A restaurant that wants to accept cards without a flat-rate processor can use a merchant account priced at interchange plus, also called pass-through pricing, where you pay what the card networks charge for each card plus a markup you can see in writing. In NPS’s study, a model finds lower costs on pass-through than on flat rate, and it finds the gap is largest for online and invoice payments. It may not save money for a brand-new restaurant with very little card volume, or for a counter that mostly sells items around $15 or less. This guide shows where the savings come from, what to ask a restaurant payments provider, and how to check your own statement before you switch.
The short answer
- Flat rate charges one percentage on every card. A cheap debit card and a rewards credit card cost you the same.
- Interchange plus charges each card at its own cost. You pay the real network cost for that card, then a disclosed markup on top.
- In NPS’s 2026 pricing study, a model of in-person sales shows savings of about 6.5% at a $15 ticket and 19% to 25% from a $40 ticket upward against Square’s 2.6% plus 15 cents, while its largest gaps are online and by invoice, so a restaurant should check its own numbers instead of trusting a headline.
- Flat rate can still win for very small tickets, around $15 and under in the study, and for a new restaurant with very low volume.
- Cheapest is a whole-bill question. Count monthly fees, equipment, tip handling, chargeback fees and support, not just the rate.
Pricing models
Flat rate vs. interchange plus at a glance
- How each card is priced
- Flat rateOne percentage on every card
- Interchange plusEach card at its own cost
- Can you see the markup?
- Flat rateThree costs bundled; you cannot see how they split
- Interchange plusOne markup the provider states up front
- Best fit
- Flat rateStartups, pop-up shops, under $10,000 a month
- Interchange plusOver $25,000 a month, multi-location merchants
- Debit card cost
- Flat rateSame percentage as rewards credit cards
- Interchange plusCapped at 0.05% plus 21 cents for large-bank debit
For most restaurants the real choice is flat rate versus interchange plus.
What “without a flat rate processor” really means
A flat-rate processor quotes one price for nearly every card sale. A common example is 2.6% plus 15 cents for an in-person sale, or 2.9% plus 30 cents online. That price covers three things at once: the interchange fee that goes to the bank that issued the customer’s card, the assessment fees the card brands charge, and the provider’s own profit. You cannot see how those pieces split.
Moving away from a flat rate means choosing a pricing model that pulls those pieces apart. Interchange plus (also written interchange-plus, cost-plus or pass-through) is one of the pricing models. You pay the actual interchange and card-brand fees for each sale, and then one markup that the provider states up front. NPS describes the same three parts in its guide to the four merchant account pricing models: interchange, assessments and processor markup.
Two other models exist. Tiered pricing sorts sales into “qualified” and “non-qualified” buckets, and sales often fall into the more expensive bucket. NPS’s own pricing guide says this makes it easy for providers to hide markups. Membership pricing swaps the percentage markup for a monthly fee and passes interchange through at cost. NPS describes that model as a fit for much larger volumes. For most restaurants the real choice is flat rate versus interchange plus.
Why a restaurant’s card mix matters
The reason pass-through pricing can cost less is the debit card. Under federal rules (the Durbin Amendment, put into effect as Regulation II), interchange on debit cards from large banks is capped at 0.05% of the sale plus 21 cents, with a 1 cent adjustment for fraud prevention. On a $40 check, the study says that works out to about 24 cents. A merchant on 2.9% plus 30 cents pays $1.46 on the same debit card.
Be careful with the word “most.” The cap applies to debit cards issued by large banks. Debit cards from smaller banks are exempt from the cap, and they cost more. In the study’s model, 35% of debit volume is assumed to come from those exempt issuers, which is one reason the model does not price every debit card at the capped amount. Also, the Federal Reserve has proposed lowering the cap, and the study notes that proposal is unresolved.
How much debit you take depends on your guests. The study says debit makes up roughly 30% to 40% of card payments on sales under $100 and about 20% to 25% over $100, and it uses a 35% debit share for a $40 ticket and 30% for a $75 ticket. Those ranges come from NPS merchant experience and are model inputs, not a survey. Younger guests use debit more often, and big-ticket and luxury purchases lean toward credit. A casual lunch spot and a steakhouse will not have the same mix, so look at your own report.
What the study says about in-person sales
NPS’s 2026 pricing study, “The Flat-Rate Tax,” is a cost model built on published rate schedules. It prices the same mix of debit and credit sales under flat-rate pricing and under pass-through pricing for three channels: invoices and payment links, online, and in person. You can read it here: NPS’s 2026 pricing study.
Two cautions about that study. It is a model, not a survey, and it was written by a processor that sells pass-through pricing, so it has a reason to find that pass-through wins. Second, its headline finding is about online and invoice sales: the study says businesses selling online or by invoice pay 19% to 31% less on pass-through than on flat rate across average tickets from $15 to $2,500. That range is not a promise for a dining room. Restaurants take cards in person, and the study treats in-person sales as its own channel with a flat-rate benchmark of 2.6% plus 15 cents, the Square Free in-person rate it quotes.
The study’s own list of model inputs shows why in-person gaps are smaller. Its blended credit interchange assumption is lower in person than for invoices, and in-person exempt debit is also assumed lower than online. So there is less room between a flat in-person rate and the real cost of the card. The takeaway for a restaurant is simple: savings may be real, but they should be tested on your own sales, and they will not look like the online headline.
When flat rate is still the cheaper choice
The study says plainly that flat rate is sometimes the better deal. In-person businesses with very small tickets, around $15 and under, save little by switching, because per-transaction fees take up a larger share of each sale. It also says flat rate is simple for brand-new businesses with very low volume.
NPS’s own pricing guide makes a similar point. It lists flat rate as best for startups, pop-up shops and merchants processing under $10,000 a month, and it lists interchange plus as best for businesses processing over $25,000 a month, B2B companies and multi-location merchants. The range in between is a judgment call.
Here is a plain test. If your restaurant is a coffee counter or snack window where most sales are a few dollars, a flat rate may be fine. If you have a sit-down room with checks in the $40 to $75 range and steady card volume, run the numbers. If you are three weeks from opening and have no sales history, a flat-rate starter account is a reasonable bridge, and you can revisit it once you have a few months of statements.
How to find out what you pay now
You do not need a sales call to see your own number. Your effective rate is your total processing fees divided by your total card sales for the same period. Take the last three months so one slow or busy week does not distort it. NPS describes this as looking at about 90 days of data from your payment dashboard or statements, including sales volume, number of transactions, average ticket, refunds, chargebacks, total fees and card-present versus card-not-present sales.
Then ask what is inside that number. Look for these lines on a statement or dashboard export:
- The percentage and the per-transaction fee on each card sale.
- Any extra percentage for keyed-in or card-on-file sales.
- Monthly, statement, gateway, PCI, batch or software fees.
- Chargeback or dispute fees, and whether they are returned if you win.
- Instant-payout or early-funding fees.
- Equipment, lease or software charges for your terminals and POS.
The study’s flat-rate figures leave out chargeback, instant payout and other add-on fees, so your real flat-rate bill may be higher than the model shows. NPS also offers a free statement review, and our guide to reading your merchant statement walks through the lines. For the other direction, how much you are really paying on Stripe, Square, PayPal or QuickBooks explains how NPS reads a flat-rate dashboard.
What to ask a provider that sells interchange plus
Interchange plus can be abused too. A markup can be hidden in monthly fees, and a low headline markup can sit beside high add-ons. Ask for the offer in writing and ask these questions.
- What is your markup, as a percentage and a per-transaction amount? Is it the same for debit and credit?
- What monthly, statement, gateway, PCI and batch fees apply?
- Is there a contract term, early cancellation fee, or equipment lease? What happens to my terminals if I leave?
- How do you handle tip adjustments, and do fees apply to the amount with the tip included?
- What do you charge per chargeback, and what help do I get fighting one?
- Will you run my last three months of sales through your pricing and show the math?
- Who answers the phone at 9 p.m. on a Saturday when a terminal is down?
Ask a provider
Questions to ask before you sign with a new processor
- Ask for the markup in writing, as a percentage and a per-transaction amount, for both debit and credit
- Ask what monthly, statement, gateway, PCI and batch fees apply
- Ask whether there is a contract term, early cancellation fee, or equipment lease
- Ask how tip adjustments are handled and whether fees apply to the amount with the tip included
- Ask what is charged per chargeback and what help you get fighting one
- Ask the provider to run your last three months of sales through its pricing and show the math
The last question is not decoration. A restaurant cannot close out a night when a terminal is down. Ask any provider to say in writing what support hours and response times it commits to.
The costs that sit outside the rate
The cheapest rate on paper can still produce the most expensive month. Three places to look:
Equipment and software. A restaurant POS (point of sale, the system that takes orders and payments) may be bought, leased or bundled. NPS describes restaurant POS with server-based ordering, kitchen integration, mobile orders, split checks and tipping controls. Ask whether the price you were quoted includes hardware, and whether the POS will work with a different processor if you leave.
Chargebacks. A chargeback happens when a guest disputes a card sale with the issuing bank. Restaurants can see them too. The study notes that Stripe charges $15 per dispute received, plus $15 to respond manually (refunded if you win), accessed October 2026. Whatever provider you pick, ask what a dispute costs and read the chargeback survival guide for bars, nightclubs and restaurants.
Adding a fee for card payers. Some restaurants use a cash discount, dual pricing or surcharge program to move card costs to the guest. NPS offers these programs, and has a guide to dual pricing. The rules for each differ and a mistake can create problems with the card networks, so set the program up with a provider that explains the rules for your situation.
A simple way to compare two quotes
Pick one real month of sales. Write down the total card sales, the number of transactions, and your average check. Then ask each provider for the total cost for that month, all fees included, in dollars.
With the total cost of both quotes in hand, divide each by your card sales to get an effective rate, and compare. A flat-rate quote is easy to calculate. An interchange-plus quote needs your card mix, and a good provider will ask for it. If a provider will not do the math on your own statement, treat that as information.
One more check: ask what happens if your card mix changes. A restaurant that adds a bar, a catering line or online ordering will see different interchange categories. Interchange plus follows those costs, which is good when they fall and bad when they rise, and a flat rate hides the change either way.
Compare two quotes
How to compare quotes on your own sales
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Pick one real monthWrite down the total card sales, the number of transactions, and your average check.
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Get total cost in dollarsAsk each provider for the total cost for that month, all fees included, in dollars.
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Calculate effective rateDivide each total cost by your card sales to get an effective rate, and compare.
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Check the card mixAn interchange-plus quote needs your card mix, and a good provider will ask for it.
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Ask what changes if your mix shiftsAsk what happens if your card mix changes, a restaurant that adds a bar, a catering line or online ordering will see different interchange categories.
For the full picture across every sales channel and average ticket, read our guide to cheapest payment processing in 2026.
Who wrote this, and where NPS fits
Nationwide Payment Systems (NPS) publishes this guide. We are a payments company based in Fort Lauderdale, Florida, in business since 2001, and we sell merchant accounts, so we are not neutral. We offer interchange-plus pricing, restaurant POS, a payment gateway, invoicing and ACH, and we also offer flat-rate and cash-discount programs. We do not publish one universal rate, because pricing depends on volume, ticket size, card mix, industry and risk. The study we cite was also written by NPS and compares flat rate with the kind of pricing we sell. Browse more in our payments guides, or read our plain comparison of flat rate versus cost-plus processing.
We are not the right fit for every restaurant. If your volume is very low, your tickets are tiny, or you want to be taking payments in an hour with no application, a flat-rate provider will probably suit you better today.
Bottom line
For a restaurant that wants to leave flat rate, interchange plus with a markup you can read, a short list of other fees, and a contract you can leave is the setup to compare. It is most likely to beat flat rate when you have steady card volume and checks well above $15. It is least likely to beat flat rate when volume is very low or tickets are tiny. In NPS’s study, the model finds a smaller gap in person than online, so test your own numbers. If you would like a second opinion on a quote or on your current statement, you can contact our team, and if another setup fits you better, we will say so.
Frequently asked questions
What is interchange plus pricing for a restaurant?
It is a pricing model where you pay the actual interchange fee and card-brand fees for each card sale, plus a markup the provider states in writing. Each card costs what it costs, instead of every card being charged the same percentage.
Is interchange plus always cheaper than flat rate?
No. In NPS’s 2026 pricing study, flat rate can be the better deal for in-person sales around $15 and under, and for brand-new businesses with very low volume. The study is a model, so check your own statement.
Why can debit cards cost less on pass-through pricing?
Federal rules cap interchange on debit cards from large banks at 0.05% plus 21 cents, with a 1 cent fraud adjustment. Flat rate charges the same percentage on those cards as on rewards credit cards. The cap does not apply to small-bank debit cards, which cost more.
How much could a restaurant save?
The study does not give a restaurant-specific figure. Its 19% to 31% headline is for online and invoice sales. For in-person sales its model shows about 6.5% at a $15 ticket and 19% to 25% from a $40 ticket upward, against Square’s 2.6% plus 15 cents. Any savings for a restaurant depend on your average check, debit share and fees, so ask for a quote based on your last three months.
What fees should I watch for besides the markup?
Look for monthly, statement, gateway, PCI and batch fees, chargeback fees, early-payout fees, extra percentages for keyed-in sales, and equipment or software charges.
Can I keep my POS if I leave a flat-rate processor?
It depends on the POS. Ask your current provider whether your hardware and software work with other processors, and ask the new provider which POS systems it supports before you sign.
Does NPS review a restaurant’s statement for free?
Yes, NPS offers a free statement review. Send a recent statement and ask for the math on your own sales.
