A Complete Guide to Interchange Fees and Rates

 Interchange fees are the fees charged by card issuers to merchants for each credit or debit card transaction. They are typically a percentage of the total transaction amount, plus a per-transaction fee. interchange rates are set by the card networks (Visa, Mastercard, etc.) and are the same for all merchants.

Why Do Interchange Fees Matter?

Interchange fees are one of the biggest costs of accepting credit and debit cards. They are generally much higher for debit card transactions than for credit card transactions. For example, the average interchange fee for a Visa debit card transaction is about 1%, while the average fee for a Visa credit card transaction is about 2%.

How to Reduce Interchange Fees

There are a few things you can do to reduce your interchange fees:


  1. Negotiate with your processor: If you are unhappy with the interchange fees you are being charged, talk to your credit card processor. They may be able to negotiate a lower rate for you.

  2. Use a flat-rate pricing model: Some processors offer a flat-rate pricing model, where you pay a single, fixed fee for all credit and debit card transactions, regardless of the interchange rate. This can be a good option if you process a lot of transactions.

  3. Use a tiered pricing model: With a tiered pricing model, your processor will group transactions into different categories (qualified, mid-qualified, and non-qualified) and charge different rates for each. This can be a good option if you don’t process a lot of transactions or if you want more visibility into your costs.

  4. Use a subscription model: With a subscription model, you pay a monthly fee for access to lower interchange rates. This can be a good option if you process a lot of transactions and want to save money on fees.

  5. Use a rewards card: If you have a rewards credit card, you can use it to pay for purchases and earn points, miles, or cash back. This can be a good way to save money on interchange fees if you are careful about how you use your rewards.


Interchange fees are an important part of the credit and debit card processing landscape. By understanding how they work and what you can do to reduce them, you can save money on your processing costs.

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