High Fees in Online Payments: A Real Roadblock for SMBs
February 6, 2025
Running an online store can feel like juggling a million tasks at once. Between managing inventory, marketing your brand, and keeping your customers happy, the last thing you want to worry about is getting squeezed by payment fees. Yet, for many small and medium-sized businesses (SMBs) in the digital world, high processing costs are a major pain point. These fees don’t just nibble at your profits—they can make or break your ability to grow, innovate, or even survive.
Below, we’ll dive into why online payment fees are such a headache, discuss why card rails aren’t your only option (especially for those of us in Europe), and explore how you can overcome these challenges to keep more of what you earn.
The True Cost of Accepting Online Payments
In the fast-paced world of e-commerce, accepting digital payments has become non-negotiable. Customers expect smooth, speedy checkout processes—most often involving debit or credit cards. However, as many online merchants quickly learn, these conveniences aren’t free. Below are some of the common (and sometimes hidden) costs you’ll likely encounter:
- Base Fees
A percentage of the sale plus a flat, per-transaction fee. - Monthly or Annual Costs
Recurring charges to maintain your payment gateway or merchant account. - Setup Fees
One-time costs for initial onboarding and integration. - Cross-Border and Currency Conversion Fees
Extra expenses if you sell internationally or deal with multiple currencies. - Scheme Fees
Charges by the card networks on each transaction—often a mix of flat rates and variable percentages. - Interchange Fees
Payments from your acquiring bank to the cardholder’s bank, varying by card type, region, and transaction details (domestic vs. international, credit vs. debit, etc.). - Daily Payouts and Reconciliation
Some providers charge more for quicker payouts or advanced reconciliation features—important considerations if you rely on a steady cash flow or real-time visibility into your transactions. - Additional Costs for Enterprise-Level Features
Even if you’re a small or medium business, you might need “premium” capabilities like advanced fraud protection or custom reporting. These can come with their own hefty price tags.
For SMBs operating on tight margins, every percentage point shaved off your revenue can feel crippling—especially when you’re competing with bigger players who often negotiate lower rates due to their higher volume. Understanding these fees is the first step toward navigating the complex landscape of online payment costs.
Why High Fees Hurt Online SMBs the Most
- Shrinking Margins
Every extra percent in fees is money that can’t be reinvested in marketing, inventory, or improving your site’s user experience. - Missed Opportunities
If processing fees are too high, some SMBs avoid adding new payment options (like digital wallets or international payment methods). But fewer options can lead to fewer conversions. - Uneven Playing Field
Big businesses can score bulk discounts on processing fees. SMBs often don’t have that bargaining power, putting them at a competitive disadvantage. - Cash Flow Struggles
Delayed payments or withheld funds can wreak havoc on day-to-day operations, especially when you need cash to restock or invest in new marketing campaigns.
The Hidden Barrier: Integration for Multiple Payment Methods
While credit cards might be the most common online payment option, they’re far from the only game in town. Alternative methods—like direct bank transfers, digital wallets, or local European payment schemes such as SEPA—often come with lower fees. But for many SMBs, integrating these methods can feel daunting:
- Technical Hurdles: Each payment method has its own integration process, requiring time, resources, and sometimes specialized development expertise.
- Compliance & Regulations: Handling direct bank transfers or local payment methods can involve navigating complex regulatory requirements (especially when it comes to European banking standards).
- Limited Resources: Smaller businesses often lack the internal IT teams or budgets to implement multiple payment rails seamlessly.
The end result? SMBs can get stuck paying higher fees on card transactions simply because it’s the path of least resistance—or the only payment option they can easily handle.
Card Rails vs. Alternative Payment Methods (Especially in Europe)
For European online sellers, card rails can be painfully expensive when compared to local bank transfers (like SEPA):
- Card Rails: Fees vary, but you’ll generally pay a percentage fee plus a flat fee per transaction. These can quickly add up, especially for bigger ticket items.
- SEPA & Other Local Methods: European bank transfers often have much lower transaction costs—and in some cases can be nearly free once set up. Plus, SEPA payments can offer quicker settlements than some card networks.
Why Should SMBs Care?
Reducing payment processing costs by even 1% on your monthly sales can lead to thousands in yearly savings—money that’s better spent on customer acquisition, better marketing, or new product development.
Optimizing and Incentivizing Cheaper Payment Methods
To truly level up your online checkout experience while keeping fees in check, it’s worth prioritizing and even incentivizing the use of cheaper methods like SEPA transfers if you’re selling to a European market. Here’s how:
- Highlight Cheaper Methods: Nudge customers toward SEPA or local bank transfers by labeling them as “preferred” or “discounted” payment options at checkout.
- Educate Your Customers: Many people simply pick the first payment method they see. A little note explaining that certain options are more cost-effective and secure can go a long way.
- Offer Incentives: Consider small discounts, loyalty points, or free shipping for choosing SEPA to offset any minor inconvenience.
- Streamline the Experience: Make sure your checkout for alternative payment methods is as smooth and intuitive as card checkout. Friction will push customers right back to card payments.
There Has to Be a Better Way
What can we do to reduce these fees and remove integration headaches?
- Simplify Pricing
A transparent, flat-fee structure helps SMBs predict costs and plan accordingly. - Tailored Solutions
Processors need to step up with packages designed specifically for smaller online merchants. No wasted features, no hidden fees—just the essentials done right. - Awareness & Education
SMBs benefit hugely when they know all their options. Sometimes a simple heads-up about alternative payment rails can save thousands in fees.
How Maksu Helps Online SMBs Thrive Without Breaking the Bank
At Maksu, we’re all about empowering small and medium-sized online merchants to succeed in an increasingly competitive (and expensive) payment landscape. We’ve built our platform with SMBs in mind:
- Straightforward, Transparent Pricing: No surprises. You’ll know exactly what you’re paying for, so you can manage your budgets with confidence.
- Easy Integration (Even for Non-Techies): Whether you’re using Shopify, WooCommerce, or a custom-built store, our integrations are designed to be hassle-free.
- European-Friendly Payment Rails (Like SEPA): We make it easy to accept SEPA transfers, drastically cutting down your processing fees and giving you faster settlements.
- Card and Alternative Payment Methods: Offer your customers the convenience of cards and cheaper local methods—all in one place.
- Dedicated Support and Success Manager: We know online payments can be tricky. We’re here to help every step of the way, from setup to day-to-day troubleshooting.
If you’re tired of feeling like payment processors are taking too big a slice of your profits, Maksu might be exactly what you’re looking for. We don’t just provide a service; we’re here to partner with you, so you can keep more of your hard-earned money and grow your online business without unnecessary overhead.
The Most Important Factors for Online SMBs When Choosing a Payment Processor
Choosing the right payment partner can feel like a minefield. There are endless promises, features, and pricing tiers to sort through. But in my experience, it boils down to a few key considerations:
- Clear and Fair Pricing
Let’s face it—no one likes hidden fees. With tight margins, SMBs need straightforward pricing to budget effectively. - Ease of Use
You’re already juggling shipping, marketing, and inventory. Your payment processor shouldn’t be a headache. Pick someone that integrates easily with your platform. - Payment Options (Including Cheaper Methods)
Customers love choice, but you should too—especially if some options are cheaper. If your processor only offers card rails, you’re missing out on lower-cost methods like SEPA. - Security & Trust
Fraud is no joke. Make sure your payment processor is on top of PCI-DSS compliance and offers robust fraud detection to protect your store and your customers. - Scalability
Maybe you’re a small shop today, but tomorrow you could be shipping across the globe. Ensure your processor is ready to handle your growth without additional headaches. - Fast and Helpful Support
Payment issues can be scary. You want a processor that’s easy to reach and quick to solve problems—before they hit your bottom line. - Local and Global Reach
If you sell internationally, check whether your processor supports multiple currencies and local methods. Customers are more likely to complete a purchase if they can pay the way they’re used to.
Why Maksu Is the Perfect Choice for Online SMBs
At Maksu, we’ve designed our entire approach around making life easier for online sellers:
- Transparent Pricing: No hidden or confusing fees.
- Seamless Integration: Simple plugins and APIs mean you can start accepting payments without the usual headaches.
- Cost-Effective Payment Methods: We put an emphasis on European-friendly rails like SEPA, helping you dodge high card fees.
- Bank-Grade Security: Sleep easy knowing your transactions are protected.
- Room to Grow: As your sales volume skyrockets, our tools and features scale right along with you.
- Dedicated Support & Success Manager: Because nothing’s worse than being stuck on hold when your checkout is down.
We get it—every euro (or dollar) counts when you’re trying to stand out online. That’s why we’re committed to helping you cut unnecessary costs, simplify your payment setup, and give your customers multiple ways to pay (without making you pay through the nose).
