The true cost of taking payments — and how to reduce it

How hotels and restaurants can understand — and reduce — what they pay to accept card payments.

Executive summary. The cost of accepting a card payment is not one fee. Behind the processing percentage on your merchant statement sit several distinct costs — interchange, card scheme fees, acquiring, and the margin of the payment technology you use — plus operational costs that never appear on a statement at all. Some are set by regulation or by the card networks, and that regulation differs from market to market. Others are commercial, and can be reviewed, negotiated or restructured as your payment volume grows. This article gives finance leaders a three-level framework for thinking about payment costs — card economics, acceptance economics, and the total cost of payments — and nine practical ways hospitality businesses reduce that total cost without degrading the guest experience. It is written for groups operating across continental Europe, Switzerland, the UK and further afield.

What happens when a guest pays 100?

A guest checks out and pays 100 on a Visa debit card. Assume a payment value of 100 — CHF, EUR or GBP; the cost structure is the same, even though actual rates, regulation and acquiring arrangements vary by market. The hotel does not simply pay "a card fee". The transaction moves through a chain of parties, several of which take a share of the economics — authorisation in seconds, settlement separately over the following days.

The main components that can sit inside the merchant's cost:

• Interchange — paid to the bank that issued the guest's card.
• Card scheme fees — paid to the network (Visa, Mastercard) for running the rails.
• Acquiring cost — paid to the acquirer that processes the transaction and settles the money to you.
• PSP / gateway / platform margin — paid to whichever payment technology provider sits between your systems and the acquirer.
• Cross-border and currency costs — where the card was issued in another country or the payment involves conversion.
• Other contracted services — fraud tooling, tokenisation, reporting, terminals, PCI programmes.

Not every provider itemises these separately, and not every provider stacks them the same way. Many merchants pay a single blended rate that wraps all of the above into one number. That is convenient — but it means the statement tells you the price you pay, not the costs underneath it.

That distinction — underlying payment cost versus the commercial price you pay — is the foundation of everything that follows.

For how these parties connect to the hotel's own systems, see how hotel payment gateways work.

Three levels of payment cost

It helps to separate payment costs into three levels. Each level contains the one before it.

Level 1 — Card economics. The underlying interchange and card-scheme/network costs associated with processing card payments. These are set by regulation or by the card schemes, not by your provider.

Level 2 — Acceptance economics. Card economics plus the commercial and technology cost of actually accepting the payment: acquiring margin, PSP/gateway/platform fees, terminals, fraud tooling, tokenisation and other contracted payment services. This is the level your merchant statement describes — and the level where commercial arrangements differ between merchants.

Level 3 — Total cost of payments. Acceptance economics plus the economic and operational consequences of managing payments: failed legitimate payments, reconciliation, settlement investigation, exception handling, refunds, manual finance work, and integration complexity. Much of this level never appears on any statement — it is paid in lost revenue and salaries.

The single most important idea in this article follows directly:

Don't optimise the processing rate. Optimise the total cost of payments.

A decision that trims Level 2 while inflating Level 3 — a cheaper rate with worse authorisation performance or messier reconciliation — is not a saving. Level 3 is also the hardest level to see, because nothing reports it: operational intelligence is the discipline of surfacing where that cost is actually concentrating.

How regulation changes the cost stack

Card economics are not identical globally. Interchange regulation, scheme rules, domestic card networks and acquiring structures vary by market — so the first step for any international group is to establish which rules actually apply where it operates.

For example, interchange on domestic consumer-card transactions in the EEA is capped at 0.2% for debit and 0.3% for credit under the EU Interchange Fee Regulation, with equivalent domestic consumer caps in the UK. These caps apply to both card-present and card-not-present domestic consumer transactions. On a 100 domestic consumer debit payment, interchange is 0.20 in the local currency; on consumer credit, 0.30.

It does not follow that all interchange sits at those levels, even inside those markets:

• Commercial and corporate cards are outside the consumer caps. Their interchange is set by the card schemes and typically runs materially higher than consumer rates. For hotels with heavy corporate and travel-programme business, this is a real cost driver.
• Cross-border transactions are treated differently again — covered next, because the detail matters for hospitality.

Switzerland and other markets sit outside the EU framework and have their own regulatory position, scheme rules and acquiring economics. International hospitality groups therefore need to understand payment costs market by market, rather than applying one country's headline rate across the estate.

The remaining acceptance cost can include scheme fees, acquiring cost and other commercial or service charges — some reflecting genuine services and some worth examining as payment volume and requirements change.

A cross-border example: UK–EEA card-not-present payments

Cross-border economics are where geography and channel show up most sharply. The UK–EEA corridor is a well-documented example, and the pattern it illustrates applies wherever a payment crosses a regulatory boundary.

Since the UK left the EU, the EU caps no longer apply between the UK and the EEA. Mastercard and Visa subsequently increased interchange on UK–EEA card-not-present consumer transactions from the previously capped 0.2%/0.3% to approximately 1.15% (debit) and 1.5% (credit) — roughly five times the former level. The UK Payment Systems Regulator's market review (final report, December 2024) concluded these increases were not justified by competition and estimated they cost UK businesses in the range of £150–200 million a year.

Note the scope: card-not-present. This is precisely why the issue lands harder on hospitality than the headline suggests. A hotel's payment mix routinely spans both channels:

• Card-not-present: online bookings, pre-arrival deposits, Pay-by-Link, no-show charges, group and event deposits, virtual/agent payments — exactly the flows where a card issued in one region and accepted in another attracts elevated cross-border CNP rates.
• Card-present: reception check-out, restaurant and bar terminals, spa — where different (generally lower) cross-border rates and rules apply.

Two properties with identical volume can therefore carry very different interchange bills depending on how much of their revenue arrives before the guest does, and where their guests' cards are issued. Understanding your CNP share by issuing geography is one of the highest-value pieces of analysis a hospitality finance team can run — in any market.

Regulatory status of this example (as at September 2026): the PSR concluded these fees should be capped, but decided in October 2025 not to proceed with an interim cap, opting to set a single lasting cap once its methodology work concludes. In January 2026 the High Court confirmed the regulator's power to impose such a cap, rejecting a challenge from Visa, Mastercard and Revolut. The level and timing of the cap were still being determined at the time of writing — so the elevated rates remain payable today, with a cap likely but not yet in force. Check current status, in each market you operate in, before relying on any number.

What are you actually paying for?

Interchange

What it is: a per-transaction fee the acquirer pays to the card issuer, passed through to the merchant. Who receives it: the guest's bank. How it varies: by card type (consumer debit/credit vs commercial), by geography (domestic, intra-EEA, cross-border, international), and by channel (card-present vs card-not-present). What you control: not the rates — but your mix determines your bill, and your pricing model determines whether you see interchange at cost or wrapped in a blend.

Scheme and network fees

What they are: fees Visa and Mastercard charge acquirers for access to the network — authorisation, clearing, settlement, plus a growing list of mandatory and optional services. They are passed through to merchants directly or inside the blended rate. They are not the acquirer's profit — they leave the acquirer and go to the scheme.

They are also rising, and hard to see. The PSR's market review of scheme and processing fees (final report, 2025) found that Mastercard and Visa increased core scheme and processing fees to acquirers by at least 25% in real terms between 2017 and 2023 — costing UK businesses at least £170 million more per year — and concluded that the information provided by the schemes was not sufficiently clear and detailed, creating costs for acquirers and merchants trying to understand what they are paying. That regulatory finding is worth internalising: if the regulator concluded that professional acquirers struggle to decode these fees, an individual hotel group should not assume its statement is self-explanatory.

Acquiring

The acquirer is the regulated institution that processes card payments for the merchant and facilitates settlement. Acquiring is where commercial arrangements differ most between merchants — and where the pricing model matters.

Blended pricing gives you one rate for everything. It is simple, predictable, and often sensible at lower volumes. Its weakness: you cannot see how much of the rate is Level 1 cost versus margin, and you don't automatically benefit when your card mix is cheap (lots of domestic consumer debit, for example).

Interchange++ (IC++) passes through interchange and scheme fees at cost, plus a disclosed acquirer margin. It is transparent and typically rewards a favourable card mix — but statements are more complex, costs fluctuate month to month, and it demands more from your finance team.

Neither is universally better. Blended suits simplicity and lower volumes; IC++ tends to become worth the complexity as volume and international mix grow, because transparency is what makes negotiation possible.

The PSP / payment platform layer

If a provider sits between your systems and the acquirer, you are paying for more than processing: integration into your PMS or POS, tokenisation, fraud tools, reporting, developer tooling, international acceptance, support, and a single consolidated commercial relationship. These have genuine economic value — rapid implementation and one contract are worth real money, especially for a smaller operation.

So the right question is not "is my PSP expensive?" It is:

Are we paying for capabilities we actually value, at a price that still makes sense at our current transaction volume?

The answer changes as you grow. A model that was exactly right at 5m of annual volume may deserve a fresh look at 50m.

Which payment costs can you control?

Nine ways hotels and restaurants can reduce payment costs

1. Know your effective payment rate. Ignore the advertised rate. Calculate: total payment-related cost ÷ total processed payment value. Include acquiring fees, gateway/platform fees, terminal charges, chargeback fees and currency costs; decide deliberately whether to include Level 3 operational cost, and be consistent. Use several months of data, not one statement — seasonality and card mix move the number. This is the baseline every other lever depends on.

2. Actually read the merchant statement. Break down transaction volume, payment methods, card mix (consumer vs commercial), domestic vs international, card-present vs card-not-present, refunds, chargebacks and every additional line item. Then reconcile what you were charged against what your contract says. The PSR found that unclear fee information imposes real costs even on professional participants in this market — the practical answer is periodic, structured statement review rather than assuming the numbers look after themselves.

3. Negotiate on real volume. Payment pricing is commercial. A property or group that signed its acquiring agreement at 3m of annual payment volume and now processes 15m has a very different commercial profile, and a different conversation available to it. Negotiation doesn't guarantee a lower rate, but well-evidenced, growing volume changes commercial leverage, and providers expect the discussion.

4. Understand blended vs IC++. As volume and international mix grow, the transparency of IC++ usually becomes worth the statement complexity — you can finally see what is cost and what is margin, which is the precondition for lever 3.

5. Evaluate direct acquiring. At sufficient scale, it is worth asking whether a more direct commercial relationship with an acquirer makes sense. The potential upside: pricing transparency, potentially stronger economics at volume, and direct commercial negotiation. The trade-offs are real: greater complexity, integration and certification work, multiple contracts if you operate across countries, operational responsibility, and potentially fragmented reporting if nothing sits above the acquirers. Direct acquiring is not automatically cheaper, and it is not the right answer for every business — but at sufficient scale, the question becomes worth asking.

6. Understand your acquiring geography. Where and how your transactions are acquired can affect interchange classification, scheme and cross-border fees, FX treatment, regulatory treatment and potentially authorisation performance. The outcome depends on the interplay of issuer and acquirer geography, your merchant entity structure, the card, the channel, scheme rules and your provider's architecture — there is no universal rule. The practical action for multi-country groups: find out where each market's transactions are actually being acquired today, and what that means economically.

7. Review which acquiring contract sits behind each terminal. Hotel and restaurant groups often accumulate payment infrastructure over time. Properties open at different dates, terminals are replaced, acquiring agreements are renegotiated, outlets are added, and regional arrangements change. The result can be an estate where different terminals — sometimes within the same group — are mapped to different or legacy acquiring contracts. Knowing your headline group acquiring rate is therefore not enough. Ask:

• Which acquirer and contract is each terminal mapped to?
• Which merchant or legal entity does it belong to?
• When was that commercial agreement last reviewed?
• Are similar outlets or properties paying materially different rates?
• Are legacy contracts still active where newer terms should apply?
• Does the terminal estate reflect the acquiring strategy the group believes it has?

Inconsistency does not automatically mean a contract is bad or expensive — the objective is visibility and comparison. It matters most for multi-property and multi-country groups, where arrangements fragment quietly over time.

8. Improve authorisation performance. A lower fee is worse economics if more legitimate payments fail. A legitimate payment that fails creates recovery effort, guest friction and, in some cases, lost revenue — costs that can quickly outweigh a few basis points saved on processing. Track approval rates by channel and market, and ask providers to explain material differences. The right question is the cost of successful payments, not the cost of attempts.

9. Reduce the operational cost of payments. Reconciliation, settlement investigation, exception handling, refunds, failed-payment chase-ups and month-end matching are payment costs — they're just paid in salaries instead of basis points. A finance team spending days each month matching acquirer settlements to PMS folios and bank statements is carrying a Level 3 cost no statement shows. At group scale, reducing that manual workload can be economically significant — and it belongs in the payment-cost calculation. For the operating controls behind that work, see the hotel payment SOP and reconciliation framework.

Why the cheapest processing rate isn't always the cheapest payment

The quoted rate lives at Level 2; your P&L experiences Level 3. Weigh the rate against authorisation performance, payment-method coverage, settlement speed, quality of reconciliation data, integration cost into your PMS/POS, reliability, support and geographic coverage.

The better question:

What is our effective cost of successfully accepting and managing a payment?

That number includes fees, failures and finance-team effort. It is the number worth minimising.

Where payment orchestration fits

Follow levers 5 and 6 far enough and a structural question appears. A hospitality group at scale might reasonably want: direct relationships with one or more acquirers; different acquiring arrangements by country; local and alternative payment methods; central visibility of every transaction; deep integration into PMS and POS; consistent tokenisation across channels; and consolidated settlement and reconciliation.

Direct acquiring alone doesn't provide that — it improves the commercial terms while multiplying the moving parts. This is the problem a payment orchestration / integration layer exists to solve: one layer connecting your operational systems to the payment infrastructure underneath, so acquiring can be chosen on economics while operations stay unified.

The main architectural and commercial options are:

Bundled PSP · negotiated processing · direct acquiring · orchestrated / multi-acquirer payments

These are choices, not stages of maturity. A sophisticated group can legitimately conclude that a bundled provider gives it the best overall economics once simplicity, implementation cost and internal effort are counted — that is a valid architectural decision, not an interim one. Orchestration earns its place specifically when a business wants to combine things a single bundled relationship can't: multiple acquirers, different geographic arrangements, alternative payment methods, PMS/POS integration, central visibility, tokenisation, settlement and reconciliation in one operational layer.

The right architecture depends on payment volume, countries, number of brands and properties, operational complexity, internal payments expertise and existing agreements.

Can DCC offset some payment costs?

Dynamic Currency Conversion (DCC) applies to eligible international cardholders, where DCC is available through the acquiring setup in use: at the point of payment the guest can choose to pay in your local currency, or in their home currency at a disclosed exchange rate and markup. The guest sees both amounts and the rate; the choice must be genuinely and clearly theirs. Forced or unclear DCC breaches scheme and regulatory requirements — done badly it damages trust; done properly, some guests genuinely prefer the certainty of seeing the charge in their own currency.

Commercially, depending on the merchant's agreement, the merchant may participate in the conversion economics — DCC revenue share on eligible transactions where the guest opts in. For hospitality businesses with a significant international guest mix, this participation income can partially offset the cost of card acceptance. It is not guaranteed income — it depends on guest mix, opt-in rates and contract terms — and it does not replace good underlying payment economics. Treat it as an offset, never as the plan.

Payments and guest experience: Pay at Table

Payment architecture also shows up in Level 3. Restaurants make the point clearly: where a bill is settled table-side — by staff on a portable device, or by the guest from their own phone via a QR code at the table — the payment posts back to the POS against the right check and reconciles automatically, instead of generating exceptions for the finance team to unpick later.

Reducing payment cost and improving guest experience are therefore not opposing goals: a flow that posts cleanly and reconciles itself lowers the total cost of payments while making checkout better. For how this works in practice, see Pay at Table.

Where 934 fits

If you've read this far, the shape of the challenge is clear: retaining the integration and operational simplicity a hospitality business needs, while gaining greater control and transparency over the payment and acquiring infrastructure underneath.

That layer is what 934 builds. 934 is a payment technology and integration provider, not an acquirer: the Juno platform sits between hospitality operational systems and the regulated payment providers underneath it.

On the hospitality side, Juno is integrated with PMS and POS platforms including Oracle Hospitality — OPERA Cloud, OPERA 5 and Oracle Simphony — together with Shiji, SIHOT and Infor.

On the payment side, it connects acquiring through partners including Worldline and Getnet, alongside local payment methods, DCC, Pay-by-Link and Pay at Table — and carries the financial back office: settlement ingestion, automated reconciliation and clean posting into the ERP.

The practical outcome: a hotel or restaurant group keeps the operational integration and guest payment experience it needs, gains transparency over the acquiring economics underneath, and reduces the Level 3 cost associated with manual reconciliation and payment operations.

If your business processes meaningful volume and hasn't reviewed its payment structure recently, that review is usually worth an afternoon.

12 questions to ask about your payment costs

Levels refer to the three-level cost model above.

1. What is our total annual card and payment volume, by market, channel and card-present/card-not-present split?
2. What is our effective payment cost in basis points — total fees ÷ processed value, over 6–12 months? (Level 2)
3. How much of that cost is interchange and scheme fees, and how much is commercial margin? (Level 1 vs 2)
4. Are we on blended or IC++ pricing — and do we know why?
5. What proportion of our volume is commercial cards, international or cross-border — and how much of the cross-border volume is card-not-present?
6. Are our rates still appropriate for our current volume, or were they set when we were smaller?
7. Which acquiring contract is mapped to each terminal, property and merchant entity?
8. Are comparable properties or outlets operating on inconsistent or legacy acquiring terms that deserve review?
9. What is our authorisation approval rate by channel and market? (Level 3)
10. Would direct acquiring — in one or more markets — be worth evaluating at our scale?
11. What do reconciliation, exception handling and failed payments cost us operationally each month? (Level 3)
12. Could DCC participation responsibly offset part of our acceptance costs, given our international guest mix?

What a few basis points are worth

Basis points make small differences legible: 10 basis points (bp) = 0.10%.

Illustrative mathematics only. These are not projected savings from 934 or any other provider. The point stands regardless of provider: differences that look trivial on a statement become strategically important at group scale — and they compound every year.

Key takeaways

1. The processing percentage on your statement is a price, not a cost breakdown — interchange, scheme fees, acquiring and platform margin all sit inside it.
2. Think in three levels: card economics, acceptance economics, and the total cost of payments — and optimise the third, not the first number on the statement.
3. Card-cost regulation varies by market: domestic consumer interchange is capped at 0.2%/0.3% in the EEA and the UK, while commercial cards, cross-border transactions and other markets sit outside those caps — and hospitality's deposit and pre-arrival flows are exactly where the card-not-present exposure sits.
4. For groups, acquiring cost is not only a contract question — it is an estate-management question. Know which contract, acquirer and merchant arrangement sits behind each terminal and payment flow.
5. Measure your effective payment rate over months, not one statement.
6. The lowest quoted rate is not the lowest cost: authorisation performance and operational effort are part of payment economics.
7. Bundled PSP, negotiated processing, direct acquiring and orchestration are architectural choices, not a maturity ladder — re-ask which fits as volume and complexity change.
8. Payment cost and guest experience are not a trade-off when the architecture integrates properly with your PMS, POS and finance systems.

Glossary

Acquirer — The financial institution or payment organisation that processes card transactions for the merchant and settles funds to the hotel.

Authorisation — Approval from the payment chain that funds or credit are available for a proposed transaction.

Payment gateway — The layer that connects hotel workflows to payment infrastructure, carrying transaction instructions and responses between them.

Payment provider / PSP — The platform or provider handling payment transactions between the hotel and the acquiring/payment network.

PMS (Property Management System) — The hotel system used to manage operational information including reservations, stays, rooms and guest folios.

Reconciliation — The process of comparing related financial records and explaining or resolving differences.

Settlement — The movement and reporting of funds from the acquiring/payment chain to the merchant.

Tokenisation — Replacement of sensitive card data with a token that can be used within the permitted payment environment without repeatedly exposing or storing the underlying card number.

Primary sources

• UK Interchange Fee Regulation / EU Interchange Fee Regulation (2015) — domestic consumer caps 0.2%/0.3%: https://www.psr.org.uk/our-work/interchange-fee-regulation/
• PSR — Market review of UK-EEA consumer cross-border interchange fees: Final report (MR22/2.7, December 2024): https://www.psr.org.uk/our-work/market-reviews/market-review-into-cross-border-interchange-fees/
• PSR — Decision not to proceed with an interim cap on cross-border interchange fees: statement of reasons (MR22/2.9, 10 October 2025): https://www.psr.org.uk/publications/market-reviews/mr2229-decision-not-to-proceed-with-interim-cap-on-cross-border-interchange-fees-statement-of-reasons/
• PSR — Consultation on the methodology for developing a price cap remedy (MR22/2.8, October 2025): https://www.psr.org.uk/our-work/market-reviews/market-review-into-cross-border-interchange-fees/
• High Court judgment, 15 January 2026 — the PSR's power to cap cross-border interchange fees upheld against the Visa, Mastercard and Revolut challenge, as reported: https://www.fstech.co.uk/fst/Visa_Mastercard_Revolut_Lose_Challenge_To_PSRs_Cross_Border_Card_Fee_Cap.php
• PSR — Market review of card scheme and processing fees: Final report (MR22/1.10, 2025): https://www.psr.org.uk/publications/market-reviews/mr22110-market-review-of-card-scheme-and-processing-fees-final-report/
• Visa and Mastercard published interchange schedules (UK/EEA domestic, commercial and cross-border rates) — current editions on the scheme websites.

Regulatory and numerical claims in this article were checked against these sources on 7 September 2026. Card-fee regulation is moving; confirm the current position before relying on any figure commercially.