The way payment pricing is structured, your business is typically charged on a per-transaction basis and on a percentage of your monthly transaction volume. This means if you have a good month, then your payment processing company has a good month too. There are costs to the processor to keep merchant accounts active, so a monthly minimum fee may be imposed to protect against loss. Beware of high monthly minimums that line the pockets of the processor.

Some payment processors charge a fee when you settle your daily transactions during what's called the batch-out or settlement process. These fees tend to be low, but remember, your business is probably batching out at least once a day, so all those nickels and dimes add up over the course of a year.

Terminal fees are often charged to brick and mortar businesses for using payment terminals to accept credit cards. Gateway fees, or internet gateway fees, are the same thing except they apply to businesses that accept payments online. It's another way that some payment processing companies charge you twice for the same service. After all, they are a payment processing vendor—why are they adding a markup to credit card processing rates and then charging you extra to actually accept credit cards?

Many payment processing vendors require long-term contracts, which sometimes last as long as four to five years. The penalty for canceling that contract is a hefty early termination fee. A payment processing company with a signed contract could potentially charge you for the full amount of fees they expected to capture from your business over the entire course of the contract term. That can easily be thousands of dollars! The kicker is that the same companies that charge early termination fees are usually the ones that also charge other hidden fees. Be aware of large Early Termination Fees.

This is a fee some payment processors charge to cover their costs, and it should be a big red flag to stay away. Payment processing companies already charge a markup to the fixed base rates charged by credit card issuing banks and credit card associations (Visa, Mastercard, etc.). The markup they charge is meant to cover the processor's costs and ensure they're making a profit. If the company charges an additional annual fee, they're hitting you with a junk fee to line their own pockets.

PCI compliance is a real thing. The Payment Card Industry has created a set of data security standards to make sure customer credit card data is handled safely and securely. In layman terms, it means making sure you're taking the appropriate precautions to prevent people from hacking your customers' credit card data. This is a shared responsibility between you and your payment processor. Minor PCI fees are normal. Huge penalty fees for PCI Compliance or Non-compliance are not.