Beware of "free" financial services. Small businesses were overcharged by a staggering $153 billion in hidden or undisclosed fees last year, according to research commissioned by Wise.
Amount small businesses paid in unexpected fees last year
$4,400
Average Annual Cost
Per American entrepreneur
$7,200
International Business
Average cost for businesses operating internationally
Credit Card Processing Fees
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2
3
1
Understanding the Impact
The #1 hidden fee by volume
2
Industry-Wide Issue
Affects businesses of all types
3
$43.8 Billion Annually
Total cost to small businesses
Credit card processing fees top the list of hidden costs. These charges often appear as transaction fees, statement fees, monthly minimums, and markup fees that weren't clearly disclosed upfront.
Bank Account Fees
$45.2 Billion Total Cost
The largest category of hidden fees affecting small businesses.
Common Culprits
Maintenance fees, minimum balance fees, and transaction limits can all trigger unexpected charges.
The Fine Print
These fees often appear in the terms and conditions that most business owners don't have time to thoroughly review.
International Transfer Fees
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1
Advertised Rate
Low or "zero" fee transfers
2
2
Hidden Costs
Exchange rate markups
3
3
Correspondent Fees
Additional charges
4
4
Total Impact
$19.3 billion annually
International transfers are where entrepreneurs reported most commonly encountering hidden fees. "They're still a company that needs to make a profit, so how are they making their profit on each transaction?" asks June Yuan from Wise.
Lesser-Known Hidden Fees
Insurance Policy Fees
Small businesses paid $5.3 billion in unexpected insurance fees. These can include administration fees, policy fees, and charges for changes or cancellations that weren't clearly explained at signup.
Payroll Processing Fees
At $4.4 billion annually, these fees include charges for direct deposits, tax filings, year-end processing, and additional employee payments that weren't included in the advertised rate.
Fighting Back Against Hidden Fees
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Read Fine Print
Always scrutinize terms and conditions before signing up for financial services.
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Question "Free" Services
"If it's not from a fee, it's going to be from something else," warns June Yuan.
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Push Back
33% of business owners have successfully challenged hidden fees.
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Switch Providers
37% opted to change to more transparent financial partners.