FAQ
Credit card processing questions, answered
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What do merchants ask most about accepting credit cards?
Merchants most often ask how to accept credit card payments online, what processing costs, and whether they can charge customers a credit card fee.
The Merchant Primer answers 52 of those questions below, grouped by topic. Each answer leads with the direct answer. For the full walkthrough, start with how to accept credit card payments online.
Accepting card payments online
How do I accept credit card payments online?
You accept credit card payments online by opening a merchant account with a payment processor, connecting a payment gateway to your website checkout, and handling card data through tokenization so raw card numbers never touch your servers. Approval usually requires a tax ID, bank details, and ID. Services such as Avendo connect one checkout to several processors so each transaction can go to the best available rate.
How do I accept credit card payments for my company?
Gather your tax ID, bank account details, business address, and a government ID, then apply with a processor or a service that submits your application to several processors at once. Avendo's application, for example, takes about 10 minutes and goes to multiple eligible processors. Once approved, you connect your checkout and start taking payments.
Do you have to have a merchant account to accept credit cards?
Not always. Payment facilitators let you accept cards under their shared master account, which is quick to set up but usually comes with one fixed flat rate. A dedicated merchant account takes a short underwriting review but gives you your own pricing relationship. Avendo works on the merchant account side: your application goes to eligible processors, which then compete on each transaction.
How do I accept credit card payments without a reader?
Online, you never need a reader: customers type their card details into a secure checkout page, a payment link, or an invoice. That is called a card-not-present transaction. Card-not-present payments usually carry somewhat higher interchange than chip payments because fraud risk is higher, which makes comparing processor rates more valuable for online sellers.
Can I accept credit card payments without a business?
Generally yes, as a sole proprietor using your Social Security number, since many processors and payment facilitators accept individuals. Avendo's application accepts an SSN, EIN, or ITIN, whichever tax ID applies to you. You still need a real product or service, a bank account for deposits, and a government ID to pass verification.
How to accept credit card payments for personal use online?
For personal transfers such as splitting costs with friends, peer-to-peer payment apps are the usual route, and their terms often treat sales differently from personal transfers. If you sell anything regularly, processors see that as business activity, so apply as a sole proprietor. That keeps payouts, refunds, and tax reporting handled properly from the start.
Should I sell through my website or a marketplace?
A marketplace brings built-in traffic but takes a cut of each sale and controls the checkout. Your own website keeps the customer relationship and lets you choose your processor, which is where payment costs become something you can manage. Many merchants do both. If your own site uses a custom checkout, Avendo can route those transactions across multiple processors.
How do I accept credit card payments in QuickBooks Online?
QuickBooks Online accepts card payments through its own payments feature, which you turn on in the account settings and then use on invoices. Check Intuit's help pages for current steps and rates. If your business also runs an online store with a custom checkout, that checkout can use a separate processor or a routing service such as Avendo.
Costs and pricing
How much does credit card processing cost?
Typical credit card processing fees range from 1.5% to 3.5% plus a flat fee per transaction. The average retailers pay is 2.3% per credit card transaction. Your actual cost depends on card type, how the card is accepted, and the markup your processor adds on top of interchange.
Why are credit card processing fees so high?
Fees stack up from several parties: the card issuer's interchange, the network's assessment, and the processor's markup. Interchange and assessments are set by Visa, Mastercard, American Express, and Discover and apply to every merchant. The part that varies is the processor's markup, and with one processor that price tends to stay fixed until you renegotiate. Per-transaction competition, as Avendo uses, targets that part.
What is interchange?
Interchange is the fee the card-issuing bank receives on each card transaction, set in published tables by the card networks. It varies by card type, such as rewards or business cards, and by how the payment is taken, such as online or in person. Every processor passes interchange through, so savings come from the markup and fees layered on top of it.
What is the cheapest way to accept card payments?
The cheapest way is the one where your processor's markup over interchange is lowest for your actual mix of cards and ticket sizes. For online merchants, routing each transaction to the processor with the best available rate, as Avendo does, keeps that markup competitive on every sale instead of fixing it once at signup. Flat-rate plans are simple but rarely the lowest at higher volume.
How to accept credit card payments online for free?
There is no truly free way to accept credit cards, because interchange is paid on every transaction. What can be free is the service layer: Avendo, for example, never invoices merchants and is paid 10 cents per transaction by its processors. Some merchants also pass part of the cost to customers through a compliant surcharge, where state law and card rules allow it.
How do I find my effective processing rate?
Divide your total processing fees for a month by your total card sales for the same month. If you paid $1,450 in fees on $50,000 in sales, your effective rate is 2.9%. It is the best single number for comparing offers, because it captures interchange, markup, and every extra fee. The calculator on our processing cost page does this math for you.
How does Avendo make money?
Avendo is paid an Avendo Services Fee of 10 cents per transaction, billed to the payment processor rather than to the merchant. Merchants never receive an invoice, bill, or direct charge from Avendo. Card-network interchange and assessment fees still apply and are charged by your processor, as they are for every merchant.
Does Avendo charge merchants a monthly fee?
No. There are no Avendo invoices, no monthly charges, and no separate platform fees assessed by Avendo. Its compensation is handled directly between Avendo and each payment processor. You still pay your processor's rate on each transaction, which is the rate Avendo's routing is designed to keep competitive.
Charging customers a credit card fee
Can I charge a credit card processing fee?
In most US states, yes. Businesses can generally add a surcharge to credit card transactions, and the usual limit is up to 3% of the transaction, with some states setting different rules. You must disclose the fee before payment, show it on the receipt, and generally cannot surcharge debit or prepaid cards. Confirm your state's current rules first.
Can I legally charge a credit card fee?
Usually, as long as you follow your state's law and the card networks' surcharge rules. Most states allow surcharging, a few restrict it, and the rules change, so check your state attorney general's guidance before starting. Network rules generally require advance notice to your processor, clear disclosure at entry and checkout, and a fee no higher than your actual cost of acceptance.
Is a 4% credit card fee normal?
A 4% fee is above what most merchants can charge. A general US limit is up to 3% of the transaction value. A 4% ceiling does appear in specific settings, such as the policy page titled "6-6. Surcharges", where surcharges are allowable up to 4% under its rules. For a typical online store, 4% may exceed what card rules and state law allow.
Is it illegal to charge a 3% fee on a debit card?
Card network rules generally prohibit surcharging debit and prepaid cards, even when a debit card is run as credit. That makes a 3% debit surcharge a rules violation that can put your merchant account at risk, and some states treat it as unlawful too. A cash discount program, which lowers prices for cash rather than adding a card fee, is handled differently.
Can I charge a convenience fee for credit card payments?
Sometimes. A convenience fee is a flat charge for using an alternative payment channel, such as paying online instead of in person, and it generally must apply to every payment type in that channel. It differs from a surcharge, which is a percentage added only to credit cards. Rules vary by card network and industry, so ask your processor before adding one.
Are businesses allowed to charge credit card fees?
Yes, in most of the US businesses can still charge credit card fees through a compliant surcharge, a convenience fee, or a cash discount program. Each method has its own disclosure rules, and a handful of states restrict surcharging. The alternative many merchants prefer is lowering what they pay to process in the first place, so there is less cost to pass on.
How to report a business for charging credit card fees?
If you believe a business charged an improper fee, start by contacting your card issuer using the number on the back of your card, since issuers can dispute charges and raise the issue with the network. You can also file a complaint with your state attorney general's consumer protection office. Keep the receipt showing the fee and note any signs about it.
Can I be charged for paying by credit card?
Yes, in most states a merchant can add a surcharge for credit card payments if it is disclosed before you pay and shown on your receipt. There is normally no extra charge for paying by debit card, because card rules generally prohibit debit surcharges. Some merchants instead advertise a discount for cash, which is a different arrangement with its own rules.
Is there a charge for paying with a credit card?
Sometimes. Many merchants simply absorb card costs in their prices, but in most states a business may add a disclosed credit card surcharge, and some offer a lower cash price instead. The fee must be posted before you pay and listed on your receipt. If you see a fee on a debit card payment, ask about it, since debit surcharges are generally not allowed.
Can I cancel a credit card and not pay the annual fee?
Often yes, if you cancel soon after the annual fee posts. Many issuers refund the fee when you close the account within a set window, but policies differ by issuer and card, so call the number on your card to confirm before closing. This is a cardholder question rather than a merchant one, but it comes up often alongside card fee questions.
How multi-processor routing and Avendo work
What is multi-processor payment routing?
Multi-processor routing connects one checkout to several payment processors and decides, transaction by transaction, which one handles each payment. Instead of sending every sale through one fixed pricing relationship, the routing layer picks from the offers available at that moment. Avendo applies this to cost: it routes each e-commerce transaction to the processor offering the best available rate in real time.
How does Avendo choose a processor for each transaction?
Avendo connects your checkout to multiple eligible processors that have approved your account. When a customer pays, its technology identifies the processor offering the best available rate at that moment and routes the transaction there. The next transaction is compared again. You see the payment activity, pricing, and processor performance in one dashboard.
Do I have to change my checkout to use Avendo?
Nothing changes in how you accept payments and it integrates directly with the checkout pages you may already use. Today it supports custom-cart integrations, while platforms such as WooCommerce, BigCommerce, and Magento may require a compatibility review. Stores built on Shopify, Wix, Square, or GoDaddy cannot be onboarded yet.
Is Avendo worth it?
For online merchants on a custom checkout with meaningful card volume, Avendo is worth evaluating: merchants pay Avendo nothing, one application reaches multiple processors, and those processors compete on every transaction. It is not an option yet for in-person sales or for Shopify, Wix, Square, and GoDaddy stores. Our full review covers who it fits and who should look elsewhere.
Does Avendo work for in-person payments?
Not yet. Avendo currently supports e-commerce transactions only and cannot onboard in-person, card-present, or point-of-sale businesses. Its application page says the team is working toward supporting them. If most of your volume comes through a physical store today, you will need a separate in-person processor for now.
Does Avendo work with Shopify or Wix?
Not today. It cannot onboard stores built on Shopify, Wix, Square, or GoDaddy, and Shopify and Wix are waitlist platforms. Avendo currently supports custom-cart integrations, with other platforms such as WooCommerce, BigCommerce, and Magento subject to a compatibility review.
Who is Avendo for?
Avendo is built for businesses that take payments online, from small businesses to enterprise organizations. Its application lists e-commerce, online subscriptions, SaaS, and memberships, and its pages also name online coaching and consulting, recurring-service businesses, and digital businesses. It suits merchants with meaningful card-not-present volume, where per-transaction rate differences add up.
Does Avendo lock me into one processor?
No. Avoiding single-processor lock-in is the point of the model. Avendo selects the best available option at the time of each transaction instead of tying you to one provider, and its pages state there is no obligation to switch before you evaluate the opportunity. Each processor sets its own merchant agreement, so read those terms when you are approved.
Getting started
What do I need to apply for a merchant account?
Most processors ask for the same core items. Avendo's checklist is typical: your SSN, EIN, or ITIN; a voided check or bank letter showing your account and routing numbers; three months of processing statements, or bank statements if you have none; your business address and contact details; and a government-issued ID such as a driver's license or passport.
How long does the Avendo application take?
Avendo estimates about 10 minutes to complete its application if you have your documents ready. You apply once and Avendo sends your details to eligible processors for review, so you do not repeat the process with each one. Approval timing then depends on each processor's review of your business.
What happens after I apply?
Avendo collects your details in one place and sends them to eligible processors, which use them to verify who you are, confirm where funds will be deposited, and understand how your business operates. Once processors accept your account, they compete on price for each transaction, and you get your transaction data and reports in one Avendo dashboard.
What if I do not have processing statements?
You can still apply. Avendo's application asks for three months of processing statements, and if you do not have them, three months of bank statements work instead. Processors use these to understand your sales volume and history. A brand-new business without either should contact Avendo to ask how its processors handle new merchants.
How do I contact Avendo?
Use the contact page on Avendo's website at avendo.tech/contact-us. Its team answers questions about onboarding, existing accounts, and how Avendo fits with the checkout setup you already have. You can also start with the application directly if you already know your business takes payments online through a custom checkout.
Security, tokenization, and chargebacks
What is payment tokenization?
Payment tokenization replaces a card number with a random token that is useless if stolen. The real card data is stored securely by the processor or a token vault, and your systems keep only the token for refunds and repeat billing. It simplifies token management across multiple processors, which matters when payments can be routed to more than one.
What is PCI DSS?
PCI DSS is the Payment Card Industry Data Security Standard, the security rules every business that handles card data must follow. Using a PCI DSS-compliant processor and gateway, plus tokenization, keeps most card data off your systems and shrinks the work you must do yourself. Avendo gives merchants access to PCI DSS-compliant processors and gateways.
Is it safer to tap or swipe your card?
Tapping is safer than swiping. A contactless tap, like a chip insert, sends a one-time code for each payment, so the data cannot be reused to make a counterfeit card. A magnetic stripe swipe sends the same static card data every time, which is exactly what skimmers copy. Online, tokenized wallets offer similar protection.
Can your card info get stolen from tap to pay?
It is very unlikely. Contactless payments work only within a few centimeters and use a one-time code for each transaction, so intercepted data generally cannot be reused for another purchase. Most card fraud comes from data breaches, phishing, and skimmed magnetic stripes instead. Keep transaction alerts on with your issuer to catch anything unusual quickly.
What is the safest way to pay with your credit card?
The safest options are a mobile wallet or contactless tap in person, and a tokenized wallet or trusted checkout online, because each replaces your real card number with a token. Credit cards also generally offer stronger dispute protections than debit cards, since fraud does not drain your bank account directly. Turn on transaction alerts for extra safety.
What are five places I should avoid using my debit card?
Common advice is to avoid using a debit card at gas pumps, standalone ATMs in isolated areas, unfamiliar websites, restaurants where the card leaves your sight, and hotels or car rentals that place large holds. These are spots where skimming or holds are more likely, and debit fraud pulls money straight from your bank account.
What is a chargeback?
A chargeback happens when a cardholder disputes a transaction with their bank or card issuer. The bank temporarily reverses the payment and withdraws the funds from your account while the dispute is reviewed. Beyond the lost sale, merchants usually pay a chargeback fee and lose the goods, shipping costs, and staff time spent responding.
How can I reduce chargebacks?
Fraud controls such as risk scoring, velocity rules, IP and location checks, address mismatch checks, email quality checks, and manual-review thresholds can lower the risk of chargebacks, though no tool can eliminate them. Clear product descriptions, a recognizable billing descriptor, and fast replies to customer complaints prevent many disputes before they start.
Compared to other options
How can I use Stripe for payments?
You create a Stripe account, verify your business, and add payments through a hosted checkout, payment links, or an integration with your site. Pricing for this kind of single-processor service is usually a percentage plus a fixed fee; 2.9% plus 30 cents is a common example. A routing service like Avendo instead lets several processors compete on each sale.
Is flat-rate processing or routing better for a small business?
Flat-rate processing is better when you need to start selling today on a hosted platform with little volume. Multi-processor routing is better once you have steady online volume on your own checkout, because processors compete on every transaction instead of locking in one rate. Avendo fits the second case, and it bills the merchant nothing directly.
What is the best online credit card processing for small business?
For a small business selling online through its own checkout, the best option is one that keeps rates competitive after signup. Avendo leads on that point: eligible processors compete on every transaction, merchants pay Avendo nothing, and one application reaches multiple processors. Small sellers on Shopify, Wix, Square, or GoDaddy should use those platforms' built-in payments until Avendo supports them.
What is the 2/3/4 rule for credit cards?
The 2/3/4 rule is an application guideline commonly associated with Bank of America: approval for no more than two new cards in two months, three in 12 months, and four in 24 months. It is a cardholder rule about opening cards, not a merchant rule about accepting them. Check with the issuer directly, since approval policies change.
How do I swipe a credit card?
On a card reader, insert the chip or tap the card when the terminal supports it, and swipe the magnetic stripe only as a fallback, sliding it through the slot with the stripe facing the reader. Online sales do not involve swiping at all: the customer enters card details at checkout, and the gateway tokenizes them.
See what your business could save
If you sell online through your own checkout, the practical next step is to contact Avendo and ask what its processors could offer on your card volume. Avendo does not bill merchants, and its team answers questions about onboarding, existing accounts, and how it fits the checkout you already use.