What is interchange++ pricing?
A card pricing model where the merchant pays three itemized layers: interchange at cost (paid to the card issuer), scheme fees at cost (paid to Visa or Mastercard), and the acquirer’s fixed margin. Each transaction shows all three, so the price follows the real cost of the card used.
In detail
A card pricing model where the merchant pays three itemized layers: interchange at cost (paid to the card issuer), scheme fees at cost (paid to Visa or Mastercard), and the acquirer’s fixed margin. Each transaction shows all three, so the price follows the real cost of the card used.
The three layers
Interchange is paid by the acquirer to the card issuer on every transaction; the rate depends on card type, region, channel and merchant category, and in the EEA consumer cards are capped at 0.2% for debit and 0.3% for credit. Scheme fees are paid by the acquirer to the network: assessment, authorization, cross-border, FX and a growing list of service fees. The acquirer margin is what the acquirer, PSP or PayFac keeps, and it is the only layer the provider controls.
How an IC++ invoice works
Under interchange++, the merchant is invoiced interchange at cost, scheme fees at cost, and a fixed margin, for example 0.10% + EUR 0.05. Three lines, every transaction. The merchant bears the variability of the first two layers, and falling interchange or rising scheme fees reach the invoice instead of the provider’s margin. Above a few million per year, most merchants and all large platforms move to IC++ or IC+.
More detail in our #PayDecoding episode on Interchange++.