What Is Flat-Rate Processing?

Flat-rate credit card processing makes it easy to accept payments. Instead of juggling multiple fees for different card types, you’ll pay one consistent transaction fee for each type of sale.

In this guide, we’ll cover how flat-rate pricing works, what it costs, and when it makes sense for your business.

What Is Flat-Rate Credit Card Processing?

With flat-rate pricing, interchange fees, card network assessments, and the processor’s markup are bundled into a single transaction rate. You’ll pay the same fee for all transactions of the same type, whether a Visa, Mastercard, or other card is used.

Flat rate pricing is:

• One consistent rate per transaction type
• Simple and predictable
• Usually available without a long-term contract

Flat rate pricing isn’t:

• A single universal rate for every transaction
• Always cheaper than interchange-plus pricing

You may pay different flat rates for in-person vs. online transactions, but each rate is consistent within its category.

How Flat-Rate Card Processing Works

Flat-rate processing combines all fees into a single, simplified transaction fee. Typical rates look like this:

Here’s what this would look like in practice:

• $20 in-person transaction at 2.6% + $0.15 = $0.67 fee
• $20 online transaction at 2.9% + $0.30 = $0.88 fee
• $20 keyed-in transaction at 3.5% + $0.15 = $0.85 fee

Which Payment Processors Use Flat-Rate Pricing?

Flat-rate credit card processing is most common with third-party payment processors, also called “payment service providers.” These processors commonly offer pay-as-you-go plans without monthly account fees, although optional software, hardware, and advanced features may cost extra.

Some popular flat-rate processors include:

• Square
• Stripe
• PayPal

Flat-rate pricing is most common among payment service providers, but some traditional merchant account providers, including National Processing, also offer flat-rate plans.

What’s Included In Your Flat-Rate Fee?

Most flat-rate processors include:

• Interchange and card network fees
• The processor’s transaction markup
• Basic fraud-monitoring tools
• Basic payment software
• Payment gateway access for applicable online transactions

You may still pay extra for:

• International cards and cross-border transactions
• Currency conversion
• Advanced software or optional features
• Chargebacks
• Instant transfers
• Hardware and cellular connectivity
• Refund-related costs or retained processing fees

Many flat-rate processors do not require long-term contracts or charge early termination fees. However, businesses should check for separate commitments tied to hardware financing, equipment leases, or paid software plans.

Average Flat-Fee Processing Rates

Standard flat-rate card processing commonly ranges from about 2.5% to 3.5% of the transaction, plus a fixed fee that often ranges from $0.10 to $0.50.

Card-present transactions tend to fall toward the lower end of these ranges, while online and manually entered transactions generally cost more because they carry a higher risk of fraud.

Are Flat-Rate Merchant Services Cheaper?

Flat-rate pricing is often more expensive than interchange-plus pricing per transaction. You’re paying for simplicity and predictability, not just the lowest possible processing cost.

Here’s how it breaks down:

When To Use Flat-Rate Processing

Flat-rate processing can make sense if you:

• Own a very small or new business
• Run a side gig or seasonal business
• Want a predictable, easy-to-understand fee
• Prefer to avoid monthly account fees
• Value quick approval and simple setup

Flat-rate pricing eliminates most merchant account fees, and the month-to-month setup makes it easy to switch to a full-service merchant account when your business grows.

Whether you stick with flat-rate pricing or explore other models, check out our picks for the best credit card processors for small businesses to find your best fit.