Card Payment Costs for Small Business in Canada

Card payment costs are not one fee. They are a stack: interchange paid to the cardholder's bank, charges from the card network, and the processor or acquirer's own charge for handling the sale, plus the occasional costs that sit outside the sale itself, such as chargebacks and terminal or gateway charges. This guide explains what each part is, how the two main pricing models present that stack, what debit costs, what a chargeback costs, and the Canadian surcharging rules. This guide was checked November 4, 2026, against the pages in Sources. It recommends no processor, ranks no processor, and makes no cheapest claim. It is cost-structure intent only: it does not repeat the provider-setup steps in the related guide on accepting online payments, which covers registering, opening a provider account, and connecting checkout.

1. The three parts of the bill

Interchange is the fee set by the card companies and collected on every transaction. The money flows from your payment processor, known in the industry as the acquirer, to the financial institution that issued the customer's card, according to Business Development Bank of Canada, Your primer on credit card interchange fees. Interchange is the largest of several charges bundled into what is known as the merchant discount rate. The other charges compensate the processor and the card network, on the same page. Interchange represents 70% to 90% of the total fees paid by merchants, on the same page. That share is why the card mix matters more than the processor's headline rate: most of what you pay is decided by which cards your customers use, not by which processor you chose.

The second part is the network's own charges, sometimes called assessment or scheme fees. This guide states no network assessment fee figure, because none could be verified on a network or acquirer page. Do not carry an assessment figure from a secondary site into your budget: the figure that binds you is the one on your own statement or in your acquirer agreement.

The third part is the processor or acquirer's markup: the charge for authorising, clearing, settling, and supporting the sale. This guide states no processor markup figure, because that figure is set in each merchant's own agreement and could not be verified on an official page. Other charges can sit outside the per-sale stack: terminal rental and payment gateway charges are named as potential fees on the Business Development Bank of Canada page, according to Business Development Bank of Canada, Your primer on credit card interchange fees. This guide states no terminal rental or gateway fee figure, because none could be verified on an official page. Read those lines on your own statement separately from the per-sale percentage, because a low percentage with a high monthly charge can cost more than a higher percentage with no monthly charge, depending on your volume.

2. Interchange: the card, the tier, and how it was taken decide the rate

The interchange rate on a sale depends on the card the customer uses. The rate varies by credit card brand, the type of card used, and whether the transaction is in person, online, or by telephone, according to Business Development Bank of Canada, Your primer on credit card interchange fees. Interchange fees are higher on premium cards that offer rewards, cash back, and other perks, on the same page. For in-person or card-present transactions, the rate varies from 0.92% for a Mastercard that does not offer rewards to 2.08% for a Visa premium card, on the same page. For card-not-present transactions, the rate varies from 1.45% for a Visa card without rewards to 2.54% for Mastercard premium cards, on the same page. Visa and Mastercard typically adjust interchange fee rates twice a year, in October and April, on the same page — so a rate verified today is not a permanent rate.

Mastercard's own Canada table, effective August 1, 2026, gives the card-present detail. Card Present EMV rates are Core 0.92%, World 1.22%, World Elite 1.56%, and World Legend 1.95%, and Contactless rates are the same four figures, according to Mastercard, Mastercard Canada Interchange Programs. The small-business versions of those card-present rates are Core 0.70%, World 0.93%, World Elite 1.19%, and World Legend 1.25%, on the same page. Digital Commerce, the online rate, is higher: Core 1.67%, World 1.90%, World Elite 2.13%, and World Legend 2.23%, with small-business Digital Commerce at Core 1.57%, World 1.80%, World Elite 2.03%, and World Legend 2.13%, on the same page. The Standard rate, for transactions that do not qualify for a program rate, is higher again: 1.96%, 2.19%, 2.42%, and 2.53% across the four tiers, on the same page. Mastercard states that all rates are subject to change and that some rates have specific qualifying criteria, on the same page — confirm with your acquirer which program rate your transactions actually qualified for.

Visa's small-merchant rates in the TD Merchant Solutions October 2026 table show the same tier pattern. Small Merchant Electronic rates are 0.70% for Classic, Gold, and Platinum cards, 0.89% for Infinite, and 1.70% for Visa Infinite Privilege, according to TD Merchant Solutions, Visa and Mastercard interchange rates, October 2026. Small Merchant Card Not Present rates are 1.20% for Classic, Gold, and Platinum, 1.45% for Infinite, and 2.20% for Visa Infinite Privilege, and the tokenized versions are 1.15%, 1.40%, and 2.15% respectively, on the same page. Standard Visa business credit is 2.15% for Business and 2.35% for Visa Infinite Business, on the same page. Those are interchange figures only, not total cost: the network charges and the processor markup sit on top of them.

A worked example, labelled as interchange only: on a $100 card-present sale paid with a Mastercard Core card at the small-business rate of 0.70%, the interchange part alone is $0.70. On the same $100 sale paid with a Mastercard World Legend card at the standard card-present rate of 1.95%, the interchange part alone is $1.95. The difference is $1.25 on the same sale amount, from the card tier alone, before any network or processor charge. That is why two businesses on the same processor can report very different effective rates, and why a single headline percentage cannot describe what you pay.

The small-business rates, and who qualifies

In an agreement with the federal government that took effect in 2024, Visa and Mastercard significantly lowered interchange fees for small businesses with sales under $300,000 for Visa and $175,000 for Mastercard, according to Canadian Federation of Independent Business, Visa lowers interchange fees for tens of thousands of small businesses. Visa is expanding its small-merchant interchange rate to firms with up to $750,000 in annual Visa sales from October 24, 2026, and lowering rates for all qualifying businesses, while Mastercard is not expanding its program and its threshold remains at $175,000, on the same page. The threshold is Visa or Mastercard volume, not total business revenue: a business can exceed the threshold on one network and still qualify on the other, and a business that crosses a threshold can lose the lower rate. Confirm enrolment and eligibility with your acquirer, and check your statement for the small-business program rate rather than assuming it applied.

One new charge to watch, from the same CFIB release: Visa has announced plans to join Mastercard in assessing a new 1.95 cent USD fee on all domestic transactions, Mastercard will expand this fee to all transactions starting the week of the release, and Visa intends to levy the same amount starting in April 2027, according to Canadian Federation of Independent Business, Visa lowers interchange fees for tens of thousands of small businesses. These fees are first charged to card processors but are routinely passed on to small merchants, on the same page. This guide states no Canadian-dollar equivalent for that fee, because none could be verified on an official page. Watch for it as a per-transaction line on future statements, separate from the percentage interchange rates above.

3. Flat-rate versus interchange-plus: two ways of showing the same stack

A flat-rate model charges one percentage plus, commonly, one per-transaction amount, whatever card the customer uses. The appeal is predictability: every sale costs the same rate. The cost is that the single rate must cover the most expensive cards as well as the cheapest, so a business whose customers mostly pay with basic cards can pay more under a flat rate than the underlying interchange would suggest. This guide states no flat-rate percentage figure, because flat-rate figures are set by individual providers and none could be verified on a provider page. The provider-setup guide linked below states provider figures as they stood on its own pages; do not mix those figures into this guide's cost-structure comparison without rechecking the provider's current page.

An interchange-plus model passes the interchange and network charges through at cost and adds a stated markup on top. The appeal is transparency: the statement shows the interchange for each card tier, so a business can see whether it is paying for premium cards or for basic ones. The cost is complexity: the bill varies with the card mix, and the markup itself is the only part that is negotiable with the processor in the usual sense, because interchange is set by the networks. A third model, tiered pricing, groups cards into qualified, mid-qualified, and non-qualified buckets at different rates. This guide states no tiered-pricing figures and no guidance on which model is cheapest for any business, because that answer depends on the business's own card mix and volume. The honest comparison is the effective rate: divide the total card fees on a monthly statement by the total card sales for the same month, and compare that figure across months and across quotes, on the same statement basis. A quote that looks lower on a headline percentage but adds monthly, terminal, or gateway lines can have a higher effective rate once those lines are included.

4. Debit: a flat amount, not a percentage — but not the same amount for every debit

Merchants are charged a flat rate for debit card transactions regardless of the value of the purchase, according to Business Development Bank of Canada, Your primer on credit card interchange fees. That flat character is the key difference from credit: a $5 debit sale and a $500 debit sale do not scale the same way a credit sale does. The flat amount itself depends on the debit network and program. Mastercard's Canada domestic debit table lists Electronic at 0.25% plus $0.05 (CAD), Supermarket and Petroleum at 0.15% plus $0.05 (CAD), and Standard at 1.15%, according to Mastercard, Mastercard Canada Interchange Programs. Those are Mastercard debit interchange figures, not Interac debit figures, and they are not a total debit cost.

For Interac, the TD Merchant Solutions table lists Interac Flash interchange fees by tier: Tier 1 low-ticket merchants, transactions $0.01 to $100, at $0.020; Tier 2 high-volume merchants, transactions $0.01 to $100, at $0.025; Tier 3 all other merchants, transactions $0.01 to $100, at $0.035; and Tier 4 all merchants, transactions $100 to $250, at $0.055, according to TD Merchant Solutions, Visa and Mastercard interchange rates, October 2026. This guide states no general Interac debit interchange figure beyond those Flash tiers, because none could be verified on an official page. Do not assume a debit sale is free, and do not assume it costs the same as a credit sale: read the debit lines on your own statement, separated by network, before deciding whether steering customers toward debit would actually save money.

5. Chargebacks: the cost that arrives after the sale

A chargeback happens when a customer disputes a card transaction. Chargebacks can be costly for merchants: you could lose the dollar amount of the transaction, the related merchandise, and incur additional fees charged by the payment card networks, and it can take over a year to resolve a chargeback, according to TD Merchant Solutions, Chargebacks 101. The common reasons on that page are authorisation problems, cardholder disputes such as goods or services not received or credit not processed, fraudulent use of the card, and processing or point-of-interaction errors such as charging a customer twice, on the same page.

The dispute path is: the cardholder initiates a dispute and TD Merchant Solutions debits the merchant; if the merchant chooses to challenge the dispute, TD Merchant Solutions reviews it and returns it to the card-issuing bank; the issuing bank reviews the evidence with the cardholder; and if the cardholder continues, evidence from both sides is presented to the payment card network, which rules on it, according to TD Merchant Solutions, Chargebacks 101. A merchant that wishes to dispute a chargeback must respond to TD Merchant Solutions within 15 days of the debit from the account, on the same page. The documents required include legible transaction receipts, proof credit was issued, emails, contracts or messages with the cardholder, and signed proof of delivery, on the same page. This guide states no chargeback fee figure, because none could be verified on an acquirer or network page, and it states no chargeback time limit beyond the 15-day TD Merchant Solutions response window and the over-a-year resolution warning on the same page, because no other time limit could be verified on an official page.

The practical defences are unglamorous and come from the same page: use chip and PIN or tap whenever possible, be clear about return, refund, and cancellation policies at the time of purchase, obtain a signature as proof of delivery where applicable, and make sure your business name is recognisable on the customer's statement, because a cardholder may initiate a chargeback if they do not recognise the name, according to TD Merchant Solutions, Chargebacks 101. A refund is different from a chargeback: a refund is voluntary, you control it, and it returns funds to the original payment method; a chargeback is started by the customer through their bank and pulls the funds while the dispute runs. Do not issue a refund for a sale that is already the subject of a chargeback without checking with your acquirer first, because the funds may already have been debited.

6. Surcharging in Canada: credit only, capped, disclosed — and not in Quebec for consumers

Merchants have the option of adding a surcharge to a card transaction, except in Quebec, provided that the surcharge is applied in accordance with payment card network rules, according to TD Merchant Solutions, Changes for merchants who choose to apply a surcharge on card transactions. The exception is Quebec, where a consumer protection act prohibits the surcharge to customers, according to Business Development Bank of Canada, Your primer on credit card interchange fees. If you sell to consumers in Quebec, do not add a surcharge to those sales: read the Quebec consumer protection rules and your acquirer's guidance for Quebec sales before charging any payment-method fee there. This guide gives no legal advice about any single sale.

The cap is the lesser of two figures. The maximum credit-card surcharge amount must be the lesser of the effective merchant discount rate or a maximum of 2.4%, according to TD Merchant Solutions, Changes for merchants who choose to apply a surcharge on card transactions. The effective merchant discount rate can be found on the monthly statement, on the same page. In plain terms: if your effective rate is 1.9%, your surcharge cap is 1.9%, not 2.4%; 2.4% is a ceiling, not a default. Under the settlement described by the Business Development Bank of Canada, the same two limits apply in different words: surcharges cannot be higher than 2.4% of the transaction amount, and the merchant must not charge customers more than its actual interchange fee, according to Business Development Bank of Canada, Your primer on credit card interchange fees. Work the cap from your own statement's effective rate, not from the 2.4% ceiling alone.

Notice and disclosure are conditions, not courtesies. A merchant must notify its processor of its intent to apply surcharges, and a merchant accepting Mastercard credit cards must also register on the Mastercard surcharge disclosure site, according to TD Merchant Solutions, Changes for merchants who choose to apply a surcharge on card transactions. Merchants must clearly disclose that they will be applying a surcharge, including the exact amount or percentage, at the point of entry, at the point of transaction, and on the transaction receipt, on the same page. Under the settlement, the merchant must give its credit card network 30 days' notice of its intent to start charging a fee, and must also notify its processor, according to Business Development Bank of Canada, Your primer on credit card interchange fees. The same page adds the disclosure points: at the point of sale, both in store and online; at the entrance of bricks-and-mortar stores; verbally over the telephone; and on every receipt, on the same page. A surcharge may be applied in store, online, or both, according to TD Merchant Solutions, Changes for merchants who choose to apply a surcharge on card transactions.

What a surcharge cannot be combined with, and which cards it cannot touch, matter as much as the cap. Payment card network rules do not allow surcharging if a convenience fee or service fee is also applied, according to TD Merchant Solutions, Changes for merchants who choose to apply a surcharge on card transactions. Surcharges may only be applied to credit card transactions, and a merchant must not apply a surcharge on Visa Debit, Mastercard Debit, or prepaid products issued by a payment card network, on the same page. If you surcharge at the brand level, the surcharge must be the same for all credit cards for that specific payment card network, according to Business Development Bank of Canada, Your primer on credit card interchange fees. Confirm with your acquirer whether brand-level or product-level surcharging is available under your agreement before configuring a terminal or checkout, because the pages describe the brand-level rule and the acquirer's configuration is what your terminal will actually enforce.

Interac debit is not covered by the surcharge page above. TD Merchant Solutions' surcharge page covers credit card transactions only and states that a merchant must not apply a surcharge on Visa Debit, Mastercard Debit, or prepaid products, according to TD Merchant Solutions, Changes for merchants who choose to apply a surcharge on card transactions. This guide therefore states no Interac debit surcharge figure and no Interac debit surcharge procedure: do not add your own fee to an Interac debit sale, and confirm any debit-surcharge question with your acquirer before configuring a terminal or checkout.

An alternative to surcharging, with no cap and no notice regime, is a discount for a cheaper payment method. Some merchants refuse credit cards or offer discounts for using cash or debit cards, according to Business Development Bank of Canada, Your primer on credit card interchange fees. A discount is priced the other way round: the card price stays the price, and the cash or debit price is lower. That distinction matters for how the price is advertised and for the Quebec position, so confirm with your acquirer how a discount must be displayed before advertising one.

7. Before you take cards: the checklist

Read your own statement first. Find the total card fees and total card sales for a full month, divide fees by sales, and write down the effective rate. Find the interchange lines by card tier, the network lines, the processor markup, and any monthly, terminal, or gateway lines. That statement, not a headline rate, is your cost.

Check the small-business rate. Compare your Visa volume with the $750,000 threshold and your Mastercard volume with the $175,000 threshold, and ask your acquirer whether you are enrolled. If the small-business rate is not on your statement, ask why before assuming you do not qualify.

Price the card mix, not the average card. If your customers mostly pay with premium cards, budget at the premium interchange rates, not at the basic-card rates. If most sales are online, budget at the card-not-present rates, which are higher than the card-present rates on both networks' tables.

Decide on surcharging deliberately, or not at all. If you surcharge, work the cap from your effective rate, give the required notice, configure the terminal or checkout to show the exact amount or percentage, and show it at entry, at checkout, and on the receipt. Do not surcharge in Quebec for consumer sales, do not surcharge Visa Debit, Mastercard Debit, or prepaid cards, do not add your own fee to an Interac debit sale, and do not stack a surcharge on top of a service or convenience fee. If you do not surcharge, a cash or debit discount is the alternative to price — confirm its display rules with your acquirer first.

Keep chargeback evidence from the first sale. Keep the order record, proof of delivery or fulfilment, the customer's messages, and the policy the customer saw at checkout. A chargeback lost for want of evidence costs the sale, the goods, and the extra fees together.

Figures this guide does not state

This guide states no network assessment or scheme fee figure, no processor markup figure, no flat-rate percentage figure, no tiered-pricing figure, no terminal rental figure, no gateway figure, no general Interac debit interchange figure beyond the Interac Flash tiers stated, no chargeback fee figure, no chargeback time limit beyond the 15-day TD Merchant Solutions response window and the over-a-year resolution warning, no Canadian-dollar equivalent for the new 1.95 cent USD network fee, no Interac debit surcharge figure or procedure, because the canonical TD surcharge page covers credit cards only, and no surcharge figure for any individual business, because a surcharge cap is set by that business's own effective rate. It states no FCAC Code of Conduct figure or quotation, because none could be verified on an official FCAC page: the surcharging rules above rest on the TD Merchant Solutions and Business Development Bank of Canada pages cited, and the Code should be checked directly with your acquirer before acting. Each figure stated is labelled with its network, program, tier, and date or scope, and none is presented as a total cost unless it is explicitly described as an interchange-only figure.

Related guides

• How to Start Accepting Online Payments in Canada — the provider-setup intent companion to this guide: registering, opening a provider account, completing verification, and connecting checkout, rather than the cost structure explained here.

Sources

• Mastercard, Mastercard Canada Interchange Programs — Canada domestic consumer credit rates effective August 1, 2026, including card-present, small-business, Digital Commerce, Standard, and domestic debit rates
• TD Merchant Solutions, Visa and Mastercard interchange rates, October 2026 — Visa small-merchant, business credit, debit, and prepaid rates, Mastercard small-business rates, and Interac Flash tiers
• Business Development Bank of Canada, Your primer on credit card interchange fees — what interchange is, the 70% to 90% share of total fees, card-present and card-not-present ranges, the settlement surcharge conditions, and the debit flat-rate character
• Canadian Federation of Independent Business, Visa lowers interchange fees for tens of thousands of small businesses — the 2024 thresholds, Visa's expansion to $750,000 from October 24, 2026, Mastercard's unchanged $175,000 threshold, and the new 1.95 cent USD network fee
• TD Merchant Solutions, Changes for merchants who choose to apply a surcharge on card transactions — the Quebec exception, the lesser-of-effective-rate-or-2.4% cap, notice and disclosure points, the no-stacking rule, the credit-only scope with debit and prepaid exclusions, and refund treatment
• TD Merchant Solutions, Chargebacks 101 — what a chargeback is, its cost lines, the dispute path, the 15-day response window, and the documents required