Total Cost Interchange Plus Pricing Credit Card Processing
There are three cost components in all credit card transactions. Each cost component is made up of two fees: a percentage of the sale and a fee per item. The item fee often takes the form a fee per authorization.
- Interchange. Interchange is set by Visa/MC/Discover, collected by the credit card processor, and paid to the bank that issues the credit or debit card. Interchange accounts for 80-90% of a transaction's cost.
- Dues and Assessments. Also known as Assessments. Dues and Assessments are paid to the Card Associations for the use of the card's brand and processing network. Assessment fees are much smaller than Interchange fees. 2011 Assessments for Visa, MasterCard, and Discover range from 0.11% - 0.12% + $0.195 - $0.185 per authorization.
- Processing Services. This is the fee charged my the credit card processor to authorize, settle, and fund sales to the merchant. In interchange plus credit card processing, the fees for Processing Services are usually closer in size to fees for Assessments than fees for Interchange. For example, Interchange Plus 0.10% + $0.10 per authorization.
In the example below for MasterCard interchange rate Merit III, Total Cost is calculated by adding the three cost components together: Interchange + Assessments + Processing Services = Total Cost.
Call Burlington Bank Card at 1-800-758-1002 or contact us to learn more about Interchange Plus.
- Interchange: 1.58% + $0.10
- Assessment: 0.11% + $0.0185
- Processing Services: 0.10% + $0.10
- Total Cost: 1.79% + $0.2185