Interchange-plus is a way of pricing credit card processing where you pay what the card networks charge, plus a fixed markup that you can see on your statement. It is the easiest pricing model to check, because the processor's share is listed separately from everyone else's.
The three parts of every card fee
Every card sale you run carries three costs:
- Interchange. Set by the card networks and paid to the bank that issued the customer's card. It changes with the type of card (debit, credit, rewards, business) and how you took it (tapped or dipped in person, keyed in, or online).
- Assessments and network fees. Paid to Visa, Mastercard, Discover, or American Express.
- The processor's markup. What your processor keeps for running the account.
The first two are the same no matter which processor you use. The markup is the only part a processor controls.
How interchange-plus works
On interchange-plus, interchange and network fees are passed through to you at cost. The processor then adds its markup, usually quoted as a small percentage plus a few cents per transaction. The markup stays fixed. Interchange moves when the card networks change it, and both show on your statement.
How it compares with other pricing
Flat-rate pricing
One rate for every card. It is simple to understand, and it is how Square and Stripe price by default. The trade-off is that the rate doesn't change with your volume or card mix, so on cards that cost less to process, such as debit, the processor keeps the difference.
Tiered pricing
Sales are sorted into buckets, often called qualified, mid-qualified, and non-qualified, each with its own rate. The processor decides which bucket a sale lands in, which makes the statement hard to check.
Dual pricing
A cash price and a card price, so customers who pay by card cover the card cost. It is a different approach from the three above: instead of lowering what you pay, it offsets it. See our pricing programs.
How to tell which model you're on
- If your statement lists card categories line by line with their own rates, you are probably on interchange-plus.
- If it uses words like "qual," "mid-qual," or "non-qual," you are on tiered pricing.
- If it shows one rate for everything, you are on flat-rate pricing.
Our guide on how to read a merchant statement walks through where to look.
Who interchange-plus fits
It suits businesses that would rather absorb the card cost and keep one price for every customer: B2B, businesses that invoice, and professional services. If you'd rather offset the fee, dual pricing may fit better. At ClearCost Payments we price both from your statements and show them side by side. See our pricing programs.
This guide is general information, not legal or financial advice. Card-brand rules and state laws change, so check the current rules for your business.