Authorisation and Per-Transaction Fees Explained
See how pence-per-payment charges affect small sales, and why chargeable requests may differ from the number of successful payments.
The short answer
A per-transaction fee is a fixed amount attached to a defined event. That event might be a completed payment, an authorisation request or another processing action. Check the definition and count, then add the charge to the percentage fee. Small sales are particularly sensitive to a fixed pence amount.
In this guide
What exactly is the provider charging for?
| Description | Question to ask |
|---|---|
| Per-payment fee | Is it charged only on completed or captured payments? |
| Authorisation fee | Does it apply to approved, declined, cancelled or repeated requests? |
| Gateway or processing fee | Is this the same charge as the quoted transaction fee, or a separate service? |
| Refund or other event fee | What triggers it, and is it already included elsewhere? |
Adyen’s invoice guidance, for example, distinguishes request-based processing fees from other payment charges and identifies several authorisation outcomes. That demonstrates why a successful-sales count is not always the right billing count. Your provider’s rules may be different.
Why small payments change the effective rate
Payment cost = sale amount × percentage rate + fixed fee. Divide that cost by the sale amount to express the result as a percentage.
| Sale value | 1% percentage charge | 3p fixed fee | Total | Effective rate |
|---|---|---|---|---|
| £5 | 5p | 3p | 8p | 1.60% |
| £20 | 20p | 3p | 23p | 1.15% |
| £50 | 50p | 3p | 53p | 1.06% |
The rate has not changed, but its effect differs with the average sale. A café with many small purchases and a business taking larger invoices can therefore get different outcomes from the same tariff.
Worked example: chargeable requests exceed completed payments
Fictional request-based tariff. A business takes £10,000 from 2,000 successful payments. Its provider records 2,100 chargeable requests, including 100 unsuccessful attempts. The assumed fees are 1% of successful sales plus 3p per chargeable request.
The percentage charge is £100. Request charges are 2,100 × £0.03 = £63. The total is £163, before other services. Using only 2,000 successful payments would produce £160, understating this example by £3.
These are model assumptions, not a claim that every supplier charges for failed payments. Check the actual event rules before making the same adjustment.
Reconcile event counts before changing your setup
- Match the invoice period to the transaction report.
- Compare successful payments with the billed count for each separate fee.
- Ask the provider to explain declined requests, retries, cancellations and partial captures where relevant.
- Check for included allowances, tiered prices or minimum charges.
- Find out whether the quoted percentage already includes any charge you are adding.
If online retries appear excessive, ask the provider or integration supplier to review the cause and supported settings. Do not remove security checks or change retry behaviour solely to reduce a few pence without understanding the effect on genuine payments.
Put transaction charges into a fair comparison
Give competing suppliers both turnover and transaction counts, plus the channels used. Ask them to price the same activity and identify any chargeable events outside successful payments. A quote based only on turnover is incomplete where fixed event fees apply.
Use the calculator’s payment count for completed payments. If a provider charges additional requests that the model does not separately count, calculate those fees alongside it and add the incremental amount once as an additional cost. Keep the supporting event calculation with your report.
Common questions
Do contactless payments always have the same fee as chip and PIN?
Do not assume that from the payment method alone. Check the provider’s tariff, card category and transaction channel.
Should I add an authorisation fee and a transaction fee together?
Only if the tariff confirms they are separate charges. Sometimes different labels describe the same fee, so adding both would overstate the cost.
Put your own figures to work.
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Sources and how to use this guide
Primary references checked on 15 October 2026:
Worked examples are original fictional scenarios, not customer results, market averages or provider quotations. Unless stated otherwise, they use a consistent VAT basis and include only the costs listed. Provider prices, eligibility and terms can change. Check your written agreement before deciding.
Our guides explain costs and comparison methods. They do not rank the whole market or claim hands-on product testing. Source links are references, not a claim of partnership. Read the calculation method and limitations, or about the service.