Interchange fees represent 70%–90% of total fees on a typical processing statement. Yet most business owners have never heard of them, cannot define them, and have no idea whether their processor is passing them through honestly.
What Is an Interchange Fee?
Interchange is a fee paid by your processor to the customer's card-issuing bank on every transaction. It compensates the issuing bank for fraud risk, credit costs, and card program expenses. Your processor passes this fee through to you.
Who Sets Interchange Rates?
Interchange rates are set by Visa, Mastercard, Discover, and American Express. Your processor cannot change these rates — they are the same regardless of which processor you use. Only the processor's markup on top of interchange can be negotiated.
How Interchange Varies
By Card Type
Regulated debit cards: capped at 0.05% + $0.22. Standard consumer credit: 1.51%–1.80%. Rewards credit: 1.65%–2.40%. Corporate/business cards: 2.0%–2.65%. Premium cards (Visa Infinite, World Elite): 2.50%+.
By Acceptance Method
Card-present (chip, tap, swipe) transactions have lower interchange than card-not-present. A Visa consumer credit card might be 1.51% + $0.10 for chip-read but 1.80% + $0.10 if manually keyed.
Visa vs Mastercard vs Amex
Visa and Mastercard publish competitive, similar rate schedules. American Express historically charged more but has become more competitive after opening to third-party processors. Discover falls between the two.
See a complete breakdown of every interchange fee on your account and whether your processor is passing them through honestly.
Analyze My Interchange FeesFrequently Asked Questions
Who pays interchange fees?
Your processor pays interchange to the card-issuing bank on your behalf, then passes that cost through to you. On interchange-plus pricing, you see this as a separate line item. On flat-rate or tiered pricing, it is embedded in the bundled rate.
Can interchange fees be negotiated?
No. Interchange rates are set by card networks, not your processor. What can be negotiated is your processor's markup on top of interchange. This is where negotiation has real impact.