What a card payment actually costs you

Card fees are quoted in a format that hides where the money goes. "2.5% plus 35p" and "1.19% plus 20p" look like the second one is roughly half the first. On a small ticket they are much closer than that, and on a very small ticket the percentage barely matters at all.

The arithmetic

Every card fee has two parts. A percentage of the transaction, and a fixed amount per transaction regardless of size. The fixed part is the one that decides whether small jobs are worth taking on card.

On a £12 fringe trim at 2.5% plus 35p, the percentage is 30p and the fixed fee is 35p. Total 65p, which is 5.4% of the sale. The headline rate said 2.5%.

On a £40 cut at the same rate, the percentage is £1 and the fixed fee is 35p. Total £1.35, or 3.4%.

On a £480 clutch replacement, the percentage is £12 and the fixed fee is 35p. Total £12.35, or 2.6%. Now the headline rate is nearly the real rate.

What this means in practice

The smaller your average transaction, the more the fixed fee matters and the less the percentage tells you. A barber doing forty £15 cuts a week is in a completely different position to a garage doing eight £400 jobs, even on identical rates.

Three things worth doing about it

• Work out your real blended rate. Take last month's total card fees and divide by total card takings. That single number is more useful than any headline rate.
• Look at whether very small transactions belong on card at all, or whether they should be bundled. A £6 add-on charged separately costs proportionally far more than the same £6 added to the main bill.
• Check whether the platform fee is inside or outside the card rate. A low card rate with a separate per-booking or new-client fee is not cheaper, it is differently shaped.

Youzse charges 2.5% plus 35p, and the platform fee is inside that. There is no separate per-booking fee and no commission on new clients who find you through Youzse. Whether that is cheaper than an alternative depends entirely on your mix, which is why the blended-rate calculation above is worth ten minutes of your time before you choose anything.