The verdict in three sentences
A Toronto IT services firm collecting CA$2 million a year would pay roughly CA$44,000 to CA$70,000 in fees if every invoice went through card processing at 2.2 % to 3.5 %. The smart setup routes each invoice to the cheapest rail: pre-authorized debit or EFT for retainers and large invoices, a pay-by-link button on every invoice for clients who insist on card. CFOs should judge a gateway on effective cost per dollar collected and days sales outstanding, not on the headline rate.
Where the fees really come from
Card processing in Canada is usually priced as a blended rate or as interchange plus a markup, and commercial or premium cards cost noticeably more than consumer debit. On top of the rate you may pay per-transaction fees, monthly account fees, chargeback fees and currency conversion on US clients. Payout timing matters too: funds that land in 2 business days instead of 5 shorten your cash cycle.
Bank rails are far cheaper for B2B. Pre-authorized debit (PAD) and EFT usually carry a small flat fee per transaction, Interac e-Transfer is common for smaller clients, and wires suit large one-off invoices. If you plan to pass card fees on to clients, check the card networks' surcharging rules first.
| Payment rail | Typical fee, 2026 ballpark | Cost on CA$2M if used for everything | Settlement |
|---|---|---|---|
| Commercial or premium credit card | 2.5 % to 3.5 % | CA$50,000 to CA$70,000 | 1 to 3 business days |
| Consumer and small business credit card | 2.2 % to 2.9 % | CA$44,000 to CA$58,000 | 1 to 3 business days |
| Pre-authorized debit (PAD) | Flat CA$0.25 to CA$1.50 per debit | Under CA$1,000 | 2 to 5 business days |
| EFT or bank transfer with invoice reference | Flat bank fee, often low | Under CA$1,000 | 1 to 2 business days |
| Interac e-Transfer for business | Low flat fee, limits per transfer | Not suited to large invoices | Near real time |
| International wire | CA$15 to CA$50 per wire | Depends on count | 1 to 3 business days |
Choosing a gateway model
Toronto firms generally choose between a few gateway models. Rank them on effective rate at your volume, PAD support, accounting integration and how fast payouts reach your account.
| Gateway model | Pricing model | Strength | Watch out for | Fits |
|---|---|---|---|---|
| Developer-first international gateway | Flat percentage plus fixed fee, public rates vary by plan | Fast setup, good invoicing tools | Commercial card mix raises your effective rate | Firms starting online collection |
| Bank merchant account | Interchange plus, negotiated | Lower cost at volume | Longer onboarding, contract terms | Over CA$1M a year in card volume |
| Accounts receivable automation platform | Subscription plus transaction fees | PAD, reminders, reconciliation | Subscription cost on small volumes | Many recurring invoices |
| Accounting software payments add-on | Percentage per invoice paid | Native in your ledger | Limited routing control | Small teams, low volume |
| Payment link built into a client portal | Gateway fees plus build cost | Full control of routing rules | Needs development | Firms with custom billing |
If you want routing rules and a client portal built around your billing, Kolonell's prices are public: a simple custom application costs 3,810 to 6,100 EUR (2,500,000 to 4,000,000 FCFA), delivered by its nearshore team in Dakar. Store only what you need about client payers and follow PIPEDA principles for consent and safeguards.
Mini case study
Illustrative example: Priya, CFO of a managed IT services firm in Toronto, invoices CA$2 million a year across 1,200 invoices. Today 70 % of clients pay by card at an effective 2.9 %, costing CA$40,600, and DSO sits at 48 days.
She moves monthly retainers to PAD and keeps card only for clients who ask for it. The new mix is 20 % card (CA$400,000 × 2.9 % = CA$11,600), 65 % PAD and EFT at about CA$800 in total, and 15 % by wire or e-Transfer at roughly CA$600. Annual fees fall from CA$40,600 to about CA$13,000, a saving of CA$27,600. Automated PAD collection also brings DSO down to 35 days, releasing about CA$71,000 of cash (2,000,000 / 365 × 13).
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FAQ
What card processing rate should a B2B firm in Toronto expect?
As a 2026 ballpark, 2.2 % to 3.5 % depending on card type and pricing model. Commercial cards sit at the top of that range, so your client mix matters more than the advertised rate.
Is pre-authorized debit worth setting up for B2B clients?
Yes for retainers and recurring invoices, because a flat fee under CA$1.50 replaces a percentage. On a CA$5,000 monthly retainer, that is roughly CA$1 instead of CA$145 at 2.9 %.
Can we pass card fees on to clients?
It is possible within the card networks' surcharging rules, which require notice and caps. Many firms instead offer a 1 % early payment discount for PAD or EFT, which nudges clients off cards.
How long does it take to add pay-by-link to our invoices?
An accounting add-on can be live in 1 to 2 weeks. A client portal with routing rules and automatic reconciliation typically takes 6 to 10 weeks.
Which data do we need to protect?
Never store full card numbers yourself; let the gateway tokenize them to keep your PCI DSS scope small. Bank details for PAD must be secured and handled under PIPEDA principles.
Let's scope your project. Share your annual collections, invoice count and accounting stack, and we will scope the payment integration, its budget and its timeline. Detailed quote within 48 h. WhatsApp +221 77 596 93 33.
Mohamed Bah
Fondateur, Kolonell
Passionate about digital and entrepreneurship in Africa, Mohamed has been helping Sénégalese businesses with their digital transformation since 2020. Founder of Kolonell, he believes every SME deserves a professional and accessible online présence.
