Transaction costs

Transaction costs are the charges applied for a transaction. This may, for example, be the transfer of property rights to goods and services in exchange relationships between at least two contractors. In general, a distinction is made between ex ante costs (before the conclusion of the contract) and ex post costs (after the conclusion of the contract).

PSPs and transaction costs

Payment service provider might charge a transaction fee per booking processed. These costs ensue for the payment clearing between the customer's bank and the merchant's bank. In most cases, the payment clearing process involves other companies, such as acquirers, who are paid by the PSP through the transaction fees.

The transaction costs are calculated as a percentage. The higher the transaction volume, the lower the average cost. In addition, the fees vary depending on the payment method. Additionally, others factors such as the country, the industry, and the average price of the traded goods can play a role. The payment service provider retains the amount already during the settlement of the transaction.