Are you trying to make a payment and wondering what is a transaction fee? The answer is simple. This fee refers to the cost that payment service providers charge every time they process an electronic payment. These charges are typically applicable on credit cards, whether it is a physical or an online transaction.
Here is a transaction fee example to help you understand the concept better:
A credit card company charges 2% as a transaction fee on payments. So, if you make a payment of ₹10,000, you need to pay ₹200 as a transaction fee. Remember that the transaction fee may be different across service providers.