A subscription or membership business charges the same cards over and over, say $15 to $300 a charge. That changes which fees matter. Card-on-file charges can be priced higher than a customer paying at your counter: as read on Square’s fees page on November 13, 2026, card on file or manual entry is 3.5% plus 15 cents, and as read on Stripe’s pricing page that day, a successful domestic card transaction is 2.9% plus 30 cents. This guide works through a made-up month of 400 members paying $40, then covers failed payments, refunds, disputes, ACH, and what our study says about how much a pass-through model could change the bill.
Processor comparison
Stripe vs. Square for card-on-file charges
- Rate per charge
- Stripe2.9% plus 30 cents
- Square (card on file)3.5% plus 15 cents
- Cost per $40 charge
- Stripe$1.46
- Square (card on file)$1.55
- 400 charges a month
- Stripe$584 a month
- Square (card on file)$620 a month
- Annual fees (400 × $40)
- Stripe$7,008 a year
- Square (card on file)$7,440 a year
The two come out $36 a month apart on this example.
The short answer
- Recurring charges are card-on-file charges, and some processors price them higher. As read on Square’s fees page on November 13, 2026, card on file or manual entry is 3.5% plus 15 cents, against 2.6% plus 15 cents for tap, dip or swipe. Stripe’s pricing page, read the same day, lists 2.9% plus 30 cents.
- Our arithmetic: 400 members at $40 a month is $16,000 a month. At Stripe’s listed price the fees are $584 a month, or $7,008 a year. At Square’s card-on-file price they are $620 a month, or $7,440 a year.
- Our study is a model. NPS’s 2026 pricing study finds interchange pass-through costs 19% to 31% less than flat rate for online and invoice sales across average tickets from $15 to $2,500. It was written by a company that sells pass-through pricing, so use it as a reason to get a quote, not as proof of your savings.
- Very small tickets save little in dollars. A percentage off a small charge is a small number. Do the math at your own price.
- Check each processor’s own page. Prices change, and your own account may have different terms.
400 members, $40
What 400 members at $40 costs in fees
- Stripe$584/moStripe listed price2.9% plus 30 cents per charge; $7,008 a year
- Square card on file$620/moSquare card-on-file price3.5% plus 15 cents per charge; $7,440 a year
Why a membership business is priced differently
A shop that swipes a card at the counter and a gym that charges a card saved on file are not the same kind of payment to a processor. The customer is not present, the card number was saved earlier, and the charge runs on a schedule. Some processors list a separate, higher price for that.
The two flat-rate processors we checked show it. As read on Square’s fees page (squareup.com/help/us/en/article/5068-square-fees-overview) on November 13, 2026. Tap, dip or swipe is 2.6% plus 15 cents. Online sales or invoices are 3.3% plus 30 cents. Online API payments are 2.9% plus 30 cents. Manual entry or card on file is 3.5% plus 15 cents. As read on Stripe’s pricing page the same day, a successful domestic card transaction is 2.9% plus 30 cents, with an extra 0.5% for manually entered cards.
Square fee types
Square prices vary by how the card is used
| Payment type | Rate | Per-charge fee |
|---|---|---|
| Tap, dip or swipe | 2.6% | plus 15 cents |
| Online sales or invoices | 3.3% | plus 30 cents |
| Online API payments | 2.9% | plus 30 cents |
| Manual entry or card on file | 3.5% | plus 15 cents |
Two plain how-to points follow. First, find out which line on the price list your recurring charges fall under. Do not assume it is the cheapest one. Second, ask the processor to say so in writing, for your kind of business. If the answer is “it depends,” ask on what.
A made-up month: 400 members at $40
This is made-up math to show the method, not a promise about your account. We used the prices as read on November 13, 2026 and checked each result with a calculator script.
- Sales: 400 members at $40 is $16,000 a month, or $192,000 a year.
- At Stripe’s listed 2.9% plus 30 cents: each $40 charge costs $1.46 (that is $1.16 plus 30 cents), which is 3.65% of the charge. For 400 charges, $584 a month, or $7,008 a year.
- At Square’s listed 3.5% plus 15 cents for card on file: each charge costs $1.55 ($1.40 plus 15 cents), which is 3.88%. For 400 charges, $620 a month, or $7,440 a year.
The two come out $36 a month apart on this example. That gap is small next to the real question, which is what the whole bill is made of. At a $40 charge the fixed cents do real work: 30 cents on $40 is three-quarters of a percent by itself.
Now the study’s range, applied to our made-up bill. If the model’s 19% to 31% lower cost for online and invoice sales held for a business like this one, 19% of $584 is about $111 a month and 31% is about $181 a month, or roughly $1,332 to $2,172 a year. That is our arithmetic using the study’s range on a made-up number. It is not a quote, not a promise, and it ignores the fees any pass-through provider would add. Your result depends on your own card mix and fees.
The $15 charge: where savings get small
The same arithmetic at a $15 membership shows why very small tickets save little. At Stripe’s listed price, a $15 charge costs $0.735, which is 4.9% of the charge (our arithmetic). For 400 members that is $294 a month. Take the study’s 19% to 31% range off that and you get about $0.14 to $0.23 saved per payment, or roughly $56 to $91 a month across the 400 members, in the model.
Our study also says flat rate can still be the better choice for very small tickets (around $15 and under in person) and for brand-new, very low-volume businesses. So if your membership is $15 and you have 40 members, a flat-rate processor may simply be the right tool, and the time you save may be worth more than a few dollars. Pass-through starts to deserve a look as your price per charge or your member count goes up.
Failed payments: treat them as a process
With a recurring charge, a card will sometimes fail. You do not need statistics to plan for it. You need a routine, written down, so each case is handled the same way.
- Tell the member the same day. A short, plain email with a link to update the card does most of the work.
- Retry on a schedule you choose. Decide how many retries you will run and how many days apart, and keep it consistent.
- Decide in advance what pauses. Say when access stops and when it comes back, and put it in your terms.
- Ask about fees on failed attempts. Ask your processor in writing whether a declined or failed attempt costs anything, and whether each retry is billed.
- Write down what you recover. Over a few months you will see your own pattern, which is more useful than anyone’s average.
Refunds and disputes, as plain how-to
A refund returns money to a member. A dispute, also called a chargeback, happens when a member asks their card issuer to reverse a charge. For a membership business the two connect: a member who cannot cancel easily, or does not recognize the charge on a statement, may go to the bank instead of to you.
- Make the charge recognizable. Use a billing name members will recognize, and send a receipt for each charge.
- Make cancelling easy. A clear cancel link in the member’s account costs you one membership. A dispute costs you the charge and a fee.
- Refund a fair complaint quickly. Compare the cost of a refund with the cost of a dispute in your own account.
- Keep your records. Save the sign-up date, the terms the member agreed to and each receipt, so you can answer a dispute if one arrives.
- Know the dispute fee. As read on Stripe’s pricing page on November 13, 2026, it lists $15.00 for each dispute received, $15.00 for each dispute you respond to manually (refunded for won disputes) and $15.00 for each dispute appealed (not refunded). Check any processor’s page for its own dispute fee, and ask whether fees are treated differently on a refund.
Our arithmetic on a made-up case: three disputes in a year, each responded to manually and lost, is $90 in Stripe’s dispute fees on top of the lost charges. The fee is small. The lost sales and the time are not.
Where ACH fits, and where we will not guess
ACH is a bank-to-bank payment. Some membership businesses offer it as a second option so members can choose a bank account instead of a card. NPS offers ACH, and we cover it in our ACH optimization guide.
We publish no ACH rate figures here, and we will not guess at one. If you are weighing it, ask any provider for the price per payment in writing, including any fee when a bank payment fails, and compare it with your card cost per charge from the example above. At a $40 charge, a fixed fee and a percentage fee behave very differently, so run both at your price.
Why a flat rate can cost more on some cards
A card payment has several parts. The biggest is interchange, a fee set by the card networks that goes to the bank that issued the customer’s card. Then come network assessments, and then the processor’s own markup. A flat-rate processor bundles all of it into one price, so you cannot see which part is which.
Interchange-plus, also called pass-through, separates them. You pay the real interchange and network fees for each card plus one markup written in your agreement. NPS explains where the money goes in where Stripe fees actually go.
Debit is part of the reason. Under federal rules, interchange on debit cards from large banks is capped at 0.05% of the sale plus 21 cents, with a 1 cent fraud adjustment. The cap does not apply to debit cards from small banks, so check your own mix. NPS covers that in whether the debit cap applies to small-bank cards. Business and commercial cards can cost more. Level 2 and Level 3 data can lower some of those costs. Interchange varies by card type, which is why only your own statement settles the question.
How to work out your own recurring cost in ten minutes
- Count your charges. Take one month: the number of successful charges and the total dollars collected.
- Add up every fee. Include the percentage fees, per-charge cents, monthly fees, dispute fees and any fee for failed attempts.
- Divide fees by dollars collected. That is your effective rate. Compare it with the 3.65% our arithmetic shows at Stripe’s listed price for a $40 charge.
- Multiply by twelve. The yearly number is the one that changes decisions.
- Get one written quote and compare line by line. Ask for the markup, monthly fee, gateway fee, statement fee, card-on-file or recurring pricing and the contract terms.
Ten-minute exercise
Work out your own recurring cost
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Count your chargesTake one month: the number of successful charges and the total dollars collected.
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Add up every feeInclude the percentage fees, per-charge cents, monthly fees, dispute fees and any fee for failed attempts.
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Divide fees by dollars collectedThat is your effective rate.
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Multiply by twelveThe yearly number is the one that changes decisions.
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Get one written quote and compare line by lineAsk for the markup, monthly fee, gateway fee, statement fee, card-on-file or recurring pricing and the contract terms.
Our guide on how to read your merchant statement walks through the lines, and how much you are really paying on Stripe, Square, PayPal or QuickBooks covers the same exercise across providers. For a business that bills by invoice rather than by schedule, see cheapest card processing for invoices and payment links.
When staying on a flat rate is the right call
- You have few members. The yearly difference may be a few hundred dollars, and switching takes time.
- Your price per charge is very small, around $15 or less.
- You are brand new with very low volume, where our study itself says flat rate can win.
- Your billing tool is built into the processor and you rely on its reminders, retries and member pages.
For the wider cost question, see cheapest payment processing in 2026.
Questions to ask any processor before you move
- What is the price for card-on-file or recurring charges, in writing?
- What is the markup over interchange, and is it fixed?
- Is there any fee for a failed or declined attempt, or for a retry?
- What are the dispute fees, and are they refunded if I win?
- How are fees treated when I refund a member?
- Are there monthly, gateway, statement or PCI fees?
- Can I see a sample statement with each fee on its own line?
Before you switch
Questions to ask any processor in writing
- Ask the price for card-on-file or recurring charges, in writing
- Ask the markup over interchange, and whether it is fixed
- Ask whether a failed or declined attempt carries any fee, or a retry
- Ask what the dispute fees are, and whether they are refunded if you win
- Ask how fees are treated when you refund a member
- Ask about monthly, gateway, statement or PCI fees
- Ask for a sample statement with each fee on its own line
You can also run your own recurring numbers through our savings calculator.
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 and invoicing software, so we are not neutral. We offer interchange-plus pricing, ACH, a payment gateway and Smart Invoicing, and we also offer flat-rate options. We do not publish a price list. The study we cite was written by our CEO. NPS offers a free statement review. Browse more in our payments guides.
We are not the right fit for every business. If you have a small membership at the lowest prices, or your current tool handles billing well, a simpler setup may cost you less.
Bottom line
For a subscription or membership business, the cheapest card processing is the one whose price you have checked at your own charge size and your own member count. In our made-up month, 400 members at $40 cost $584 at Stripe’s listed price and $620 at Square’s card-on-file price, as read on November 13, 2026. A pass-through model could lower that, in our study’s model, but small tickets save little in dollars. Pull your own numbers, check each processor’s current page, and compare one written quote line by line. If you would like a second opinion, you can contact our team.
Frequently asked questions
What does it cost to charge a card on file every month?
It depends on the processor. As read on Square’s fees page on November 13, 2026, card on file or manual entry is 3.5% plus 15 cents. As read on Stripe’s pricing page that day, a successful domestic card transaction is 2.9% plus 30 cents. Check each page for today’s price.
What would 400 members at $40 a month cost in fees?
Our arithmetic, made-up math to show the method: at Stripe’s listed 2.9% plus 30 cents, each $40 charge costs $1.46, so 400 charges cost $584 a month, or $7,008 a year. At Square’s listed 3.5% plus 15 cents for card on file, each charge costs $1.55, so 400 cost $620 a month, or $7,440 a year.
What happens to a member whose card fails?
Treat it as a process, not a surprise. Email the member the same day, give them an easy way to update the card, retry on a schedule you choose, and decide in advance when access pauses. Ask your processor in writing whether a failed attempt carries any fee.
How do refunds and disputes work for a membership?
Refund quickly and clearly when a member has a fair complaint, and compare the cost of a refund with the cost of a dispute in your own account. As read on Stripe’s pricing page on November 13, 2026, a dispute carries $15.00 for each dispute received, plus $15.00 if you respond manually (refunded for won disputes). Ask any processor how fees are treated on refunds.
Can ACH lower the cost of recurring charges?
It can be worth pricing. ACH is a bank-to-bank payment, and NPS offers it. We publish no ACH rate figures, so ask any provider for a written price per payment and compare it with your card cost per charge.
How much could interchange pass-through save a subscription business?
In our study’s model, pass-through costs 19% to 31% less than flat rate for online and invoice sales across average tickets from $15 to $2,500. It is a model from a company that sells pass-through pricing, not a survey and not a promise. Test it against your own statement.
Does NPS review my current statement for free?
Yes. NPS offers a free statement review.
