When it comes to payment processing, most business owners know they’re paying something to accept cards, but they’re often unclear on exactly how those fees are calculated—or if they’re even on the right plan.
The truth is, the way your account is priced can make a big difference to your bottom line. Pick the wrong model, and you could be quietly losing thousands a year. Pick the right one, and you keep more of every sale where it belongs—in your business.
Let’s break down the main pricing models in the industry, how they work, and why at True North Payments we believe choosing the right one is the only way to help both you and us grow.
The Three Main Pricing Models
While processors use all sorts of names and packages, most merchant accounts are set up under one of these models:
1. Flat-Rate Pricing
You pay the same percentage and per-transaction fee no matter what card your customer uses.
- Pros: Simple, predictable, easy to read on a statement.
- Cons: Often more expensive for larger or higher-volume businesses, since you’re paying the same rate on every sale, even the cheapest ones to process.
- Best for: Low-volume businesses, startups, seasonal sellers.
2. Tiered (or “Bundled”) Pricing
Transactions are grouped into categories—Qualified, Mid-Qualified, and Non-Qualified—each with its own rate.
- Pros: Can seem attractive if most of your transactions fall into the “Qualified” bucket.
- Cons: Lack of transparency. Many businesses pay higher rates for common card types without realizing it.
- Best for: Merchants with a very specific card mix that consistently lands in the lower-cost tier (rare).
3. Interchange-Plus Pricing
You pay the true interchange fee (set by the card networks) plus a fixed markup from your processor.
- Pros: Transparent, scalable, and often the cheapest for established or growing businesses. You see exactly what’s going to the card brands and what’s going to your processor.
- Cons: Statements can look a bit more complicated at first glance.
- Best for: Medium-to-high-volume merchants, especially those with varied transaction types.
Why This Matters More Than You Think
Every business processes payments differently. The mix of card types, ticket sizes, and transaction methods you use will directly impact which model saves you money.
A retail shop with lots of small-ticket debit card sales will benefit from a completely different structure than an e-commerce store selling high-ticket items across state lines.
The True North Approach
At True North Payments, we don’t believe in one-size-fits-all pricing. In fact, we believe the only acceptable way to grow is by helping our clients grow, and that starts with putting you on a processing model that makes sense for your business.
Here’s how we do it:
- We learn your business. Your products, your customer base, your average ticket size, and how you accept payments all matter.
- We analyze your transaction data. If you have past processing statements, we break them down to spot cost-saving opportunities.
- We match you to the right pricing model. Whether it’s Flat-Rate, Interchange-Plus, or something hybrid, we choose the option that keeps the most money in your pocket.
- We stay proactive. As your business grows or changes, we revisit your setup to ensure you’re always on the most cost-effective plan.
The Bottom Line
Your payment processing shouldn’t be a mystery—and it shouldn’t be draining your profits without you knowing why.
By understanding pricing models and working with a processor who aligns their success with yours, you’ll not only process payments — you’ll process them smarter.
True North Payments is here to guide you through the complexity and set you on a course for growth. No smoke, no mirrors—just honest, transparent pricing that works for you.
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