for debit cards
  • American Express: 2.3% to 3.5% for credit cards and .05% for debit cards
  • Discover: 1.55% to 2.5% for credit cards and .05% for debit cards

Statement Fees

Statement Fees are charges that may appear on your monthly statement for each month you accept payments via credit card.

Many credit card processors offer discounts if you sign up for auto-billing or commit to transactions above a certain amount each month. However, some processors may still charge statement fees regardless if these conditions are met.

Statement fees usually range anywhere from $5–$30/month, depending on the services used.

Assessment Fees

Assessment fees refer to extra charges imposed by card issuers that cover costs associated with maintaining fraud prevention systems, processing card networks, etc.

They generally amount to around 0.11%–0.13% per transaction, regardless of whether it was conducted online (card-not-present) or by swiping at POS terminals in-store.

Chargeback Fees

Chargeback fees are another type of fee that businesses may encounter when using a credit card processor. 

This fee is charged to merchants when customers dispute an unauthorized or fraudulent transaction on their statement and request a refund from their credit card issuer.

The chargeback fee covers any associated costs incurred by the merchant’s processor in handling this dispute process and typically ranges from $15-$50, depending on the issuing bank or financial institution. 

Authorization Fees

Authorization fees cover any expenses related to verifying a customer’s identity information when making purchases with credit cards or ACH payments via automated clearing house networks like PayPal or Venmo.

Authorization fees generally range between $0.05–$0.20 per transaction, depending on which service provider is used for authentication purposes.

Some providers charge even higher rates for businesses operating in more high-risk industries, such as gaming or adult entertainment businesses.

Some processors may also assess additional flat-rate authorization fees if specific criteria, like online purchases over a certain value amount, are met by customers making transactions with their cards at point-of-sale locations. 

Subscription Fees

Subscription fees are typically associated with payment gateways or merchant accounts that require a business to sign up for an ongoing subscription agreement to access its services.

Subscription fees vary depending on the service provider, but they usually range from $20–$200 monthly fees depending on features available and the types of transactions being processed.

How Much are Payment Processing Fees?

Depending on the payment processor they choose, e-commerce credit card processing can come with various fees.


Stripe charges a 2.9% + $0.30 fee per successful credit card charge. This fee applies to online and in-person transactions for Visa, Mastercard, American Express, Discover, and other supported payment options.

Stripe also charges a 1.5% fee for international payments such as Google Pay or Apple Pay.


PayPal has similar payment processing fees with a couple of differences. They charge a flat 2.99% + $0.49 fixed fee per successful credit card charge with an additional 1.5% per transaction when using PayPal’s currency conversion service (if applicable).

There may also be other costs when using PayPal’s merchant services, like accepting QR code transactions or Venmo payments.


Square offers a competitive pricing structure with their flat 2.6% + $0.10 fee per successful credit card charge plus an additional 1.5% if you use their instant transfers functionality—allowing merchants to receive funds within minutes instead of days.


Shopify offers tiered pricing models that vary based on what features you need from the platform and what type of product you’re selling (eCommerce store or retail shop).

The basic plan (which is ideal for small businesses or those with low volume sales)  starts at 2.9% + $0.30 fee per successful credit card charge along with an additional 0-2% depending on whether your customers check out through Shopify. 

Payments or another third-party processor such as Stripe or Paypal (note: this does not apply for brick-and-mortar stores).

Higher-tier plans offer lower rates. They go from 0% to 1%, which is better for high-volume e-commerce businesses that process thousands of orders each month and want to save on transaction costs.

Von Payments Can Help With Credit Card Processing for Your e-Commerce Businesses

Credit card processing services include authorizing, clearing, and settling payments, which are all crucial elements of running a successful online business.

If your business needs a reliable way to process credit cards, you should consider partnering with Von Payments for merchant accounts and streamlined payment processing services.

Von Payments offers PCI-compliant payment gateways and uses tokenization technology to ensure secure credit card transactions. Von Payments also provides fraud prevention tools to help protect businesses from unwanted chargebacks or fraudulent activity.

Our payment solutions are designed to be user-friendly, with easy API integrations into existing payment systems so your business can run seamlessly and without extra hidden fees.

With these features in mind, it’s no surprise that many businesses trust Von Payments as their merchant services provider—with reliable credit card processing solutions for eCommerce stores.

Contact us today to learn more.