Final answer:
The typical fee for credit card processing ranges from 1.5% to 3.5%. These fees are charged to merchants for each transaction processed by credit card companies, which is separate from the interest and penalty fees charged to cardholders.
Step-by-step explanation:
The typical fee that credit card companies charge for processing transactions falls between 1.5% and 3.5%. This fee compensates the credit card processor for their role in facilitating credit card transactions, which includes verifying the transaction, ensuring the funds are available, and transferring the money to the merchant. Note that the rates can vary based on various factors such as the merchant's business type, the type of card used (credit, debit, rewards, corporate), and the arrangement with the credit card processor.
While credit card interest charges can range between 12% to 18% annually, this interest is applied to the balance carried by credit card holders, which differs from the processing fees paid by merchants. Credit card issuers also charge additional fees such as late payment fees or other penalties as cited in the reference with $10 for late payments and $5 daily charges for each day the payment remains unpaid. The two are separate types of fees, with processing fees being a portion of each transaction and interest rates/penalties being charged to cardholders under certain circumstances.