Who pays interchange fees?

The acquirer pays interchange to the issuer on each card payment, then passes the cost to the merchant inside the merchant service charge, alongside scheme fees and the acquirer's own markup. Consumers do not pay it directly, but it shapes prices, surcharges and card rewards.

The flow of money

• The cardholder pays the merchant.
• The issuer keeps the interchange fee when it settles with the acquirer.
• The acquirer charges the merchant interchange, scheme fees and its own margin.

How it reaches consumers

Merchants build payment costs into their prices. In some markets they may add a surcharge for certain cards, within the limits of local rules and scheme rules. On the issuer side, interchange revenue helps fund card rewards and benefits.

Why the pricing model matters

A blended rate hides interchange inside one percentage. IC++ pricing passes interchange and scheme fees through at cost and shows the acquirer margin separately. The second model makes it easier to see what each transaction really costs.

What it means for payment operators

As the party setting prices for your merchants, you sit between the acquirer's charges and your merchants' rates. Reconciliation that brings provider fees into one model, and reporting that shows them per transaction, merchant and provider, help you price with confidence and protect your margin as volumes grow.