What Rising Card Fees Mean for Small Businesses

Pull up your last card processing statement, then find one from a year ago and put them side by side; odds are the numbers won't match, not in your favour, at least. Here's the cold, hard truth: card fees have been quietly rising for years for businesses across the US, UK and EU. Neil McDonnell, chief executive of the Irish SME association ISME, has confirmed that interchange fees and other banking charges have become an ongoing problem for Irish businesses, with one Irish business reporting its annual interchange bill rocketing from €171,000 to €400,000 in a single year.

If you run a small business, this is more than just background noise. Card fees are one of those costs that rarely get their own line in the budget; they just sit there in the background, nibbling away at your margin on every single sale. And because they're usually a percentage of the transaction rather than a flat number, they scale up right alongside your success. The busier you get, the more you pay, which is a strange kind of cost to have so little control over.

So let's actually unpack what's going on: why fees keep rising, what's actually in that percentage you're being charged, and what a small business can realistically do about it.

What's actually in a "card fee"?

When we talk about card fees for a small business, what does that actually mean in practice? Usually, this fee encapsulates three separate things, all lumped together as one number:

• Interchange fees: This goes to the bank that issued the customer's card, not to your payment processor. In Ireland, this part is actually capped by law at 0.2% for consumer debit cards and 0.3% for consumer credit cards, under the EU Interchange Fee Regulation. That's genuinely good news, since it means the biggest single component of your card fee can't just be raised at will. Our guide on what credit card processing fees actually are breaks this down further if you want the full picture.
• Scheme fees: This fee is charged by the card networks themselves (Visa and Mastercard) for the use of their infrastructure. Unlike interchange, scheme fees are not capped by regulation on business-to-business payments, and this is where most of the recent upward pressure has actually come from. ISME reports that its members are typically paying €5,000 to €10,000 a year in interchange and related charges, just as part of the ordinary cost of doing business. These fees are also rarely itemised clearly on a typical statement, making them one of the hardest costs to actually track down.
• Acquirer markup: This is the part your payment processor or POS provider adds on top for themselves. Out of the three fees, it's the only one you can actually negotiate, since this markup is entirely down to your provider. Ireland's Competition and Consumer Protection Commission (CCPC) actively reminds businesses that financial service pricing, including this markup, is negotiable, and rewards active comparison between providers. If you're comparing options, Epos Now's guide to choosing a card machine explains exactly how this part of the pricing works, most Irish providers charge a flat 1.5% to 1.75% per transaction, with Epos Now's own devices sitting at a flat 1.5% on Visa and Mastercard.

So there you go! Add up all three, and you get your effective rate: the real, all-in percentage you're actually paying once every fee is added together and measured against your total card takings. Irish retail businesses typically see effective rates between 0.3% and 0.9%, according to Banking & Payments Federation Ireland data, while hospitality businesses, restaurants, cafés, bars, and hotels, tend to sit higher, often between 1.6% and 2.1%, since they process more card-not-present and international tourist card payments.

Why do card fees keep going up?

Ah, that's the million-euro question, right there. To answer this, it's important to understand that a few different things are happening at once, so don't just assume your processor is the only one to blame. Here's what's going on:

• Scheme fees keep climbing, even where interchange doesn't: Because scheme fees on business card payments fall outside Ireland's interchange cap, Visa and Mastercard set them largely unchecked, and with limited real competition forcing prices down, they've kept raising them, often through small, easy-to-miss additions rather than one obvious hike. It's the single biggest reason Irish card costs keep climbing, even though interchange itself has barely moved since 2015.
• Cross-border transactions cost noticeably more since Brexit: Yep, Brexit's got a hand in this one too. UK-issued cards are now treated as non-EEA on the Irish side, and the European Commission's binding agreement with Visa and Mastercard caps these inter-regional rates at 1.15% for debit and 1.50% for credit on online transactions, around five times the domestic capped rate. If you take a decent volume of online payments from UK customers, you've likely felt this. The good news is that, unlike the UK's own unregulated situation, this rate is capped under a formal EU Commission commitment that Visa and Mastercard have agreed to hold until November 2029.
• Card habits are changing: More customers are paying with commercial cards (business cards, like company credit cards), premium cards (rewards or cashback cards), or cards issued outside Ireland. Since these all sit outside the standard consumer caps, they simply cost more to process. Which means the average cost of accepting cards keeps creeping up across the whole industry, even if nothing about your business has changed at all.
• Almost none of these extra costs get absorbed anywhere else: When Visa, Mastercard, or the banks raise their fees, research suggests around 95% of that increase gets passed straight through to the business accepting the card, rather than being eaten by your payment provider along the way. So when the wholesale cost goes up, it reliably shows up on your statement too, not just somewhere further up the chain.

It's worth pointing out that it's unlikely that these costs will simply continuously rise. Central Bank of Ireland data shows average payment processing costs across Irish businesses actually fell by 0.12% in 2024, attributed to increased competition and regulatory pressure, with further reductions expected. While no one can accurately predict the future, you shouldn't assume that costs will always rise exponentially.

What can small businesses actually do about it

The good news is that you're not entirely at the mercy of rising fees, and there are things you can do to help take control. Here are a few of our tips:

• Actually read your statements: This seems simple and obvious, but the fact is, a huge number of businesses never compare their current processing statement to one from a year ago. Pull both out, and look specifically at your effective rate (total fees divided by total card volume), not just the headline percentage you were quoted when you signed up. It's often the only way to actually spot a creeping increase before it's cost you hundreds of euros, since these hikes rarely arrive as one obvious jump; they build up quietly, fee by fee.
• Know which part of your fee is actually negotiable: There's no point arguing over something nobody can change. Interchange is fixed by law, so that's off the table. Scheme fees are set by Visa and Mastercard, so your provider can't move those either. But the markup your provider adds on top for themselves? That's entirely down to them, and it's the one part actually worth having a conversation about. Enterprise Ireland advises that small businesses processing more than €10,000 a month should prioritise negotiating this rate, since even a 0.1% reduction can add up to meaningful annual savings.
• Ask for a rate review, especially if you've grown: If your transaction volume has increased since you first signed up, you have more leverage than you might think. Processors would generally rather renegotiate than lose a growing customer.
• Watch out for cross-border exposure: If a meaningful share of your customers are paying with UK-issued cards, it's worth understanding how much of your effective rate that's adding, since this is one of the fastest-growing cost categories for Irish businesses right now.
• Watch out for hidden fees: PCI compliance charges, statement fees, batch fees, and various "reporting" charges can all quietly pad your bill without adding any real value. Some are legitimate, some are closer to padding. It's worth asking your provider to explain every line item you don't recognise.
• Consider whether your POS and payments are properly integrated: A lot of hidden cost and hidden friction comes from stitching together a till system and a separate card machine that don't talk to each other properly. A single, integrated system that handles POS and payments together tends to offer clearer, more transparent pricing, and removes a layer of manual error and reconciliation hassle at the same time. Epos Now Payments: The Complete Guide covers what to actually look for in an integrated setup.

The bottom line

Card fees aren't going away, and the uncapped parts, scheme fees especially, are the ones most likely to keep climbing. But rising doesn't have to mean invisible. The businesses that come out ahead aren't the ones who found some loophole; they're the ones who actually understand what they're paying, push back on the parts they can, and pick providers who don't bury the pricing in fine print, Epos Now being a good example of what that kind of transparency actually looks like.

Your card fees are one of the few genuinely negotiable costs in your business, and it's worth treating them that way.