How to read your merchant statement and find your effective rate
Your effective rate is every fee on the statement added together, divided by your card turnover for the same month. That is the whole formula. The rate you were quoted is one line on the page; the effective rate is the page. Below is what each line means, a worked example that turns a 1.1% quote into a 1.74% reality, and what to do with the number once you have it.
The formula
Effective rate = total fees ÷ card turnover × 100
Use the same month for both numbers. Include every charge on the statement: percentage fees, pence-per-transaction fees, rental, PCI, minimum charges, chargebacks, paper billing, VAT where it is charged.
Do it for three months, not one, because chargebacks and minimum charges are lumpy. If your turnover swings with the seasons, do a busy month and a quiet month separately; the gap between them tells you how much of your bill is fixed cost.
The lines, one by one
| Line | What it is | What to check |
|---|---|---|
| Merchant service charge (MSC) | Percentage of card sales, often split by card type | Does each card-type rate match the fees schedule? Which type is most of your volume? |
| Authorisation fees | Pence per transaction, charged on every authorisation attempt | Multiply by your transaction count; on small tickets this can exceed the MSC |
| PCI management / non-compliance | Monthly compliance fee, or a penalty while non-compliant | Is it in the schedule? Has your questionnaire lapsed? |
| Minimum monthly service charge | Top-up when transaction fees fall below a floor | Appears only in quiet months; compare against your quietest month |
| Terminal rental | Fixed monthly charge per device | How many devices? Is each one still in use? |
| Chargebacks and refunds | Per-event fees when a payment is disputed or refunded | Review sites report Dojo at £28 + VAT per chargeback and 50p per refund |
| Paper billing / other | Statement fees and sundries | Switch to online statements if there is a paper charge |
Dojo chargeback, refund and paper billing amounts from review sites, checked August 2026; Dojo's own fees schedule governs your account.
Merchant service charge
The MSC is the percentage fee and it is usually split by card type. On an interchange-plus account you will see interchange, scheme fees and margin as separate sub-lines; on a blended account you see one rate per card type. Either way, look at which card type carries most of your turnover. A great debit rate and a poor commercial-card rate is a fine deal for a cafe and a poor one for a trade counter. Our interchange-plus vs blended piece explains the difference.
Authorisation fees
A few pence per transaction, charged on every authorisation whether or not the sale completes. People skip this line because the unit is tiny. Multiply it out. At 5p on 480 transactions it is £24, which on £12,000 of turnover is 0.2%, the same as the entire interchange cap on a debit card. On small-ticket trades it is often the second-largest line. More on our authorisation fee page.
Fixed charges
Rental, PCI and the minimum monthly charge do not move with your sales, which means they hit hardest in your quietest month. They are also the charges most often left out of a sales conversation. Each has its own guide on this site: PCI compliance fee and minimum monthly service charge.
A worked example
The statement below is illustrative: a single terminal, £12,000 of card sales, one chargeback in the month. The rates are round numbers, not any provider's quote.
| Line | Amount | Note |
|---|---|---|
| Card turnover | £12,000.00 | 480 transactions, average £25 |
| MSC at 1.1% blended | £132.00 | Illustrative rate |
| Authorisation fees, 480 × 5p | £24.00 | |
| PCI management | £4.95 | Illustrative; varies by provider |
| Terminal rental | £20.00 | |
| One chargeback | £28.00 | Plus VAT in practice |
| Minimum monthly charge | £0.00 | Not triggered; fees exceed the floor |
| Total fees | £208.95 | |
| Effective rate | 1.74% | £208.95 ÷ £12,000 |
The owner of this account was quoted 1.1%. They are paying 1.74%. Nothing on the statement is wrong or hidden; it is simply that the quote described one line and the bill has seven. Take the chargeback out and the effective rate is still 1.51%. That is the number to carry into any comparison, and the number any competing quote has to beat after its own fixed charges are added.
What to do with the number
Compare it with the pay-as-you-go flat rates: SumUp 1.69%, Square and Zettle 1.75%, all with no fixed charges. If your effective rate is above those, a contract is costing you more than a reader would
Ask your current provider for a bespoke summary box of your fees. Under PSR Specific Direction 14, providers may not charge for one
Check your contract end date. Under PSR Specific Direction 15, directed providers must send a reminder 31 days before the minimum term ends, with a link to their online quotation tool
Put the statement next to any new quote and work out the new effective rate on the same turnover before you sign
If you would rather not do the arithmetic, our free fee check does it from a photo of your statement, and our fee comparison calculator models the alternatives.
When a high effective rate is not a reason to switch
A high effective rate on a tiny turnover is usually not worth acting on. £30 of fees on £900 of sales is 3.3%, which looks awful, but the saving from any switch is a few pounds a month, and an early exit fee would wipe out years of it. Likewise, a month with two chargebacks will look bad and tell you nothing about the underlying deal. Look at the trend over a quarter and at the pounds, not just the percentage. If you are inside a minimum term, our stuck in a contract page sets out what the PSR rules say about exit fees.
Send us your statement and we will work out the effective rate for you.
No obligation. If a Dojo quote would come out lower we will show you the comparison line by line; if it would not, we will say so.
Compare my feesCapExpand is an authorised Dojo partner and is paid by Dojo when a business signs up through us. That does not change the price you pay.
Frequently asked questions
What is the effective rate on a merchant statement?
Total fees for the month divided by total card turnover for the month, expressed as a percentage. It includes every charge on the statement, not just the transaction percentage, and it is the only number that lets you compare two providers with different fee structures fairly.
What does MSC mean on my statement?
Merchant service charge. It is the percentage fee on your card sales, usually broken down by card type (debit, credit, commercial, international). It is normally the largest line, but on a low-volume account the fixed charges underneath it can add up to more.
Why is my effective rate higher than the rate I was quoted?
Because the quoted rate was the merchant service charge on one card type, and the statement adds authorisation fees, terminal rental, a minimum monthly charge, PCI charges and any chargebacks or refunds. A 1% headline rate with £40 of fixed charges on £4,000 of turnover is a 2% effective rate.
How often do I get a merchant statement?
Monthly, as a rule, either in an online portal or by post. Some providers charge for paper statements; review sites report Dojo's paper billing charge at £3.50 plus VAT a month. Pay-as-you-go providers show fees per transaction in the app rather than issuing a traditional statement.
What should I do if a fee on my statement looks wrong?
Check it against the fees schedule attached to your agreement first. If it is not in the schedule, or the amount differs, raise it with the provider in writing and keep the reply. Under PSR rules, exit and termination fees must be cost-based, transparent and fully explained before you sign, and under PSR Specific Direction 14, directed providers may not charge for a bespoke summary box of your fees.
The worked statement is illustrative. Provider fee amounts come from review sites and PSR directions were checked in August 2026; your own fees schedule and contract govern your account.
Sources (checked August 2026)
- PSR Specific Direction 15: trigger messages 31 days before end of minimum term
- PSR: summary boxes and online quotation tools (SD14)
- PSR Specific Direction 16: exit fees must be cost-based and transparent
- Interchange Fee Regulation: 0.2% debit cap
- Mobile Transaction Dojo review: refund and chargeback fees (review site)
- Merchant Machine: Dojo paper billing charge (review site)
- SumUp: 1.69% PAYG
- Square UK pricing: 1.75%
CapExpand Ltd (Company No. 14433858) is an authorised Dojo partner, not a card machine manufacturer. We are not currently authorised or regulated by the Financial Conduct Authority. Card machine pricing and availability are subject to change. All information on this page is for general guidance only.