Every processor quotes a headline rate. Stripe’s standard US price for online cards is 2.9% + 30¢. But almost nobody pays exactly that. The number that tells you what card processing actually costs your business is the effective rate.
What the effective rate is
Your effective rate is everything you paid in processing fees, divided by the card volume you processed, over the same period.
Effective rate = total processing fees ÷ total card volume × 100
If you paid $187,500 in fees on $6.25M of card payments last quarter, your effective rate was 3.00%. That single figure includes every per-transaction fee, percentage fee, surcharge and product fee on your statement.
Why it’s higher than the headline rate
Three things push the effective rate above the advertised percentage.
The fixed fee per charge
A 30¢ fee is 0.30% of a $100 payment, but 1.5% of a $20 payment. The smaller your average ticket, the more the fixed fee adds. At a $120 average ticket, it adds a quarter of a percentage point on its own.
Surcharges
On Stripe’s standard pricing, international cards add 1.5% and currency conversion adds 1%. A business with 15% of volume on international cards pays roughly 0.23 points more across its entire volume because of that one line.
Product fees
Stripe Billing, Radar for Fraud Teams and Stripe Tax all charge per transaction or as a share of volume. They belong in the total, because they’re part of what it costs you to take a payment.
How to calculate yours in five minutes
- In the Stripe Dashboard, pick a period of at least three full months.
- Note your total card volume for that period.
- Note your total fees for the same period, including product fees.
- Divide fees by volume and multiply by 100.
Or enter the numbers in our Stripe fee calculator, which does the arithmetic and shows what a lower rate would be worth.
Why it’s the right number for comparing offers
Headline rates aren’t comparable. One offer might be 2.7% + 30¢, another 2.4% + 50¢, and a third interchange plus 0.20% + 10¢. Which is cheapest depends entirely on your ticket size and card mix.
The effective rate removes that problem. Price your real volume and real card mix under each offer, divide by volume, and compare like with like. It’s the same method we use in our free savings analysis, and the method we recommend when you negotiate Stripe fees.
What a small difference is worth
Rates move in fractions of a point, which makes them easy to ignore. At volume they aren’t small:
| Annual card volume | 0.10 point | 0.50 point | 0.71 point |
|---|---|---|---|
| $10M | $10,000 | $50,000 | $71,000 |
| $25M | $25,000 | $125,000 | $177,500 |
| $50M | $50,000 | $250,000 | $355,000 |
That’s plain arithmetic: volume multiplied by the rate difference.
Track it every quarter
Your effective rate changes when your business changes: a new region, a shift in card mix, a new product fee. Recalculating it every quarter is the simplest way to catch pricing drift early, and the best starting point for any conversation about lowering your Stripe fees.