Card Machine Fees Explained: Interchange, Scheme Fees and Acquirer Margin

LAST REVIEWED 2026-09-06

What do UK businesses actually pay per card payment?

This total is built from three layers: interchange (capped at 0.2% for debit and 0.3% for credit), scheme fees set by Visa and Mastercard, and the acquirer's margin. The table below shows published rates from major providers as of 2026.

Interchange is the largest single component but is capped by regulation. Scheme fees are set by card networks and vary by card type and transaction. The acquirer margin covers processing, risk, and customer service. Providers may present these as a single 'blended' rate or itemise them as 'interchange plus plus'.

To see what a business pays, look at the rate applied to each transaction. The actual breakdown depends on the card used and the provider's pricing structure.

How do interchange fees work and what are the caps?

Interchange is the fee paid by the acquirer to the cardholder's bank. Under the Interchange Fee Regulation, caps apply: 0.2% for consumer debit cards and 0.3% for consumer credit cards. These caps have been in force since December 2015 and remain in 2026. The Interchange Fee Regulation in the UK: The 0.2% and 0.3% Caps Explained provides further detail.

Premium cards like Amex also have higher interchange. The caps apply to transactions within the European Economic Area, but the UK has retained similar caps post-Brexit.

These amounts are small, but they form the base of the fee stack.

What are scheme fees and how much do they add?

Scheme fees are charged by Visa and Mastercard for using their payment networks. They are separate from interchange and are not capped by regulation. Scheme fees vary by card type, transaction type (in-person, online), and whether the card is consumer or commercial. They typically add a fraction of a percent to the total cost.

These fees are set by the networks and are passed through by acquirers. In an interchange-plus-plus pricing model, scheme fees are shown separately.

Businesses should check their fee statement to see if scheme fees are itemised. In a blended rate, they are included in the headline percentage. The exact amount depends on the network and card product.

What is the acquirer margin and why does it vary?

The acquirer margin is the amount the payment processor charges above interchange and scheme fees. It covers the cost of providing the terminal, fraud prevention, customer support, and profit.

Providers with no monthly fee, such as SumUp and Zettle, often have higher per-transaction margins. Others, like Barclaycard, may charge a monthly fee but offer lower transaction rates. The table below shows that SumUp charges 1.69% with no monthly fee, while Zettle charges 1.75% with no monthly fee.

Comparing the total cost, including monthly fees and any hidden charges, is essential.

What is the difference between blended and interchange-plus-plus pricing?

Blended pricing charges a single rate for all transactions, such as 1.69% or 1.75%. Interchange-plus-plus pricing itemises the costs: interchange (actual cost), scheme fees (actual cost), and a fixed acquirer margin. The Blended vs Interchange Plus Plus Card Pricing: Which Costs Less guide explains the trade-offs.

Blended rates are simpler but can be more expensive if a business accepts many premium cards. Interchange-plus-plus is transparent but requires understanding the fee components. For a small business with mostly consumer debit cards, a blended rate may be cost-effective.

The difference is significant.

What hidden line items should businesses look for?

Beyond the transaction rate, providers may charge for PCI compliance, authorisation fees, minimum monthly service charges, and terminal rental. PCI DSS v4.0 has been the only active version since March 2024, and non-compliance can incur fees. Some providers charge an annual PCI fee, while others include it.

Authorisation fees are per transaction, often a few pence. Minimum monthly service charges apply if your turnover is low. Terminal rental can be £20.00 per month or more. The table shows Worldpay charges £20.00 per terminal monthly, while Barclaycard charges £0 for 12 months then £18 plus VAT.

Businesses should read the full fee schedule. For example, a provider might advertise a low rate but add a £29 monthly fee. Always calculate the total cost based on your actual transaction volume and average ticket size.

How can a business read a fee summary box effectively?

Since July 2023, the Payment Systems Regulator requires providers to offer summary boxes, trigger messages, and online quotation tools. These tools help businesses compare costs. A summary box should show the transaction rate, monthly fees, contract length, and any other charges.

When reading a summary box, check the rate for in-person consumer debit cards, as that is the most common transaction. Also note the monthly fee and whether it is waived for a period. For example, Barclaycard offers £0 for 12 months, then £18 plus VAT.

Look for the contract length. The PSR capped new POS terminal lease contracts at 18 months. Providers like takepayments require a 12-month contract, while SumUp and Zettle have no contract. Settlement times vary: Zettle settles within minutes to PayPal, while others take next day.

What are the typical costs for accepting Amex and premium cards?

Amex and premium cards often have higher interchange rates because they are not subject to the same caps. Accepting these cards can increase your effective rate.

Providers may charge a higher blended rate for Amex transactions, or they may be included in the standard rate. The Accepting Amex and Premium Cards: What UK Businesses Pay article explains the specifics.

For a business that accepts many premium cards, the average cost per transaction will be higher than the headline rate. It is important to understand the mix of cards your customers use. Some providers allow you to surcharge for Amex, but this is subject to rules.

How do refunds and chargebacks affect card machine fees?

When a refund is issued, the transaction fee is typically reversed, but the interchange and scheme fees may not be fully refunded. Some providers charge a fee for processing refunds, while others do not. Chargebacks, where a customer disputes a transaction, incur a fee that can be significant.

These fees are not published in the table but are outlined in the provider's terms. Businesses should ask about refund and chargeback policies before signing up.

To minimise costs, process refunds promptly and keep clear records to dispute chargebacks. The Financial Ombudsman Service can handle disputes, and from April 2026 its award limit rises to £455,000 for acts on or after 1 April 2019.

Glossary: card payment terms explained

Interchange: A fee paid by the acquirer to the cardholder's bank for each transaction. Capped at 0.2% for consumer debit and 0.3% for consumer credit cards.

Scheme fee: A fee charged by card networks like Visa and Mastercard for using their payment infrastructure. Not capped by regulation and varies by card type.

Acquirer margin: The amount a payment processor charges above interchange and scheme fees to cover its costs and profit. This varies between providers.

Blended rate: A single percentage rate applied to all transactions, bundling interchange, scheme fees, and acquirer margin. Simpler but may be less transparent.

Interchange-plus-plus: A pricing model that itemises interchange, scheme fees, and a fixed acquirer margin separately. Offers transparency but requires understanding of components.

PCI DSS: Payment Card Industry Data Security Standard. Version 4.0 has been the only active version since March 2024, requiring compliance from all businesses handling card data.

Checklist: what to check on a fee statement or contract

• Check the published rate for in-person consumer debit cards, as it is the most common transaction type.
• Identify any monthly fee, such as £20.00 per terminal, and whether it is waived for an initial period.
• Confirm the contract length, ensuring it does not exceed 18 months for POS terminal leases.
• Ask if the rate is blended or interchange-plus-plus, and request a sample fee breakdown.
• Review the settlement time, as some providers offer next-day settlement while others take longer.
• Look for hidden fees like PCI compliance, authorisation, or minimum monthly service charges.

Each item above maps to a line that must appear in the PSR summary box or the contract schedule, so a missing entry is itself a question for the provider.

Frequently asked questions

What is interchange?

Interchange is a fee paid by the acquirer (the payment processor) to the cardholder's bank for each transaction. It compensates the bank for issuing the card and assuming risk. In the UK, interchange is capped by the Interchange Fee Regulation: 0.2% for consumer debit cards and 0.3% for consumer credit cards. These caps have been in effect since December 2015 and remain in 2026. Interchange is a major component of the total card acceptance cost, but it is not the only one.

Why do I pay more than 0.2% if interchange is capped?

The 0.2% cap applies only to interchange for consumer debit cards. The total fee you pay also includes scheme fees set by Visa and Mastercard, and the acquirer's margin. Scheme fees are not capped and can vary. The acquirer margin covers processing, fraud prevention, and profit. When you see a blended rate like 1.69% or 1.75%, it includes all three components.

What is a blended rate?

A blended rate is a single percentage applied to all transactions, regardless of card type. It bundles interchange, scheme fees, and acquirer margin into one figure. For example, SumUp charges 1.69% and Zettle charges 1.75%. Blended rates are simple to understand but may not reflect the actual cost of each transaction. If you accept many premium cards, a blended rate could be higher than interchange-plus-plus pricing, which itemises costs.

Are commercial cards capped?

No, commercial cards (such as corporate credit cards) are not subject to the interchange caps. The caps apply only to consumer debit and credit cards. Some providers charge a higher blended rate for commercial cards, or they may be included in the standard rate. It is important to know the mix of cards your customers use to estimate your effective rate.

Do I pay fees on refunds?

When you issue a refund, the transaction fee is typically reversed, but you may still incur costs. Some providers charge a separate fee for processing refunds, while others do not. Additionally, interchange and scheme fees may not be fully refunded. Chargebacks, where a customer disputes a transaction, incur a fee that can be significant. Always check your provider's terms for refund and chargeback policies to avoid unexpected costs.