Full disclosure, I am a provider of merchant services. YES you want pass thru, NEVER Tiered pricing. 0.35% basis points is not 3.5% . Depending on your volume, $0.05 per swipe is not unreasonable. What I didn't see is the other fees, e.g. Statement fees, annual fees, PCI fees, and all the other fees that may not be fully disclosed in the contract but will be in the terms and conditions, these can add up to hundreds of dollars. Even if I don't get your business, I am always available to answer questions or review contracts before you sign. Here is an example for basis points: $20,000 x 0.35%=$70.00, this is the markup or profit the provider is making above pass thru pricing. Remember that a provider can only negotiate off the profit that they make, Interchange is set by the card brands and is set in stone. You can drive yourself crazy trying to find ways to reduce your fees. The best way to gauge your rate is to track the effective rate. To calculate your effective rate is simple, take your total dollar amount of fees and divide it by the total amount of volume, this will give your effective rate. You want to be as close to 2% as possible. Best wishes for your new venture!