Quick Answer
Keyed virtual terminal sales cost more because the card is absent. Processors price that as fraud risk, and keying without full AVS and CVV data can push a sale into pricier interchange.
The fix sits in how each order is taken. Capture the billing address and security code on every keyed sale, and send a payment link whenever the buyer can enter the card themselves. I'll admit the trade-off: a link adds a step that some phone buyers won't take, and a slower sale is not always worth a cleaner one.
Passing the fee on is no lasting answer. Amanda Rose's September 2026 Substack points out that Australia's Reserve Bank acknowledges shoppers at surcharging businesses may end up paying similar amounts through the sticker price, which puts the cost back on the merchant's own pricing.
Key Points
- In 2024, Square's posted rates were 3.5% + 15 cents for a keyed card versus 2.6% + 10 cents for one tapped, dipped or swiped in person.
- A 2025 Federal Reserve Bank of Kansas City briefing cites the Pulse study's card-not-present debit fraud rate rising from 26.1 basis points in 2019 to 41.6 basis points in 2023 .
- Visa's U.S. interchange schedule dated April 18, 2026 prices exempt debit remote sales from 1.60% + $0.15 for e-Commerce Preferred Retail up to 1.90% + $0.25 at the standard rate.
A phone order keyed by staff is a card-not-present sale, and it is priced that way.
Most virtual terminal guides stop at the headline rate. I think the more useful question is what happens to the same order once your staff type the card in instead of the buyer. That question runs through every section below: how networks price a missing card, what a keyed sale costs at the interchange and flat-rate levels, and which data fields bring that cost down.
Passing the fee to buyers is the obvious escape. It is a shrinking one. The Reserve Bank of Australia estimates consumers there pay around $1.6 billion a year in card surcharges, and those surcharges are going away. CommBank is cutting its simple in-store merchant rate from 1.10% to 0.99%, yet businesses can no longer recover that fee separately. Amanda Rose, writing on Substack in September 2026, said the cost "hasn't disappeared. It's just moving." For a phone seller, it tends to move straight onto the margin of each keyed order.
In 2024, Square's posted rates were 2.6% + 10 cents for a card tapped, dipped or swiped in person and 3.5% + 15 cents for card details keyed in by hand. Same card. Same buyer. Different price. For high-risk sellers who take orders by phone or invoice, I'd argue that gap matters more than any headline virtual terminal fee, and most of it traces back to how the card data reaches the processor.
What makes a keyed virtual terminal sale different from an online checkout?
The difference is who types the card number and whether the card is there at all. Staff-keyed and customer-entered sales are both card-not-present, yet processors can price them apart.
Before comparing any rate quote, sort last month's card sales into three lanes:
- Card present: tapped, dipped or swiped at a terminal.
- Customer-entered online: the buyer types their own details into a checkout page or payment link.
- Staff-keyed: your team types the card into a virtual terminal from a call, mail order or invoice.
Strayer University's 2026 explainer defines card-not-present payments as "any payment made without the physical presence of the card," covering online purchases, phone orders and mail orders. Two of your three lanes sit inside that definition.
The common assumption is that virtual terminal pricing comes down to a per-transaction fee plus, at most, a monthly subscription. Capture method changes the per-transaction price itself. In 2024, one calculation of pure interchange put swiped sales at 1.51% + 22 cents and keyed or online sales at 1.89% + 22 cents. Keyed and online share that wholesale line. The extra cost of staff keying sits above it, in the processor's own keyed price and, potentially, in how much verification data arrives with the sale.
Finextra's report on PKO Bank Polski's IKO app shows the opposite extreme: app-generated codes replace card data at online checkouts, so no card number is typed at all. Less typed card data means less to steal.
Our underwriting team framed the logic plainly in September 2026, describing a very different vertical: the processor isn't pricing the product label. It prices the shape of the business and how each risk in it is controlled. A review of 5 sources points the same way, since price follows how the card data arrives. Our merchant payment processing solutions let established businesses accept credit card and ACH payments online or in person, which matters once your sales span more than one lane. The harder question is why the networks charge extra for the keyed lane at all.
Why do networks and underwriters price keyed card-not-present sales as riskier?
Because nobody can see the card or the cardholder. A keyed sale carries more fraud and dispute exposure, and underwriters price that exposure into every phone and invoice order.
A 2025 Federal Reserve Bank of Kansas City briefing states that card-not-present transactions "are inherently more prone to fraud than card-present transactions because the card and cardholder are not physically present for verification." Volume grew anyway. Federal Reserve Board data in that briefing show card-not-present debit value on Visa, Mastercard and Discover rising from $360 billion in 2011 to $1.8 trillion in 2021. Fraud rose too: the Pulse debit issuer study's average card-not-present fraud rate went from 26.1 basis points in 2019 to 41.6 basis points in 2023.
Processors pass that risk straight into price. In 2024, one flat-rate processor tied its cheaper in-person rate to a "lower risk of fraudulent activity when the cardholder is present." Phone orders add their own wrinkle. The Strayer explainer describes friendly fraud as a cardholder who "makes a purchase and then disputes the charge, claiming it was unauthorized." With a keyed sale, your record of consent is often just a call.
High-risk sellers pay for this twice. Their business model is already priced as risk, and the keyed channel stacks a second layer on top. When our underwriting team reviews an unusual model, such as card break platforms, the application has to describe each risk element and how it is controlled. A keyed phone channel is one more element to explain.
Sellers running serious phone and invoice volume should look at high-volume credit card processing services set up for that mix, because the controls an underwriter can credit start with the data your staff collect on every call.
How much more does a keyed phone order actually cost?
Two published price lists show how much more a card number read over the phone costs than a card in hand. A third, from Visa, shows where the cost can climb further.
The first figure comes from a small-business owner on Reddit's r/smallbusiness. In March 2024 he worked out pure interchange, the wholesale layer of a card fee, from one processor's data: "1.51% + 22c for in person/swiped and 1.89% + 22c for keyed/online." He treated those rates as a floor, calling them rates "you're not going to pay," and said not even Fortune 500 companies generally pay them.
The second comes from a July 2024 thread in r/asheville, where a commenter quoted a large flat-rate processor's public pricing: "2.6% + 10 cents per transaction" when a customer taps, dips or swipes in person, and "3.5% + 15 cents" for a keyed card. Side by side, the four rates follow the same pattern.
Keying the card raises the percentage by 0.38 of a point at the interchange level. Under the flat-rate list it raises the percentage by 0.9 of a point and adds 5 cents to the fixed fee. In these two examples, the premium more than doubles once a processor's own pricing sits on top of interchange.
The labels on those prices matter as much as the numbers. The benchmark folds "keyed/online" into a single rate. The processor's list puts manual entry and stored cards in the same sentence: "When you manually key in your customer's card details or use a card on file, the fee is 3.5% + 15 cents." Both sources draw the line at whether the card is present. In the benchmark, a card your staff types and a card your customer types cost the same. The processor even gave its reason for the lower in-person rate: "There is a lower risk of fraudulent activity when the cardholder is present."
The processor's reasoning matches the fraud data. Fumiko Hayashi, who wrote a 2025 research briefing on remote card fraud for the Federal Reserve Bank of Kansas City, describes card-not-present sales as "inherently more prone to fraud" because the card and cardholder are not there "for verification." She cites an annual debit issuer study whose average card-not-present fraud rate rose from 26.1 basis points in 2019 to 41.6 in 2023.
So does every remote sale carry the same price? Visa's U.S. interchange schedule, dated April 18, 2026, suggests the answer is no. For debit cards it lists as exempt, it prices remote sales under several separately named categories.
| Visa exempt debit category | Rate |
|---|---|
| e-Commerce Preferred Retail | 1.60% + $0.15 |
| Card Not Present | 1.65% + $0.15 |
| e-Commerce Basic | 1.65% + $0.15 |
| Electronic Interchange Reimbursement Fee (EIRF) | 1.75% + $0.20 |
| Standard Interchange Reimbursement Fee | 1.90% + $0.25 |
Two details stand out. A remote sale priced in Visa's card-not-present line pays exactly what a basic online checkout pays. The expensive outcomes sit at the bottom of the table: the standard rate of 1.90% + $0.25 sits well above the best e-commerce line at 1.60% + $0.15. The excerpt we reviewed names these categories without saying what a sale must carry to qualify for each, so the qualifying data is something to confirm with your processor. For debit cards Visa lists as regulated, every one of these lines carries the same 0.05% + $0.21.
A phone order costs more because the card is missing. Once a sale is remote, who keyed it mattered less in these sources than which price category it landed in. Remote risk can also come down. Hayashi points to Australia and France, which lowered card-not-present fraud with "strong customer authentication, tokenizing card account numbers, fraud risk modeling with machine learning, and real-time transaction monitoring."
Before your next statement review
- Ask for your fees split by entry method: in person, keyed, card on file and online, with the rate charged on each.
- Run your typical order size through your own in-person and keyed rates, so the gap shows up in dollars on your own sales.
- Ask which interchange categories your keyed debit sales land in, how many price at the standard or EIRF rate, and which data fields would move them to a better line.
- Before moving phone buyers to an online checkout, ask whether your pricing charges that lane any less. In the interchange benchmark we found, it did not.
How we checked this
We used a Federal Reserve Bank of Kansas City research briefing, Visa's published U.S. interchange schedule and two Reddit discussion threads. None of the figures here are our own company data. The interchange benchmark is one commenter's calculation from one processor's data. The flat-rate prices are a commenter's quote from 2024 and may have changed since. The Visa excerpt we reviewed covers debit cards only and does not list what qualifies a sale for each category. The fraud rates cover debit cards. We sell card processing to remote and high-risk sellers, so we have a stake in how these costs are explained. Still unknown: how credit card categories compare, and whether any given processor prices a staff-keyed sale differently from a hosted checkout.
- Fumiko Hayashi, Federal Reserve Bank of Kansas City, briefing on card-not-present fraud rates, May 21, 2025.
- Visa, Visa USA interchange reimbursement fees, dated April 18, 2026, retrieved October 15, 2026.
- r/smallbusiness, thread on card processing percentages, March 5, 2024.
- r/asheville, thread on tap, chip and swipe costs, July 18, 2024.
Which data fields and payment steps lower the cost of a keyed sale?
Capture every verification field on each keyed sale, shift buyers to entering their own card where possible, and confirm which fields your processor needs to price the sale well.
Use this list on every phone or invoice order, and treat each item as something to confirm with your processor:
- Full billing address and ZIP code for the address verification check, typed exactly as the cardholder gives it.
- The card security code (CVV), collected on the call and never stored after the sale.
- Cardholder name, email and phone, so the receipt reaches the buyer and any dispute has a record behind it.
- An order description or invoice number that matches what the buyer agreed to.
- A direct question for your processor: which of these fields does it need to give a keyed sale its best available rate, and what changes when one is missing?
I'd start with that last item. Your processor's answer sets your price, so get it in writing.
A 2024 r/smallbusiness thread made a sobering point: most of a card fee is the wholesale cost of the transaction, and the room to cut beyond it is "marginal, unless you fit some really niche circumstances." Clean data is one of the few levers a phone seller fully controls. Build it into the call script: read the billing address back to the buyer before you submit, so what your staff send matches what the card issuer holds.
Better still, take staff out of the card number entirely. Send a hosted payment link with each invoice so the buyer types their own details, the same logic behind code-based checkouts that keep card data off merchant sites. Fewer hands on the number means less to lose.
Before adding a card fee to keyed orders, find out whether each state you sell into allows one. US surcharging rules vary by state, county and city. In Australia, card surcharges effectively disappear from 1 October 2026, while merchants there still pay the underlying fee. Keyed sales that end in disputes also carry a longer tail, and sellers already flagged can explore TMF/MATCH list merchant account approval before that history decides their next processor for them.
Where does this leave phone and invoice sellers?
Keyed sales are likely to keep costing more while card-not-present stays the riskier lane. For phone-heavy sellers, how cards are captured becomes a standing cost line.
Passing the cost on looks tempting. It is a patchy fix. A September 2026 r/TwinCities thread recalled that Visa and Mastercard lost a court fight over surcharge bans in 2013, yet the practice still spread unevenly because state, county and city rules differ. Commenters there put card costs at 2-5% per transaction, depending on the card.
I'd also borrow a control from UC Santa Cruz's cash handling guide, which says no one person should be responsible for more than one of handling a payment, recording it and reconciling it. Start with one number from your own books, the share of monthly card volume your staff keyed by hand, since that share is how much of your margin this gap touches. Then bring your recent statements to your processor and ask which keyed sales were priced as the riskier kind.
Frequently Asked Questions
What else do sellers ask about virtual terminal costs?
Most questions come down to how the card reaches the processor. Keyed, stored and customer-entered sales are all card-not-present, but the data each one carries can differ.
What is a virtual terminal for credit card processing?
A virtual terminal is a secure web screen where your staff type a customer's card details to take a payment by phone, mail or invoice. No card reader is involved. Because the details are entered by hand, each of these sales is card-not-present, and it is priced differently from a tap at a counter.
What do AVS and CVV mean on a keyed sale?
AVS (Address Verification Service) compares the billing address a buyer gives with the one the card issuer holds. CVV is the security code printed on the card. Both give the issuer more to go on when nobody can see the card. Capture them every time.
Does charging a saved card on file cost the same as keying it?
It can. In 2024, a flat-rate fee schedule quoted in an r/asheville thread grouped card-on-file sales with manually keyed ones under the same higher rate. A stored card is still a card-not-present sale. Saving it does not move it into the cheaper lane.
Will a payment link always cost less than keying the card?
Not automatically. A sale the buyer enters through a link is still card-not-present; what changes is who types the data, so the address and security code come from the person holding the card. No published figure shows the effective-rate gap between the two on real statements. My advice is to split your own statements by entry method, because that is where the gap will show up.
Can SeamlessChex handle keyed phone orders and online payments together?
Yes. SeamlessChex provides credit card processing and merchant accounts that let businesses accept card payments, with ACH alongside, online or in person, and approvals cover subscription and high-risk businesses other processors turn away. Underwriting looks at how each part of a business is controlled, so describe your phone and invoice flow plainly when you apply through the SeamlessChex contact page.
Written by
Lily Flanigan
Operations Manager, SeamlessChex
Lily Flanigan is Operations Manager at SeamlessChex, a credit card processing and fintech payments platform recognized on the Inc. 5000, where she focuses on operations and process optimization.
Connect on LinkedInSeamlessChex works with established businesses processing a minimum of $25,000 per month.