Credit Card Processing Companies

Why Navigating the Payment Landscape is Better with a Broker

If you run a business in the UK, you know that accepting payments is not optional. It is the lifeblood of your cash flow. However, finding the right partner among the hundreds of credit card processing companies operating today is a significant challenge. The market is crowded, the terminology is dense, and the fees are often opaque.

We exist to change that. As your broker, we sit on your side of the table. We do not work for the banks. We work for you. Our goal is to ensure you have the best merchant account, the lowest transaction fees, and a payment solution that actually fits your business model.

In this guide, we will break down exactly how the industry works, where the hidden costs lie, and how our team leverages volume to secure deals you simply cannot get on your own. Whether you are a small business or a large enterprise, we have the expertise to manage your payment processing requirements efficiently. We understand that businesses processing different transaction volumes have unique needs, and we tailor our solutions to match the scale and processing requirements of each business.

The Role of Credit Card Processing Companies in Your Business

At its core, a payment processor handles the technical and financial logistics of moving money from your customer’s bank account to your business bank account. When a customer hands over a card or enters their details online, a complex chain of events occurs.

Credit card processing companies act as the bridge. They verify that the customer has the funds, they communicate with the card issuer, and they ensure the funds are settled into your account. For this service, they charge a variety of fees. Some are obvious, like the transaction fees per sale. Others are less obvious, such as a monthly fee for PCI compliance or a minimum monthly service charge.

We analyse these relationships daily. We know that not all merchant service providers are created equal. Some specialise in high risk sectors, while others focus on high-volume retail. Other providers offer features such as offline payments, high-risk support, or international transaction capabilities, giving businesses a wide variety of options to choose from. If you choose the wrong provider, you risk paying excessive processing fees or facing frozen funds.

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Understanding the Cost of Accepting Payments

The most common complaint we hear from new clients is that they do not understand their bill. This is intentional. Many credit card processing companies design their statements to be confusing. When we audit a prospective client’s statement, we look for three main cost components.

1. Interchange Fees

This is the fee paid to the card issuer (the customer’s bank). It is non-negotiable for you, but it is capped by EU and UK law for consumer cards. However, corporate credit card rates are higher. We ensure that your processor is passing on the true cost of interchange and not marking it up unnecessarily.

2. Scheme Fees

These are paid to Visa and Mastercard. They are small per-transaction costs. Again, some payment processing services bundle these into a generic “management” line item to hide margins. We strip this back to ensure transparency.

3. The Acquirer’s Margin

This is where the credit card processor makes their money. It is also where we do our best work. Because we manage transaction volume for thousands of merchants, we can force this margin down. A single small business negotiating alone has very little leverage. We have massive leverage.

diverse Payment Methods: It Is Not Just About Credit Cards

Modern consumers expect choice. If you only accept credit and debit cards, you might be missing out. We help you integrate alternative payment methods alongside standard card payments.

• Debit Cards: Debit card transactions are usually cheaper to process than credit cards. We ensure your fee structure reflects this difference.

• Mobile Payments: Services like Apple Pay and Google Pay are essential. These are essentially tokenised card payments, but the hardware needs to support them.

• Bank Transfers: For high-value B2B transactions, bank transfers or payment collection via Open Banking can save you significant sums on transaction fees. Electronic funds transfer (EFT) is another efficient and cost-effective way for businesses to send and receive money directly between bank accounts, often with lower fees than card payments.

• Direct Debit: If you run a subscription model, direct debit is often superior to recurring payments on a card, as direct debit fails less often.

We assess your customer demographics to recommend the right mix of payment methods.

The Truth About Transaction Fees and Pricing Models

When you sign a contract with credit card processing companies, they charge a variety of fees. Some providers also charge a set up fee when establishing your payment processing solution, which covers the initial costs of setting up physical or virtual payment terminals. You will usually be offered one of three pricing models. We help you understand which one is best for your turnover.

Tiered Pricing

This is the model we warn against most often. The processor categorises your credit card transactions into “Qualified,” “Mid-Qualified,” and “Non-Qualified.” They will quote you a low rate for qualified cards, but then downgrade many of your transactions to the more expensive tiers. This leads to higher overall processing costs. If you see this on your statement, contact us immediately.

Interchange Plus Plus (IC++)

This is the most transparent model. You pay the Interchange fee, plus the Scheme fee, plus a fixed markup for the payment processor. We generally prefer this model for our clients because it allows us to see exactly what the merchant service is charging for their actual work. It ensures that when interchange rates drop, your fees drop too.

Flat Rate Pricing

This is common with aggregators like PayPal or Square. You pay a single fixed fee (e.g., 1.75%) regardless of the card type. While simple, it is usually expensive for any business processing over £2,000 a month. You are paying a premium for simplicity. We can typically move you to a proper merchant account with significantly lower fees.

Hardware: Terminals and EPOS Systems

Your customers need a way to pay. For physical stores, this means a payment terminal. The days of the clunky machine connected to a phone line are gone. We supply modern, fast, and secure devices.

• Countertop Terminals: Connected via Ethernet or Wi-Fi. Ideal for retail.

• Portable Terminals: utilizing Bluetooth or Wi-Fi. Great for restaurants where you take the machine to the table.

• Mobile Terminals: These use a SIM card (GPRS/4G) to work anywhere. Perfect for in person payment at markets or for tradespeople.

We negotiate the monthly fee for these terminals. Often, providers will try to lock you into a 4-year lease with a high monthly fee. We fight for shorter contracts or rental-free periods.

Online Payment Processing and Gateways

If you trade online, you need a payment gateway. This is the software equivalent of the card machine. It encrypts sensitive payment information and sends it to the acquirer.

Payment gateway fees can be structured as a monthly fee plus a per-transaction charge. Some online payment gateways limit the number of transactions you can process before the price goes up. We help you find a gateway that scales.

Furthermore, we ensure your gateway integrates with your website. Whether you use WooCommerce, Shopify, or a custom build, we know which payment solution plugs in seamlessly. We also look at virtual terminal options. A virtual terminal allows you to take payments over the phone (MOTO) by typing the card numbers into a secure web page.

The Problem with Hidden Fees

The headline rate is rarely the full story. Credit card processing companies are notorious for hidden fees. When we review a client’s existing contract, we look for these specific “revenue enhancers” that providers use to pad their profits.

• Authorisation Fee: A small charge (e.g., 3p) every time the terminal connects to the bank, even if the transaction fails.

• Minimum Monthly Service Charge (MMSC): If your transaction fees do not reach a certain threshold, the provider charges you the difference.

• PCI Non-Compliance Fee: If you fail to validate your compliance, you can be charged a massive monthly fee. We help you manage the paperwork to avoid this.

• Setup Fees: Many providers charge setup fees just to open the account. We usually get these waived.

• Chargeback Fees: If a customer disputes a payment, you are hit with an admin fee.

• Refunding Fees: Believe it or not, some providers charge you to give money back to a customer.

We aim to eliminate or minimise every single one of these additional fees.

Why “We” Are Your Best Asset

You might be wondering why you should use a broker rather than going direct. The answer lies in the volume.

When you approach a bank, you are one small business. You get their standard rate card. When we approach a bank, we represent millions of pounds in transaction volume. We are a wholesale buyer of merchant services.

We force the banks to compete for your business. We present your profile to multiple financial institutions and credit card processors. We make them bid. This competition drives down the monthly costs and the credit card processing fees.

Moreover, we handle the paperwork. Setting up a merchant account involves anti-money laundering (AML) checks, credit checks, and compliance forms. We guide you through this, ensuring the application process is smooth.

High Risk Industries

Some businesses are classified as “high risk” by merchant service providers. This includes travel, gambling, adult entertainment, or industries with long delivery times.

If you are in a high-risk sector, you may find that standard credit card processing companies decline your application. We specialise in this area. We have relationships with acquirers who understand these risks and are willing to accept payments from your sector. We negotiate the “rolling reserve” (where the bank holds back a percentage of your money) to ensure it is fair and does not strangle your cash flow.

Security and Fraud Detection

Accepting card payments carries risk. Fraudsters are sophisticated. We ensure that the payment solution we recommend comes with robust fraud detection tools.

This includes Address Verification Service (AVS) and CVV checks for online transactions. For in person payment, chip and PIN is secure, but contactless payments have limits to prevent abuse. We help you configure these settings.

We also assist with PCI DSS compliance. This is a mandatory standard for anyone handling card data. Failing to be compliant results in fines. We make compliance simple, often providing portals that guide you through the questionnaire, saving you from the non-compliance monthly fee.

Managing Recurring Payments and Subscriptions

The subscription economy is booming. If your business relies on recurring billing, you need a processor that handles “card on file” transactions securely.

We ensure your provider offers “account updater” services. This means if a customer’s card expires and they get a new one, the payment provider automatically updates the details so your recurring payments do not fail. This continuity is vital for cash flow. We also compare direct debit options versus continuous authority credit card transactions to see which is more cost-effective for your specific average transaction value.

The Importance of Settlement Times

How fast do you get your money? Some credit card processing companies hold your funds for three or four days. This can hurt a small business.

We prioritise providers who offer “Next Day Settlement.” In some cases, we can secure same-day settlement. We believe that once a transaction is complete, the money belongs in your bank account, not in the processor’s float.

Integrating with Accounting Software

Your payment processing should not create extra work for your accountant. We look for payment methods and gateways that integrate directly with Xero, Sage, or QuickBooks.

When a payment collection is made, it should automatically reconcile in your books. This saves hours of manual data entry and reduces errors. We ask the right questions during the selection process to ensure this technical compatibility exists.

Mobile Payments and the Future

The way we pay is changing. Mobile payments and digital wallets are becoming the norm. We ensure your payment terminal is NFC enabled to accept Apple Pay, Google Pay, and Samsung Pay.

We also look at payment links. This allows you to send a secure link via email or SMS to a customer, allowing them to pay instantly on their phone. This is a powerful tool for chasing invoices or taking deposits.

Comparing Merchant Service Providers

The comparison process is where we shine. We do not just look at the headline rate. We model your actual trading history against the fee structure of multiple providers.

We calculate the “effective rate.” This is the total cost (all monthly fees, transaction fees, and hidden fees) divided by your total turnover. This gives you a true picture of the cost.

We often find that a provider offering a low transaction fee makes up for it with a high monthly fee for the terminal. Conversely, a provider with free terminals might have higher credit card fees. We do the maths to find the optimal balance for your specific transaction volume.

Virtual Terminals for Remote Payments

If you take orders over the phone, a physical machine is cumbersome. A virtual terminal is the answer. It is a secure web page where you enter the customer’s details.

However, virtual terminal fees can be higher because the risk of fraud is higher (the card is not present). We negotiate these rates. We also ensure the virtual terminal allows for multiple users if you have a sales team, without piling on additional monthly costs.

Negotiating the Contract

The “standard” contract from many credit card processing companies is three to five years. This is too long. If their service degrades, you are trapped.

We negotiate shorter terms. We aim for rolling monthly contracts or 12-month terms. We also fight to remove “early termination fees.” You should stay with a provider because they are good, not because it costs £500 to leave.

Understanding Your Statement

Part of our service is education. We teach you how to read your merchant service statement. We show you where to look for the authorisation fee, the scheme fees, and the processing margin.

Once you understand your statement, you are empowered. But you don’t have to monitor it alone. We provide ongoing support. If you see a fee creep up, you call us. We then call the bank and demand an explanation or a refund.

The Myth of the “Free” Card Machine

You will often see ads offering a “Free Card Machine.” Be very careful. Nothing is truly free. Usually, the cost of the hardware is recovered through higher transaction fees or a lengthy contract lock-in.

We analyse whether it is cheaper to pay a small monthly fee for the rental and get a lower transaction rate, or if the “free” rental actually makes sense for your volume. We run the numbers on processing costs over the full life of the contract.

Support When Things Go Wrong

When your terminal breaks on a Friday night, you cannot wait until Monday for support. We recommend credit card processing companies that offer 24/7 UK-based support.

Furthermore, because we are your broker, you can call us. We often have direct lines to senior management at the payment companies. We can escalate issues faster than you can via the general helpline. We manage the relationship so you can manage your business.

Switching is Easier Than You Think

Many businesses stay with expensive providers because they fear the hassle of switching. We manage the transition.

We coordinate the arrival of new terminals to coincide with the cancellation of the old ones. We assist with the paperwork to ensure your business bank account mandates are set up correctly. We aim for zero downtime. The only change you should notice is a lower bill at the end of the month.

Our Commitment to UK Businesses

We are proud to support the UK economy. We work with everyone from local cafes to multinational retailers. We understand the specific challenges of the UK market, such as the high usage of contactless payments and the dominance of Visa and Mastercard.

We also keep an eye on regulatory changes from the Payment Systems Regulator (PSR) to ensure your provider remains compliant and treats you fairly.

How We Handle Volume Discounts

Because we aggregate the transaction volume of all our clients, we effectively function as a massive corporate entity in the eyes of the banks.

This allows us to unlock volume discounts that are usually reserved for high-street giants. We pass these savings on to you. It is a collective bargaining approach. By joining us, you join a powerful network of merchants demanding better rates.

Debit Cards vs Credit Cards: The Cost Difference

It is vital to understand that debit cards are cheaper to process. Since the interchange cap introduction, personal debit card transactions have very low associated costs.

However, commercial credit cards (business cards) are expensive. If you sell B2B, this can hurt your margins. We ensure your provider uses “Interchange Plus” pricing so that you get the full benefit of cheap consumer debit cards, rather than a “blended” rate that profits the processor.

Case Studies: What We Have Achieved

While we cannot list specific client names due to confidentiality, we can share typical results.

• The Restaurant: processing £40,000 a month. We switched them from a flat-rate aggregator to a proper merchant account. We saved them over £350 a month in fees.

• The E-commerce Store: Struggling with a high chargeback fee and a gateway that kept crashing. We moved them to a robust payment solution with dedicated fraud screening. Their acceptance rate went up, and their costs went down.

• The B2B Wholesaler: Paying high rates on corporate cards. We negotiated a bespoke fee structure that capped the cost of commercial cards.

Start the Conversation

You do not need to be an expert in credit card processing. That is our job.

If you suspect you are paying too much, you probably are. If you are confused by your statement, that is by design. If you want a partner who fights for your bottom line, we are here.

We offer a free audit. You send us a recent statement. We analyse it line by line. We show you exactly where the hidden fees are and how much we can save you. There is no obligation.

The Technical Details of Payment Gateways

For our clients running online businesses, the payment gateway is the engine room. It is not just about fees; it is about success rates.

A cheap gateway that declines valid transactions is a disaster. We partner with payment gateway providers that have “smart routing.” This means if one acquiring bank is down or declines the transaction, the gateway can route it to another. This maximises your revenue.

We also look at the user experience. The payment page should look like your website, not a third-party banking page. This reduces cart abandonment. We check if the gateway supports “one-click” purchasing for repeat customers, utilising tokenisation to store credit card data securely.

Currency Conversion and International Payments

If you sell outside the UK, you need to consider Dynamic Currency Conversion (DCC) and multi-currency accounts.

Standard credit card processing companies often charge high FX fees. We can set you up with a provider that allows you to accept Euros or Dollars and hold them in that currency, or convert them at a far better rate than the banks offer. This is crucial for online payment processing in a global market.

Integrating Payment Links

Payment links are a simple yet underused tool. Imagine you are a freelancer or a builder. Instead of sending an invoice with bank details and waiting days for a transfer, you send an email with a “Pay Now” button.

The customer clicks, enters their credit card details, and you get paid. We can add this functionality to your payment solution often for no extra monthly fee, just the standard transaction fees.

Evaluating Customer Service

We test the customer service of every provider we recommend. We call them at peak times. We ask difficult technical questions.

If they keep us on hold for 30 minutes, we do not recommend them to you. We know that when you cannot process credit card payments, you are losing money. You need a partner who answers the phone.

The Application Process: What to Expect

Applying for a merchant account can feel invasive. The banks want to know about your turnover, your average ticket size, and your delivery times.

We pre-vet your application. We know what the underwriters are looking for. We help you present your business in the best light to ensure quick approval. We handle the back-and-forth so you do not have to.

Setting Up a Merchant Account

Setting up a merchant account is the foundation for any business looking to accept credit and debit card payments, whether in person, online, or via mobile. A merchant account acts as a dedicated bank account that enables you to process credit card transactions and ensures funds from card payments are securely transferred to your business bank account.

The process begins with choosing a payment processor or merchant service provider that aligns with your business needs. You’ll typically be asked to provide financial documents—such as recent bank statements, tax returns, and proof of identity—to verify your business and assess your eligibility. This step is crucial for both security and compliance, and it helps the provider determine the most suitable fee structure for your transaction volume and average transaction value.

When evaluating merchant service providers, it’s essential to look beyond the headline rates. Scrutinise the monthly fee, transaction fees, and any credit card processing fees that may apply. Some providers offer custom pricing or volume discounts, which can significantly reduce your processing costs as your business grows. Be vigilant for hidden fees, such as authorisation fees, chargeback fees, or additional fees for certain payment methods. Understanding the full fee structure upfront will help you avoid unpleasant surprises down the line.

Consider the range of payment methods you want to accept. In addition to standard credit and debit cards, many customers now expect alternative payment methods like Apple Pay, Google Pay, and even payment links for remote or mobile payments. If you plan to accept payments online, you’ll need an online payment gateway—either provided by your merchant service or a third-party payment processor. Popular online payment gateways such as PayPal, Stripe, and Square can be integrated with your website to enable secure online payment processing.

Security should be a top priority. Look for providers that offer robust fraud detection tools and PCI DSS compliance support to protect sensitive payment information. If your business relies on recurring billing or direct debit, ensure your merchant account supports these features to streamline payment collection and reduce failed transactions.

Integration is another key consideration. Your payment solution should work seamlessly with your existing financial systems, such as your accounting software and business bank account, to help you manage payments efficiently and reduce manual reconciliation.

Finally, don’t underestimate the value of responsive customer support. Setting up and managing a merchant account can be complex, so choose a provider known for excellent technical assistance and ongoing support.

By carefully assessing your average transaction value, transaction volume, preferred payment methods, and integration needs, you can select a merchant service provider that offers transparent pricing, reliable payment processing, and the flexibility to grow with your business. As your broker, we guide you through every step—ensuring you avoid hidden fees, secure the best possible rates, and set up a merchant account that empowers you to accept payments with confidence.

Understanding “Blended” Pricing

We mentioned this earlier, but it deserves a deeper dive. Blended pricing is where the provider gives you one rate for everything—debit, credit, consumer, corporate.

It looks simple. But often, the provider sets this rate high enough to cover the most expensive cards. This means when a customer uses a cheap debit card, the provider pockets the difference. We almost always recommend unbundled pricing so you pay the true cost for each specific card type.

Managing Chargebacks

A chargeback occurs when a cardholder disputes a transaction. It is a headache.

We help you implement best practices to prevent them. This includes clear descriptors on customer bank statements (so they recognise your name), robust delivery tracking, and clear refund policies. If you do get a chargeback, we can guide you on how to challenge it effectively.

The Future of Physical Terminals

The payment terminal is evolving into a business management tool. Modern “smart” terminals run on Android.

They can run apps. You can have your loyalty programme, your staff timesheets, and your inventory management all on the payment terminal. We help you explore these advanced features. Why have a separate device for ordering and paying when one device can do both?

Conclusion: Let Us Handle Your Payments

The world of credit card processing companies is a jungle. There are predatory contracts, confusing rates, and technology that changes every year.

You have a business to run. You should not have to spend hours on hold with a bank or trying to decipher a spreadsheet of transaction fees.

That is our role. We are your leverage. We are your experts. We use our collective power to secure you a deal that protects your margins and supports your growth.

Whether you need a simple countertop machine, a complex online payment system, or a high-risk account, we have the relationships to make it happen.

Don’t accept the first rate you are given.

Don’t pay hidden fees.

Don’t go it alone.

Let us audit your current setup. Let us show you what is possible when you have a broker in your corner. Upload your statement to our secure portal today, or call our team for a chat. We are ready to help you save money and take control of your payments.

Frequently Asked Questions

What is a Merchant Service Charge (MSC)?

This is the percentage fee charged on every transaction. It is the headline rate you negotiate. However, it is just one part of the total cost. We look at the MSC in the context of the full fee structure.

Can I pass the credit card fee to the customer?

In the UK, surcharging personal cards is generally banned. You cannot charge a customer extra for using a Visa or Mastercard consumer card. You must absorb this cost as a business expense. This makes getting the lowest rate even more critical.

How long does it take to switch?

With our help, we can usually get a new account approved in 2 to 3 days. Shipping the payment terminal takes another day. We can often have you up and running with a new provider within a week.

Do I need a business bank account?

Yes. To have a merchant account, you generally need a business bank account in the same name. We can advise on this if you are a new start-up.

What if I have bad credit?

It can be harder to get a merchant account, but not impossible. We work with providers who specialise in adverse credit. You may pay slightly higher fees initially, but we can help you get accepted and start trading.

What is a Payment Service Provider (PSP)?

A PSP is another name for a payment processor or gateway. They provide the technical connection to the banking network. We work with the top PSPs in the UK.

Why are my “non-qualified” fees so high?

This is a symptom of Tiered Pricing. The provider is penalising you for accepting certain cards or keying them in manually. We can move you to a pricing model where these penalties do not exist.

Deep Dive: The Mechanics of a Transaction

To truly understand where your money goes, we need to look at the split second a payment occurs.

1. Authorisation: The terminal reads the chip. It sends a request to the acquirer.

2. Routing: The acquirer sends this to the Card Scheme (Visa/Mastercard).

3. Verification: The Scheme sends it to the card issuer (customer’s bank).

4. Approval: The issuer checks funds and fraud markers. They send a “Yes” or “No” back down the line.

5. Settlement: The money is ring-fenced. Later (usually overnight), the funds move from the issuer to the acquirer, and then to your business bank account.

At every step, a fee is levied. The authorisation fee covers the data check. The interchange fee covers the risk taken by the issuer. The scheme fee pays for the network. The processing fees pay the acquirer.

We optimise this chain. We ensure you are not paying for data hops you do not need. We ensure your terminal is configured to route via the cheapest path.

Optimising Your Payment Strategy

It is not just about cutting costs; it is about increasing revenue. If your payment solution is slow or unreliable, customers walk away.

We look at your peak trading times. If you are a bar, can your terminals handle Friday night volume? If you are a website, can your gateway handle Black Friday traffic? We stress-test the providers we recommend.

We also look at average transaction value. If you sell low-value items (e.g., coffee), a flat fee per transaction is a killer. You need a percentage-only rate. If you sell high-value items (e.g., furniture), a percentage rate is expensive. You might want a capped fee. We structure the deal to suit your ticket size.

The High Cost of Loyalty

In the energy market, loyalty is punished. The same is true for merchant services. If you have been with the same provider for five years, you are almost certainly overpaying.

They rely on your inertia. They creep the fees up slowly. A 0.1% increase here, a new “compliance fee” there. Over time, it adds up.

We act as your constant watchdog. Even after we secure your deal, we are here to review it. If the market moves, we move you. We ensure your loyalty is to your own bottom line, not to a bank.

Transparency in Billing

We believe a merchant service invoice should be as easy to read as a utility bill.

It should clearly show:

• Total volume processed.

• Breakdown by card type (Debit, Credit, Commercial).

• The exact rate applied to each.

• The total Scheme Fees.

• The total Interchange Fees.

• The terminal rental monthly fee.

If your bill is just one line saying “Service Charges,” you are flying blind. We demand transparent billing from the providers we partner with.

Final Thoughts on Security

Data breaches destroy reputations. We take security incredibly seriously. The payment processing services we recommend use Point-to-Point Encryption (P2PE).

This means card data is encrypted the moment it touches the terminal and is not decrypted until it reaches the secure vault of the bank. Your POS system never sees the card number. This drastically reduces your scope for PCI compliance and keeps your customers safe.

Trust us to protect your data and your revenue.

Contact our team today. Let’s get your payment processing sorted, secure, and saving you money. We are ready to work for you.