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A comprehensive guide to cross border fees for merchants

Whether you sell to an international clientele online or you sell your wares in a touristy area to which many tourists flock, as a merchant, it’s important to be aware of some fees that will (and we emphasise will and not may) arise because of transactions accepted with foreign cards.

In particular, we’re referring to cross-border fees. But what are they and why are they charged? Find out more by reading below. 

What is a cross-border fee?

A cross-border fee applies to transactions where the customer’s card is from a foreign bank, different from the country in which the merchant operates. This is especially the case with merchants who service tourists in person or those who sell online. They are also commonly called assessment fees, an International Service Assessment (Visa), a foreign transaction fee.

What makes them difficult to navigate is that they are a non-negotiable base figure and they’re implemented by card networks such as Visa, Mastercard, and other main global players. 

So, what factors come into play when determining whether a cross-border fee applies?

The first is the location of the registered business. When first registering for payment processing services, a business needs to show in which country their business is registered. If sales are made within that country, they will be considered domestic. 

On the other hand, if they make the sales outside this country of registration, the result will be cross-border fees being charged. The second variable relates to the location of the card-issuing institution. 

Is this the same as a currency conversion fee?

The quick answer is no. The latter fees are separate and can be charged together with cross-border fees. In addition, the value of the currencies is related to the exchange rates. However, these fees are implemented for the act of transacting itself. 

When a tourist hands you their foreign-issued card and wants to make a purchase in your country, or you’re making a sale online to an international customer, you’re going to be charged a cross-border fee.

How much are cross-border fees?

Card networks started the cross-border fee in 2005. They vary depending on the card issuer and the currency in which they settled the transaction. 

The typical range for cross-border fees is between 0.4% and 1.2%.

Can you avoid them?

Although the general discussion around avoiding cross-border fees is that they cannot be circumvented simply because they are non-negotiable, there are some steps you might take to avoid such fees. 

The first step is to use an acquiring bank that supports business accounts with multi-currency processing. Second, consider directing your customers to purchase your wares from local distributors. The third option is to register a branch of your company in the country where you’re expecting to do large volumes of business. 

However, you should only do this if your business is expanding, you’re expecting a higher sales volume from a particular country, if you can actually afford it and if the benefits outweigh the cons.  


Although unavoidable when it comes to payments acceptance with foreign-issued cards, cross-border fees, which were introduced in 2005, are an important factor to consider when deciding to trade abroad online or accept in-person payments from cards that have been issued in another country.

These costs can add up and it’s worthwhile looking into whether your business can weather them or whether it’s something you wish to avoid altogether.

In this article, we covered what a cross-border fee is, explained the differences between this fee and currency conversion fees, and mentioned whether cross-border fees can be circumvented or not, which we hope will help with your decision-making process and ensure that you run your business smoothly.

Disclaimer: Please be aware that the contents of this article and the myPOS Blog, in general, should not be interpreted as legal, monetary, tax, or any other kind of professional advice. You should always seek to consult with a professional before taking action, since the particulars of your situation may materially differ from other cases.

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