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Introduction: The Changing Landscape of Payment Processing in the Restaurant Industry
The payment processing landscape continues to evolve rapidly in restaurants, with the majority of multi-unit brands layering digital payments on top of traditional in-store dining and takeaway. The global digital payments market is expected to grow from $125.94 billion in 2024 to $137.43 billion in 2025 — a compound annual growth rate (CAGR) of 9.1%
Mobile payments have overtaken cash and cards for many consumers, cementing their role as the primary payment method.
QR code payments are seeing explosive growth, with the global market expected to reach $45.9 billion by 2032, up from $11.8 billion in 2023 — a projected CAGR of 16.27%
Meanwhile, 45% of consumers now say they would choose a brand that offers mobile payment over one that does not.
As digital platform payment processing becomes more embedded in tech stacks, operators are facing higher rates and fewer options. Many are forced to juggle separate processing partners for in-store and online transactions — creating complications such as managing multiple merchant accounts, losing out on negotiated credit card rates, or being locked into the preferred processor of their first-party ordering tech provider.
Satisfaction with merchant service providers continues to be an issue, with high fees and technical difficulties at the POS remaining key pain points.
Over the past two years, we’ve seen restaurant tech providers roll out their own native payment processing — requiring restaurants that use their online ordering tools to lock into bundled payment programs and accept pre-set rates. In this article, we’ll break down the risks of those limitations, highlight the value of processor-agnostic platforms, and offer up-to-date tips for negotiating credit card processing rates in 2025.
In this article, we’ll discuss the challenges restaurants face with technology providers, how payment-processing-agnostic providers are the way to go, and how to negotiate credit card processing rates in 2025.
The Problem with Limited Payment Processing Options
Restaurants facing limitations in selecting their own payment processor for digital orders face several issues:
Higher rates (+ markup on top of CC rate)
Disparate systems between in-store and online/mobile payments
Operational complexity
Chargeback challenges and lack of chargeback support
As of 2024, the average credit card processing fee was approximately 2.24% per transaction — and with restaurant profit margins averaging only 3–5%, even a small markup can significantly impact bottom lines.
For this reason, it is imperative that restaurant technology providers consider the impact of locking customers into payment gateways and that restaurant operators look at processor-agnostic options while evaluating their online ordering tech stack.
The Benefits of a Processor-Agnostic Approach + The Importance of Mobile Pay
Restaurants looking for an online ordering or catering tech partner should seek platforms that are processor-agnostic and fully integrated with mobile wallets like Apple Pay and Google Pay. In 2025, 55% of consumers say contactless payment is one of their top three priorities when choosing a restaurant — making mobile payment options a must-have both online and in-store.
Lunchbox’s OPEN Payments solution gives restaurants the ability to choose from integrated processors such as PAR Pay, Adyen, Fiserv, WorldPay, Payco, Shift4, or Lunchbox’s native processor:
Ability to keep existing negotiated rates
Unified payment experience across channels
PCI-compliant infrastructure
Transparent interchange rate visibility
Apple Pay and Google Pay compatibility
In-store QR code payment via Scan-To-Pay on the Lunchbox app
This kind of open, integrated system brings efficiency, cost savings, and better customer experience to restaurant operators.
Table Source: (Meetanshi)
Impact of High Fees and How to Avoid Them: + 10 Expert Tips on Negotiating Credit Card Processing Rates
When it comes to running a successful restaurant, managing expenses is as crucial as serving great food. One often overlooked area is the cost of credit card processing fees. These fees can significantly eat into your profits, especially if your payment processors mark them up. However, with the right strategies, you can negotiate better rates and keep more of your hard-earned money. Here are some expert tips:
1. Understand Your Current Fees
Audit Your Statements: Review your current credit card processing statements thoroughly. Understand the different types of fees you're being charged, such as interchange fees, assessment fees, and any additional processor surcharges.
Know the Industry Standards: Research to understand what constitutes a competitive rate in the industry. This knowledge will empower you during negotiations.
2. Leverage Your Transaction Volume
Highlight Your Volume: If your restaurant processes a high volume of transactions, use this as leverage. Payment processors often offer better rates for higher volumes as it means more business for them.
Consider Future Growth: Discuss your expansion plans if you're a growing business. Processors may offer lower rates for the potential of increased future transactions.
3. Ask for Interchange-Plus Pricing
Opt for Transparency: Request interchange-plus pricing, which breaks down the exact interchange fee charged by the card networks and the processor’s markup. This model is often more transparent and cheaper than tiered pricing.
4. Be Ready to Negotiate Markups
Negotiate the Markup: Focus on negotiating the processor's markup, as interchange fees are non-negotiable. Even a small reduction in the markup can lead to significant savings.
5. Watch Out for Hidden Fees
Identify and Challenge Hidden Fees: Look out for and question any unnecessary fees or surcharges. Ask your processor to waive or reduce them.
6. Get Multiple Quotes
Shop Around: Don’t hesitate to get quotes from multiple processors. This not only gives you a sense of what’s available in the market but also provides you with more bargaining power.
7. Highlight Competitor Offers
Use Competitor Rates as Leverage: If you receive a more competitive offer from another processor, use it as a bargaining chip to negotiate lower rates with your current processor.
8. Consider Bundled Services
Explore Bundling: Some processors offer bundled services, like POS systems or business analytics tools, at a discounted rate. Evaluate if these bundles provide value and savings for your business.
9. Review and Renegotiate Regularly
Regular Reviews: Make it a habit to review your processing fees regularly. Market rates change, and what was a good deal a year ago might not be competitive now.
10. Don’t Hesitate to Switch
Be Open to Switching: If your current processor is unwilling to negotiate, don’t be afraid to switch to a more cost-effective provider. The savings can be substantial over time.
By implementing these strategies, you can effectively negotiate better rates for your credit card processing, reducing operational costs and boosting your bottom line. Remember, every penny saved in fees is an extra penny in profit for your restaurant.
Conclusion: Why Choice Matters in Payment Processing
As the restaurant industry becomes increasingly digital, payment flexibility is no longer optional — it’s essential. Restaurants that embrace processor-agnostic platforms and offer mobile-first payments will see stronger customer loyalty, better operational efficiency, and greater control over their finances.
By staying educated on fee structures and using negotiation strategies, operators can protect their margins and make smarter long-term decisions. In 2025, the restaurants that win will be the ones that treat payments not as an afterthought — but as a strategic pillar of growth and profitability.
