Industry Knowledge
Payment Processing in Canada
Agent Overview
🧠 Big Picture
Every time a customer taps, inserts, or pays online, multiple parties get paid.
Your job is to understand:
- 👉 who gets paid
- 👉 what they charge
- 👉 where costs can be hidden
🔄 The Payment Flow (Simple Version)
When a customer pays:
Customer taps card
Payment goes through processor
Bank approves / declines
Funds settle to the business
Behind the scenes, money is split between several players.
🏦 Who Gets Paid — The Key Players
1. Card Issuer (Customer's Bank)
RBC · TD Bank · Scotiabank
👉 They issue the card to the customer
👉 They take the largest portion of the fee
💰 What they earn: Interchange Fee
- • Usually 1.3% – 2.5%+ for credit cards
- • Debit (Interac) is much lower (flat fee)
👉 This is non-negotiable
👉 Same for everyone
2. Card Networks
Visa · Mastercard · American Express
👉 They run the payment rails
💰 What they earn: Assessment Fees
• Usually ~0.10% – 0.15%
👉 Also non-negotiable
3. Acquirer (Processing Bank)
Elavon · Moneris · Global Payments
👉 They move the money to the business
👉 They sponsor the merchant account
💰 What they earn
- • Part of the processing fee
- • Sometimes included in markup
4. Processor / ISO / Sales Agent
GekkoPay · Independent reps · Merchant service providers
👉 This is where pricing varies the most
💰 What they earn
- • Markup on top of interchange
- • Monthly fees
- • Terminal rentals
- • Hidden structure (in some cases)
👉 This is where your opportunity is
💸 What Gets Charged to the Business
Every merchant statement is made up of 3 main cost layers:
1. Interchange (Largest Cost)
Paid to: 👉 Customer's bank
Based on: card type, how payment is taken, business category
👉 This is fixed and unavoidable
2. Network Fees
Paid to: 👉 Visa / Mastercard
- • Small percentage (~0.1%)
- • Also unavoidable
3. Processor Markup (This is the key)
Paid to: 👉 Processor / provider
- • % markup
- • Per-transaction fees
- • Monthly fees
- • Equipment
- • Hidden fees (sometimes)
👉 This is where businesses can:
- • overpay
- • be misled
- • or be optimized
📊 Common Pricing Models
What agents must recognize:
1. Interchange+
MOST TRANSPARENTStructure: Interchange (real cost) + fixed markup
✅ Best for clarity · ✅ Easy to audit
2. Flat Rate
SIMPLE BUT PRICIER👉 Simple · 👉 Often more expensive at volume
3. Tiered / Blended Pricing
⚠️ WATCH THISWhat it looks like:
Reality:
- • Qualified rate (low)
- • Non-qualified = much higher
- • Downgrades added later
👉 This is where fees get hidden
⚠️ Where Businesses Get Overcharged
Your agents need to spot these:
1. Downgrade Fees
- • Extra charges based on rewards cards, business cards, keyed transactions
- • Often hidden
- • Can be 40–60% of total fees
2. Blended Pricing
- • Costs grouped together
- • No visibility into markup
- • Looks simple — hides margin
3. Padding Interchange
- • Processor adds % on top of interchange categories
- • Hard to detect
- • Requires analysis
4. Per-Transaction Fees
- • $0.05 – $0.15 per transaction
- • Small → adds up fast
5. Monthly Fees
- • PCI fees
- • Service fees
- • Platform fees
- • "Risk" fees
6. Equipment Rentals
- • $20–$60+ per terminal / month
🧠 What Lendshare Does
We do NOT change interchange
We do NOT control network fees
👉 We focus on the processor layer — where all the variability is.
🎯 Your Job as an Agent
You are NOT:
- a rate seller
- a terminal seller
- a "cheaper option"
You ARE:
👉 Someone who helps businesses understand where their money is going
🧩 The One-Line Summary
"Most businesses don't overpay on the cost of the card — they overpay on how that cost is packaged and marked up."
Final Takeaway
Every payment has:
Bank cost
interchange
Network cost
Processor markup
👉 Only ONE of those is flexible:
👉 The processor's piece. That's where you win.