Payment Processing 101 by Mitchell Fleming — Review

Merchant services contracts are among the most deliberately opaque documents SMB owners ever sign. Three-layer fee structures, tiered pricing that obscures actual cost, interchange pass-through dressed as "discount rates," hidden PCI non-compliance fees. Fleming's book is the clearest plain-English decoder I've found.

What The Book Covers

• Interchange fees (set by Visa/Mastercard, paid to card-issuing banks) — what they are, why they vary, what drives the rate
• Assessment fees (paid to Visa/Mastercard directly) — small but constant
• Merchant markup (what your processor adds) — the actual negotiable layer
• PCI compliance — what's real, what's a processor-invented fee
• Chargebacks and reserves — risk management basics
• Contract gotchas — cancellation fees, auto-renewal, equipment lease traps

Why This Matters For SMBs

Most SMB owners sign merchant contracts without understanding that interchange (the biggest single cost) is NOT the negotiable layer. They can save 0.2-0.5% by negotiating processor markup, but they can't change interchange. Knowing this flips the conversation: instead of "what's your rate?" you ask "what's your markup over interchange?"

Interchange-plus pricing (where the processor passes interchange through transparently and adds a fixed markup) saves most SMBs 0.3-0.8% vs tiered pricing. Fleming walks through how to evaluate both models and when each fits.

Practical Content

Chapter on reading a merchant statement. Most SMB owners never actually read their processor's monthly statement past the total. Fleming shows you how to find the hidden fees, the "non-qualified" surcharges, and the seasonal adjustments.

Equipment lease traps. The book is explicit about the classic $40/month-for-5-years equipment lease scam. Skip the lease, buy the terminal outright, save $2000+ over the contract term.

PCI compliance realities. Many processors charge $20-40/month "PCI non-compliance fee" for merchants who haven't self-attested. Completing the simple SAQ removes this fee. Fleming walks through how.

Who Should Read

Every SMB owner about to sign a merchant services contract. Every SMB owner who hasn't audited their merchant statement in the last 12 months.

Who Should Skip

Enterprise buyers with dedicated payments teams. Processors themselves (this is written for the merchant side of the conversation).

Verdict

The single most cost-saving book an SMB owner can read in the payment processing space. Pays itself back in the first contract you sign after reading it.