Processor fees
Processor fees are what a payment processor or merchant of record keeps from each payment before paying you. Ignoring them overstates revenue by several percent, and on low-price plans or international cards the gap is large enough to change which channel looks profitable.
Formula
net revenue = amount − fee (charges); −(amount + fee) for refunds and chargebacksSubtract the fee from every charge. For refunds and chargebacks, subtract both the refunded amount and any fee charged on it, since most processors do not return the original fee.
Worked example
| Charge | $49.00 |
|---|---|
| Fee | $1.72 |
| Later refund | $49.00 with a $0 fee |
- Charge net: $49.00 − $1.72 = $47.28
- Refund net: −($49.00 + $0) = −$49.00
- Total: $47.28 − $49.00 = −$1.72
The refunded sale cost you $1.72 net, the fee that was not returned.
How ProductLense shows it
ProductLense records the fee on every payment where the provider exposes it: Stripe balance transaction fees, Razorpay fees including GST, Gumroad fees, Polar platform fees, and the merchant-of-record cut for Paddle and Dodo. Revenue, profit, ROAS and payback all use net revenue after fees.
A billing connection is enough. Where a provider does not expose fees, such as Lemon Squeezy, Chargebee, Shopify orders and Creem, the fee is recorded as 0 and the integration page says so.
Processor fees: questions
- What is processor fees?
- Processor fees are what a payment processor or merchant of record keeps from each payment before paying you. Ignoring them overstates revenue by several percent, and on low-price plans or international cards the gap is large enough to change which channel looks profitable.
- How do you calculate processor fees?
- Subtract the fee from every charge. For refunds and chargebacks, subtract both the refunded amount and any fee charged on it, since most processors do not return the original fee. For example, a $49 charge with a $1.72 fee that is later refunded leaves −$1.72 of net revenue.
- Where does ProductLense show processor fees?
- ProductLense records the fee on every payment where the provider exposes it: Stripe balance transaction fees, Razorpay fees including GST, Gumroad fees, Polar platform fees, and the merchant-of-record cut for Paddle and Dodo. Revenue, profit, ROAS and payback all use net revenue after fees.
- What does ProductLense need to calculate processor fees?
- A billing connection is enough. Where a provider does not expose fees, such as Lemon Squeezy, Chargebee, Shopify orders and Creem, the fee is recorded as 0 and the integration page says so.
- How is processor fees different from refund rate?
- Fees are a cost on every payment; refunds are reversed payments. Both reduce net revenue, and ProductLense subtracts both, but they need different fixes: fees by choosing providers and pricing, refunds by product and onboarding.
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