Payment Processing Costs for Online Shops
Compare online payment charges alongside order size, ecommerce subscriptions, gateway fees and the cost of returns.
The short answer
An online shop needs the percentage and fixed transaction charge, not just the advertised rate. Add any platform or gateway charges, required apps and refund-related costs. Separate payment economics from delivery, advertising and product margins.
In this guide
Identify the layers of online payment cost
List the ecommerce platform, payment provider, gateway if separate, and any apps needed for the checkout. Establish which company charges each item. An included gateway should not be entered again as a separate fee.
Square’s online-store plans show that subscriptions and card charges are separate pricing elements. Other platforms and arrangements need their own full schedule. Ask whether using a particular processor changes the platform fee or available features.
Record card origin, payment methods and currencies where they affect your tariff. Do not import the shop’s in-person card rate into the online calculation.
Order value changes the effective cost
Fictional online shop. Monthly sales are £12,000 across 600 payments. Processing is assumed at 1.5% plus 25p, with £30 platform and £20 required-app subscriptions.
| Component | Monthly cost |
|---|---|
| Percentage processing | £180 |
| 600 payments × 25p | £150 |
| Platform and app subscriptions | £50 |
| Total listed costs | £380 |
The listed total is approximately 3.17% of sales. If the same £12,000 comes through 300 payments, the total falls to £305. The difference arises from payment count, not a different percentage tariff.
Ask what happens when an order is refunded
Find out whether the original processing charge is returned, whether a separate refund charge applies and how partial refunds are treated. Check dispute fees and any other costs in the actual contract. These vary, so do not assume one provider’s rule applies to another.
Keep gross payments processed separate from refunds and net revenue. A provider may have charged on the original payment even if the customer later receives money back. Compare statements using the billing basis in the agreement.
Include currency-conversion and cross-border charges where relevant. If settlement is delayed or subject to conditions, consider the cash-flow effect separately from the fee total.
Price the cost of changing checkout
- Confirm compatibility with the existing platform and required payment methods.
- Budget for integration work, testing and any subscription overlap.
- Check recurring-payment arrangements and saved-payment features before migration.
- Test successful payments, failures, refunds and reporting through the supported process.
- Confirm access to historical statements and how older orders will be refunded.
A lower tariff can be outweighed by implementation cost or the loss of a required checkout function. Ask for a migration plan and an itemised proposal.
Keep the comparison focused
Run the same sales value and payment count through each offer, using representative card categories. Add the required platform, gateway and app costs once. Keep delivery, advertising and product costs in the wider trading model.
Use the calculator’s online channel for the payment comparison and include any one-off switch cost. For shops selling both online and in person, read the retail cost guide and compare the combined setup.
Common questions
Why is my effective online cost higher than the headline percentage?
Fixed per-payment charges and subscriptions increase the total. Different card categories, refunds or other applicable charges may also contribute.
Does refunding an order always refund the original processing fee?
Do not assume so. Check the provider’s current refund and fee terms for your agreement.
Put your own figures to work.
Use the free calculator to organise your costs and keep a report. If something is unclear, you can ask for a free initial review.
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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.
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