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Credit card fees in Canada cost merchants around 2% or more when customers use their credit cards to make purchases – and many times, these credit card processing and merchant fees are passed onto consumers. We’re breaking down what they are and Key Takeaways Credit card fees are around 2% in Canada. The fee varies depending on what type and tier of credit card you have. Amex cards have higher credit card fees in Canada compared to Visa and Mastercard. In this article Show table of contents Most common fees How they’re calculated How much are they? How to reduce fees FAQ Never miss an amazing deal again + get our bonus 250+ page eBook for FREE . Join 50,000 other Canadians who receive our weekly newsletter – learn more . What are the most common credit card processing fees? Credit card fees in Canada for merchants specifically can be broken down into 7 types: Interchange fees: The credit card network sets this fee, usually a percentage of the transaction amount. The interchange fee is split between the bank issuing the card and the network itself. Assessment fees: These are small monthly fees, usually 0.08% to 0.09% of the total sales processed, which are paid to the credit card company. Processor markup fees: The credit card processor charges this fee on every transaction. It’s usually around 10 cents per transaction. Terminal fees: To process your transactions in person, you need to either purchase a terminal or lease it from the payment company. Basically, you must pay a large upfront fee or be charged smaller monthly payments. Payment gateway fees: To process online transactions, you’ll pay monthly or per-item fees called payment gateway fees. These are the costs of connecting your online store to a merchant account. PCI fee: This fee goes to the payment card industry to ensure credit card security and fraud prevention. You can pay the fee for around $5 per month or up to $99 annually. Incidental fees: These aren’t regular fees. Instead, you pay them if something happens on your end – like you don’t have enough money in your account to pay your processing fees. How processing fees are calculated A few factors go into calculating how much a merchant is charged. Card network Your credit card fees may differ depending on the network – Visa, Mastercard, or Amex. Both Visa and Mastercard publish minimum and maximum fees: Credit card network Minimum fee Maximum fee Visa 0.8% 2.45% Mastercard 0.87% 2.42% While Amex doesn't list their standard fees online, they’re believed to be higher than Visa and Mastercard. That said, they offer an OptBlue Wholesale Discount Rate for vendors. If you have fewer than $1 million in transactions per year with Amex, you may qualify for lower pricing. The fee ranges from 1.6% to 2.4% and varies by both the merchant category and the size of the transaction. Type of credit card You’ll pay different fees for each card the company offers. For example, you’ll pay fewer fees for basic or regular cards and more for premium or elite rewards cards. Here is how Mastercard credit cards rank from lowest to highest fees: Core (this tier represents "regular" cards) World World Elite Here’s how Visa cards rank from lowest to highest fees: Classic, Gold, Platinum Infinite Infinite Privilege American Express doesn't have card classifications, but how the card is processed can make a difference. Card processing type The interchange fee we mentioned earlier depends on the type of card and how it’s processed. You’ll be charged different rates based on whether the card was physically inserted (chip), contactless (tap), or online. How much are credit card fees in Canada? When you accept a credit card payment and get hit with credit card fees, the interchange fee goes to the bank that issued the credit card and the network. This is because the bank pays out the rewards. The company processing the transaction also issues its own processing fees. Most companies break down these fees into tiers: standard, premium, and ultra-premium. Standard credit cards Let's start with standard credit cards. Mastercard defines them as "Core" and Visa calls them "Classic/Gold/Platinum." Transaction type Mastercard Visa Contactless 0.87% 1.25% Chip 0.92% 1.25% Online 1.67% 1.40% Mastercard is cheaper for in-store purchases while Visa offers better rates for online ones. Premium credit cards Next up are premium cards, which include Visa Infinite and Mastercard World cards. Transaction type Mastercard Visa Contactless 1.16% 1.57% Chip 1.22% 1.57% Online 1.90% 1.65% Even with premium cards, Mastercard still has higher fees for processing online transactions. That said, Visa Infinite cards outshine World Mastercards in just about every area, so this isn’t quite a fair comparison. Ultra premium credit cards The final level for both of these networks is the World Elite Mastercard and Visa Infinite Privilege. Transaction type Mastercard Visa Contactless 1.48% 2.08% Chip 1.56% 2.08% Online 2.13% 2.40% Again, we have an unequal comparison as World Elite Mastercards are more similar to Visa Infinite cards than VIP cards in terms of perks and benefits. Accordingly, though, World Elite Mastercards have lower fees across the board. 4 ways small businesses can reduce credit card processing fees If you’re looking for ways to save money on credit card fees, here are a few strategies you can try. Don't accept credit cards . While this will save you from paying processing fees, it also risks losing your customers who don’t have cash. Encourage customers to use cash or debit . Offering a small discount for using cash or debit could motivate your customers to opt for those payment methods instead of credit cards. Remember that if you pass any credit card fees onto customers, you are required to advise them (like with a sign). Only accept Visa and Mastercard . Unless you can get in on the Amex OptBlue Wholesale Discount Rate, you might choose to avoid Amex cards. With the discount, you’ll pay similar processing fees to Word Elite Mastercards. Don't accept online payments . Online transactions cost more, potentially because online fraud levels are much higher than in-store ones. If you don't need to run an online presence, there's little sense in setting up online payments. FAQ What is the fee for using a credit card? The fee for using a credit card depends on factors including the card issuer, type of card, purchase amount, and payment process type. Is it illegal for businesses to charge credit card fees? No, banks and credit card networks charge businesses processing fees, and businesses can choose to pass some of these fees onto customers. Businesses can also specify which credit cards they accept or tell customers they only accept cash if they’re trying to minimize credit card fees. creditcardGenius is the only tool that compares 126+ features of 227 Canadian credit cards using math-based ratings and rankings that respond to your needs, instantly. Take our quiz and see which of Canada's 227 cards is for you. Did you find this article helpful? Yes No Editorial Disclaimer : The content here reflects the author's opinion alone. No bank, credit card issuer, rewards program, or other entity has reviewed, approved, or endorsed this content. For complete and updated product information please visit the product issuer's website. Our credit card scores and rankings are based on our Rating Methodology that takes into account 126+ features for each of 227 Canadian credit cards. 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