How to Reconcile Online Payments & Fees Received from a Credit Card Processor

Cody Cromwell
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Why It’s Important to Reconcile Online Payments & Fees

Sometimes, a customer will dispute an online transaction or return an item they chose to purchase online.

Sometimes a customer will return an item because they perceive the purchase fees were too expensive, or they have a bad experience in your shop, and you need to address this immediately.

When a credit card transaction is disputed, it’s important to keep all of your records and try to find additional information like Sales Orders, the Transaction ID, or Merchant IDs. If you don’t have these, you’re going to have trouble responding to the transaction dispute.

But even in cases where you do have all the information, you’ll probably notice you’re missing the credit card billing statement that the credit card processor sent you when the transaction was first processed.

This statement provides all the info you need, and it will proof that your pricing was fair and that you were in compliance with their policies.

To help you reconcile all of the transactions and fees that you received, I’ve compiled a list of common credit card transaction fees that are addressed in the statement you get from the credit card processor and a short explanation of when and why you need to make a change to your online pricing during the transaction process:

How To Reconcile Online Payments & Fees

Online payments are a very good way of paying for your items on an online smaye. But one common barrier to online payment is that most sellers do not include the fees received from the credit card processor. This can be really confusing for you as many sellers do not provide instructions about how to find out the total amount you have paid.

And most sellers provide the final total amount received after credit card fees and any other charges. But when you are looking for a bank statement to check the fees onto, one of the first steps you have to do is remember the amount for each transaction so that you can do the calculation.

This problem can be solved easily by taking a note of the total amount and enter it in to your bank statement to find the amount of fees. However, a software tool made by a site called will make it easy for you to calculate and find out the fees for your credit card transactions. It’s a very simple tool that takes a note of any amount you want and then calculates the fees for you. You just have to enter the amount in the tool, click the calculate button and it will display the fees for you.

Step 1 – From the Xero Dashboard, scroll down to your PayPal bank account as indicated in the screenshot below.

Click on your account name.

Step 2 – Click on the blue button that says “Reconcile 4 items” as indicated in the screenshot below.

Step 3 – Choose the number of transactions you’d like to reconcile. You can select up to 4 transactions.

Step 4 – The next screen is a summary of your previous activities. Simply click on the top right “Reconcile” icon.

Step 5 – The screen that opens up is an all new one. First make sure your “Total Transaction Amount” is highlighted. Click on the arrow icon (pencil icon) to choose between Reconcile Transactions or Clear Financial Transactions. Your overall total should be highlighted now.

Step 6 – To reconcile a credit card, all you need to do is click the “Reconcile” button.

Step 7 – You will be redirected to a page that gives you an opportunity to review the transactions you selected.

Step 3 – The following screen will show the details of all unreconciled transactions; a brief explanation is provided below.

Your credit card processor will charge a service fee (3.5% on your sales) for each transaction not reconciled. If you have not received any funds from your customers for a period of time, it is likely that a chargeback has been filed against your store. The chargeback usually results in a loss of sale within 24 hours.

If you’re not sure if a chargeback has been filed against you, first check with your credit card company to see if the chargeback has been denied. If it has been, download the chargeback report. Your credit card company will send you this report within seven days of the chargeback being filed.

If you decide that a chargeback should not have been filed, you’ll need to dispute it with your credit card company. After disputing a chargeback, it can take up to 30 days to clear. When the dispute is resolved, you should see a reversal in your merchant return activity and sales.

In step 3, you will see an unreconciled transaction, which is a transaction that goes back as a loss because it was never posted. The transaction is marked as unpaid, which the customer can dispute with their bank.

Step 4 – Confirm “Matched” Transactions.

This part is crucial. Make sure any deposits you’ve received from your customers have been deposited into your bank account. Once you’ve obtained matching deposits, make sure to clear the deposits out of your account before the fees hit your bank account or you’ll be charged with another bounced check fees.

After you’ve confirmed a matched deposit, go back to the payment processor, call them, and explain your situation. If the payment processor declines to reverse charges, you have to wait it out. Once your money is returned to your business account, you’re cleared to close the Visa Statement Program dispute.

Step 5 – Reconcile “Unmatched” Transactions.

To ensure your reconcilement is as accurate as possible, you’ll need to download all transactions (as a spreadsheet) with the following currency codes:


Then select the categories list at the top to find the settlement date that represents the period when those transactions were created.

Once you do that, you’ll be able to click on each transaction to see the corresponding transaction number. In order to reconcile your bank statement, you’ll need to make sure the transaction number shifts from the spending account to the deposits account. This is usually the last item on your reconcilement screen.

This is also where it’s important to have an accurate cash register. Even though you’re reconciling correctly, if your automated cash register inputted the transaction number incorrectly, you could end up with a huge sum in your bank account that’s no longer actually in your business. If you’re reconciling manually, make sure the transaction number details correspond with your bank statement.

Step 6 – Reconciliation Complete.

Wrap Up

These days it is becoming more and more common that we do online transactions. We transfer money to friends, family, and other online users. We shop online and pay with credit cards, debit cards, or with our paypal account. And to the small business owners it is becoming more and more important to understand and calculate the fees of the payment processor to their advantage.

The payment processor fees take a certain percent of the funds cleared from the customer and this percent fee is based on payment type. The fees vary based on the payment type but it is directly proportional to the amount of funds in a transaction and this is why it is important to know how he fees works.

What to do when you start your business and you need to know the processor fee for Visa, Mastercard, American Express and paypal?

There is a website that calculates the fee's on the payment processor and it will do it for you based on the type of card you enter. A few information about the fee's for payment processing will be helpful.

Some of the fees that may apply are as follows:

Deducted interchange fee's, add'l non-share debit fee's, add'l non-share credit fee's and fee's for cards without logo:

What are these fees ?

Here are the fee's that may apply: