Merchant Card Processing

Interchange fees are set by Visa & Mastercard & paid to the customer's bank (issuing bank). These will vary depending on the type of credit card (consumer vs. premium) and how it is entered (in person vs manually keyed).Processors and Merchants of All Sizes are Bound by the Same Interchange! 

The Key to Your Savings is all Buried in the "Plus"

Interchange-plus pricing is generally cheaper to accept than fixed pricing, especially for companies whose customers predominantly use debit card payments. Because the interchange and assessment fees are so much lower on debit cards, fixed flat rate pricing typically overcharges for these transactions, making IC Plus pricing is the way to go when possible! 

Interchange plus pricing is still uncommon because it typically has the lowest margins for a processor. The processor passes the true Visa and Mastercard costs on to the merchant and charges only a single markup (%) on top of the processing volume. IC Plus offers our traditional merchants "interchange plus pricing" to provide transparent pricing for our valued clients.

Flat rate pricing typically has a flat percentage and a per transaction fee, regardless of the types of credit cards used or how they are entered. This is quickly becoming the most common pricing method for card processing as it is easy to understand, but can be quite costly to merchants. Companies like Paypal and Square utilize this type of pricing to simplify fees, but by creating this structure forces merchant to pay a premium!

Tiered pricing usually consists of having a lower "qualified" rate for certain transactions and higher "mid" and "non-qualified" rates for others. This is one of the most common pricing method with old-school processors, as they can entice merchants with a low "qualified" rate. Unfortunately they don't spend much time explaining the rest of their costly mid and non-qualified tiers that many cards end up clearing at.

Interchange Differential is another common pricing method among old-school processors. Similar to tiered pricing, "qualified" and "non-qualified" fees are charged, but merchants are also charged "interchange differential fees" on top of most cards. This results in merchants paying multiple fees on the same transaction, essentially being double billed.