Interchange Explained: The Network Fee Inside Your Rate

Who receives interchange

Visa describes interchange reimbursement fees as transfer fees between financial institutions. In practice, your processor or acquiring bank pays interchange to the card-issuing bank and charges you a price that covers it, along with network fees and its own markup. Visa's document says merchants buy a variety of processing services from financial institutions and all of them may be included in the merchant discount rate. On interchange-plus pricing, interchange appears as its own amount on your statement. On flat-rate or tiered pricing it is bundled into one rate, which makes it harder to check.

What moves the rate

In Visa's US schedule, three things decide which row applies to a sale: the card type (debit, prepaid, consumer credit or commercial), how the card was accepted (card present, keyed or online) and the fee program your merchant category and transaction data qualify for. The same debit card can land in different programs depending on how it is taken, as the table shows.

Debit cards from large banks are capped

Regulation II, the Federal Reserve rule on debit interchange, limits the interchange fee a covered issuer may receive on a debit transaction to 21 cents plus 5 basis points of the transaction value, with a fraud-prevention adjustment of up to 1 cent for issuers that meet the Board's standards. Issuers with less than $10 billion in total assets are exempt. Visa's schedule reflects this with a separate Regulated column: CPS/Retail, Debit is 0.05% + $0.21 for regulated cards, marked with an asterisk for the fraud-prevention adjustment, against 0.80% + $0.15 for exempt cards. You usually cannot tell from the card itself which column applies; your statement or processor reporting can.

Visa prices some of the smallest merchants separately

Two structures in the schedule cut against the assumption that a small business always pays more. The first is the Small Merchant Fee Program, a set of consumer credit rows with their own rates. The schedule states a Small Merchant Category Volume Maximum of $280,000 in gross Visa consumer credit sales, based on 12 months of Visa system activity ending September 30, 2024, and footnotes that a small merchant transaction which disqualifies for the program will be assessed at the next applicable rate. The second runs the other way. Visa's credit performance threshold criteria, effective April 18, 2026 and based on 12 months of activity ending September 30, 2025, set Retail Threshold I at 133.4 million transactions and $8.83 billion in volume, Threshold II at 86.3 million and $4.73 billion, and Threshold III at 19.2 million and $1.08 billion, each with a minimum dispute ratio of 0.020% and a PCI compliance requirement. Those are national-retailer numbers. So the schedule has a low-volume table and a very-high-volume table, and the large middle sits on the standard rows. The full conditions for both live in Visa's U.S. Interchange Reimbursement Fee Rate Qualification Guide, which is not among the public documents we checked.

Card-not-present sales have published incentives

The schedule lists Card Not Present Incentive Types 1, 2 and 3 at -0.05%, -0.10% and -0.15%, applied against the card-not-present rate. EMV Token transactions qualify for Type 1, Digital Commerce Authentication Program (DCAP) transactions qualify for Type 2, and DCAP plus EMV Token transactions qualify for Type 3, with Charity 1 and CPS/Utility excluded. The schedule states that the incentives require CPS qualification and are subject to change. This is worth knowing when you compare online pricing, because two merchants on identical processor markups can pay different interchange on the same card depending on whether their gateway tokenises and authenticates. It is a question for your gateway and processor, not something a rate sheet will show.

Commercial cards have their own tables

Business, corporate and purchasing cards are priced in separate sections of the Visa schedule. For example, Commercial Card Present is listed at 2.50% + $0.10 and Commercial Card Not Present at 2.70% + $0.10, effective April 18, 2026. The data sent with a sale can affect which commercial program applies, which is why our Level II and III guide covers it separately.

How to use this when comparing quotes

Interchange for a given card, acceptance method and program comes from the network's published schedule, so it is not the part providers compete on. Compare the markup above interchange and the fixed fees instead. If a quote bundles everything into one rate, ask for a breakdown by interchange, network fees and markup. Mastercard, American Express and Discover set their own pricing, so check each network's current documents, and download Visa's current schedule before relying on any rate on this page.

Interchange, assessments and markup on one statement

Every card transaction you accept carries three layers of cost, even when your statement shows one number. Interchange goes to the bank that issued your customer's card. Network assessments go to the card brand itself. Everything else is your provider's markup: the percentage, the per-transaction fee and the monthly fees they add. Interchange and assessments are the same whichever provider you use for a given card and a given way of taking it, which is why they are called pass-through costs. Markup is the only part providers actually compete on. When two quotes look far apart, the difference is almost always markup, or a pricing model that hides some interchange inside a bundled rate. A statement that separates the three layers lets you see which part is negotiable; a statement that blends them makes that impossible.

Why rewards cards cost you more

Premium rewards and travel cards generally carry higher interchange than basic consumer cards, and business and purchasing cards often higher still unless extra transaction data is sent with them. The customer's rewards are, in effect, funded partly by that higher interchange. You cannot choose which cards your customers carry, but you can see how your card mix is shifting. If more of your customers pay with premium cards this year than last, your effective rate will rise even though your provider has not changed a single price. That is one reason to read the interchange detail on a statement at least once a quarter.

Canada is not the US

Canadian merchants deal with different interchange programs, a separate debit network in Interac that is priced per transaction, and commitments the card networks made to the federal government about rates for smaller businesses. US-specific items such as the Regulation II debit cap do not apply in Canada. When you read interchange advice online, check which country it was written for before you act on it.

About the rate tables on this page: Visa is the only card network that publishes a public US merchant interchange schedule, so the rate tables on this site are Visa-only. Mastercard, American Express and Discover do not publish an equivalent US merchant schedule, and their rates are neither shown above nor implied by these figures. Ask your processor for the rates that apply to each network on your account.