Reviewing a merchant services or card terminal agreement

A merchant services agreement lets a business take card payments and decides how much of each payment it keeps, how long it waits for the money, what happens when a customer disputes a transaction, and how much the terminal costs over a term the business cannot leave. The acquirer's terms and the terminal provider's lease arrive together and are often with different companies. I review the agreement from the merchant's side and return it marked up with a written explanation of what it commits the business to and the terms worth asking to change, for a fixed fee of £495 in three working days.

Who this is for

Shops, restaurants, tradespeople, professional practices and online businesses in England and Wales taking card payments through an acquirer, a payment facilitator or a terminal provider, whether a first agreement or a switch to a cheaper provider. The merchant and the provider are businesses; the merchant's customers are protected by consumer law and the card scheme rules.

What to look for in a merchant services agreement

The regulated service and the counterparties

Card acquiring is a payment service regulated under the Payment Services Regulations 2017, so the acquirer must be authorised or registered, and the merchant should check the register. The review identifies the parties: the acquirer, the payment facilitator or reseller that sold the agreement, the terminal provider and any finance company the terminal lease is assigned to, and checks which obligations are owed to whom, because the merchant may find itself with three counterparties and three terms.

Fees, blending and the right to itemised charges

Merchant fees combine interchange, scheme fees and the acquirer's margin, and providers quote a blended rate that hides the margin. Under the Interchange Fee Regulation (EU) 2015/751 as retained, an acquirer must offer the merchant unblended fees showing interchange, scheme fees and the acquirer's charge separately unless the merchant asks in writing for blended pricing. The review checks the fee schedule, the authorisation, PCI, minimum monthly and non-compliance fees, the provider's right to change fees on notice, and asks for itemised charges and for fee changes to carry a termination right.

Chargebacks, reserves and the money you have not received

The agreement makes the merchant liable for chargebacks, refunds and fines under the card scheme rules, lets the acquirer debit the merchant's account for them, and lets it hold a rolling reserve or delay settlement where it judges the merchant's risk has changed. The review checks the chargeback process and the merchant's right to contest, the size and release of the reserve, the settlement timing, and the acquirer's rights to suspend settlement, which should require notice and a stated reason and should not survive termination indefinitely.

The terminal: lease, term and the settlement on exit

The card terminal is rented under a separate agreement, for a fixed term that outlasts the acquiring agreement, with an early termination charge of the remaining rentals. The review checks the term, the renewal, the swap-out commitment for a faulty terminal, the settlement on early termination against the provider's real loss, since a charge out of all proportion to its legitimate interest is unenforceable under Cavendish Square Holding BV v Makdessi [2015] UKSC 67, and asks for the terminal term to end with the acquiring agreement. Where the merchant is a sole trader or a partnership of two or three partners the terminal hire may be regulated by the Consumer Credit Act 1974.

Data security, PCI DSS and the merchant's customers

The merchant must comply with the card industry's data security standard, complete the self-assessment the acquirer requires and pay a fee if it does not, and carries liability for a data breach involving card data. Cardholder data is personal data under the UK GDPR and the Data Protection Act 2018, and the review checks who is controller and who is processor, the breach notification obligations, and the merchant's obligations for terminal security. It also notes that the merchant may not surcharge consumers for paying by card under the Consumer Rights (Payment Surcharges) Regulations 2012.

Termination, switching acquirer and the notice period

The acquiring agreement runs for a minimum term and renews unless notice is given, and the provider reserves the right to terminate on short notice for risk, breach of scheme rules or a change in the merchant's business. The review checks the notice periods each way, the early termination charge, the treatment of settlement funds and the reserve after termination, and the merchant's right to move to another acquirer while keeping its terminal where the terminal is unlocked. The Late Payment of Commercial Debts (Interest) Act 1998 applies to sums the provider owes the merchant.

What it costs

Standard review, £495. Marked-up document and a written explanation of the changes. Three working days.

Buying online forms the engagement on payment. The scope is what the contract review page describes, you accept the Terms of Service at checkout, and I email you within four working hours to get started. If you would rather ask something first, email me.

What you get

• Your own contract returned with my amendments as tracked changes, plus a clean version with every change accepted, ready to send to the other side
• Comments in the document where a point needs explaining
• A written explanation of what I have changed and why, by email or as an attachment if it is lengthy, marking the points I would hold firm on and the ones that are negotiable
• A view on what is normal market practice and what is the other side pushing their luck
• One round of follow-up questions by email, included

What is not included

• Negotiating directly with the other side, which I quote separately once I know who is on the other side. Where the other side is willing to share a live document, I can work in that document directly
• Drafting a replacement contract from scratch
• Advice on the law of any jurisdiction other than England and Wales
• Tax, accounting or regulatory advice
• Disputes about a contract that is already signed

Questions I am often asked

The provider quoted one rate but the statements show more. Why?

Because the quoted rate is a blended figure and the statements add authorisation, scheme, PCI and minimum monthly fees on top. The review reads the fee schedule against the statements and asks for itemised charges, which the Interchange Fee Regulation entitles you to unless you asked for blended pricing.

The acquirer is holding our settlement money as a reserve. Can it do that?

The agreement will allow it, on the acquirer's judgement of risk. The review checks the reserve provisions, asks for a stated cap, a stated reason, notice, and a date by which the reserve is released after termination, and checks that settlement cannot be suspended without a reason being given.

We want to switch acquirer but the terminal lease has two years to run. Are we stuck with it?

You can switch acquirer, but the terminal lease continues on its own terms and the terminal may be locked to the old acquirer. The review checks the lease, the settlement figure and whether the terminal can be re-used, and for the next agreement asks for the terminal term to end with the acquiring agreement.

Related guidance and services

• Contract review, £495, the service this page describes
• Terms and conditions drafting, £995
• Data protection agreements and privacy terms, £795
• Reviewing an EPOS or till system contract
• Reviewing a buy now pay later merchant agreement

This page is general guidance for businesses in England and Wales, not advice on your own circumstances. Last reviewed: September 2026. Email geoffrey@caesar.co.uk.