Square, Flat-Rate Pricing, and What Car Wash Owners Should Know About Payment Processing Costs
Understanding how payment processing works can protect your profitability as card usage continues to rise.
For car wash owners, the right POS system and payment processor can have a meaningful impact on the bottom line. Car washes process thousands of small transactions every month, and even small differences in processing fees compound quickly.
Many operators are tied into subpar processors that charge flat rates or tiered pricing structures that are not designed for car wash economics and do a poor job of managing subscriptions. These pricing models can quietly nickel and dime a car wash owner, taking margin out of every wash without making it obvious where the money is going.
Understanding how payment processing really works, and how different pricing models affect your fees, is essential if you want to protect profitability as card usage continues to rise.
Car Washes Are Taking Less Cash Than Ever
Across the industry, cash usage continues to decline. Card payments, mobile wallets, and stored payment methods now dominate most car wash transactions. We already see some operators running card-only lanes or fully cashless sites to improve speed, reduce maintenance, and eliminate cash handling issues.
Why Payment Processing Matters for Car Wash Owners
Many popular processors, including Square and other non-car-wash-specific platforms, use flat-rate or tiered pricing. These models charge the same percentage and per-transaction fee regardless of the type of card being used.
That approach is simple, but simplicity comes at a cost.
Car washes see a high volume of debit card transactions alongside consumer credit, rewards cards, and business cards. Debit cards in particular are often significantly cheaper at the card-network level than rewards or commercial credit cards. Flat-rate pricing ignores those differences and averages everything together.
The result is that lower-cost cards do not actually lower your fees.
Why Flat-Rate Pricing Falls Short for Car Washes
Car wash owners do not control what cards their customers use. You cannot choose whether a customer pays with debit, credit, or a business card. And just to clarify, rewards cards of all types cost you, the car wash owner, the most because you are paying for the rewards program. On the opposite end, debit cards for the most part are regulated because they are not a loan like a credit card payment. This regulation meant the fees are required to be more in-line with a true processing cost and not one that factors in interest or risk.
What you can choose is how you are charged when a low-cost card is used.
With Flat-Rate Pricing
- •Every transaction is charged the same blended rate
- •It does not matter whether the card is cheap or expensive
- •When a low-cost card is used, the processor keeps the savings
With Interchange-Plus Pricing
- •The actual card network cost is passed through
- •A transparent markup is added on top
- •When a low-cost card is used, the fee automatically drops
- •The savings stay with the operator
This difference has nothing to do with changing customer behavior. It is purely about pricing structure.
Who Keeps the Savings When a Cheap Card Is Used?
To illustrate how this works in practice, consider a common $14 car wash transaction paid with a low-cost debit card.
Flat-Rate Pricing Example
- Transaction amount: $14.00
- Flat rate charged: approximately 2.6% plus $0.10
- Total fee paid: approximately $0.46
Even though the card itself is inexpensive to process, the flat rate stays the same.
Interchange-Plus Pricing Example
- Transaction amount: $14.00
- Estimated card network cost: approximately $0.25
- Example processor markup: approximately $0.10
- Total fee paid: approximately $0.35
Same customer. Same card. Lower fee.
Per-Transaction Difference
- Flat-rate pricing: approximately $0.46
- Interchange-plus pricing: approximately $0.35
- Difference: approximately $0.11 per wash
That difference exists only because the pricing model allows low-cost cards to actually be low-cost.
Monthly Savings for a Car Wash
Using the same conservative $0.11 per-transaction difference, here is what that means at common monthly volumes for a single car wash.
| Monthly Transaction Volume | Estimated Monthly Savings | Estimated Annual Impact |
|---|---|---|
| 2,500 single washes per month | $275 | $3,300 per year |
| 3,500 single washes per month | $385 | $4,600 per year |
| 5,000 single washes per month | $550 | $6,600 per year |
These savings come from the same customers and the same cards. The only difference is how fees are structured.
For operators with multiple sites or growing express washes, these numbers scale quickly.
Why This Matters for Car Wash Operators
Flat-rate and tiered pricing models are designed for general retail, not for high-frequency, low-ticket environments like car washes. They rely on averaging and padding to manage risk for the processor.
Interchange-plus pricing aligns cost with reality. When a card costs less, you pay less. When a card costs more, you can see exactly why. Over thousands of transactions, that transparency and alignment make a measurable difference.
Get Clarity and Peace of Mind
If you are not sure whether your current processor is costing you more than it should, the best next step is straightforward.
Share your current processing statement with us.
We will review it and explain:
- •What you are actually paying
- •Where your fees are coming from
- •Whether a different pricing structure would meaningfully improve your margins
There is no obligation to switch. Even if you decide not to go with FlexWash, you will walk away with clarity and peace of mind about your payment processing.
For car wash owners handling thousands of card transactions every month, that understanding alone is valuable.
Ready to Optimize Your Payment Processing?
Understanding your payment processing costs is the first step to protecting your margins. Let us review your current statement and show you exactly where your money is going.