What is a Payment Processing Fee?
A payment processing fee is the charge you must pay on some transactions to move money from one account into another, so you can purchase a product or service. Most merchants process payments through a third party service at the point of sale and automatically assess the charge onto customers at the point of sale. However, you might incur processing fees for cash and check payments, as well.
How Do Payment Processing Fees Work?
Many pet insurance providers charge policyholders a payment processing on top of their monthly premium. Each provider establishes their own rate (usually expressed as a percentage of the total cost) and chooses which transactions the processing fee applies to. While the rates are usually nominal, they can add up quickly - especially when you look back at them on a yearly basis over the duration of your policy. You may be able to avoid the recurring fee and reduce the lifetime cost of pet insurance by buying an annual plan upfront versus monthly installments. When comparing pet insurance, remember to always read the fine print carefully so you can avoid unexpected surprises later on.
Key Takeaways
- Payment processing fees are fees charged per transaction that cover the cost of your credit card being processed for the payment of a good or service.
- Payment processing fees vary depending on your pet insurance provider.
- Take a look at any payment processing fees before choosing a pet insurance plan, as these fees can quickly add up over time.
