Transaction fees refer to the charges that a financial institution or payment processor may impose when processing a transaction. This can include credit card purchases, online payments, and other types of electronic funds transfers. The fee is typically a percentage of the total amount being transferred or processed, and it helps to cover the costs associated with verifying the legitimacy of the transaction, authorizing the payment, and processing the funds. In some cases, merchants may also choose to pass on these fees to their customers as part of the overall cost of goods or services.