Merchant Account Interchange Plus Pricing
Depending on your customer base; sometimes the typical bundled Qualified, Mid Qualified and Non-Qualified pricing plans that you’ll find offered by merchant providers may not be best for your business. If you are seeing a large majority of “Non-Qualified” transactions on your statement you may want to look into the Interchange Plus pricing plan.
Interchange plus is the only plan in which all transaction rates are affected directly by the Visa/MC Interchange Rate (a set of pre-defined by Visa/MC rules that determines pricing for each card) that the merchant provider is charged directly. So instead of being billed a Qualified, Mid Qualified, and Non-Qualified bundled rate, you are billed whatever Visa/MC charges for that particular card plus a small markup determined by the merchant account provider.
When Interchange plus pricing was first introduced it was only available to certain merchants that had extremely high volume but now due to the competitive nature of the industry and the fact that Visa/MC is now more transparent about their Interchange rates merchants now find it easier to sign up for Interchange Plus pricing if they so wish. Again, it’s not best for everyone due to it’s lack of simplicity but it may be worth looking into if you find that you are seeing lots of downgrades to Non-Qualified.
Real-Time Visa/MC Interchange Charts:
Many Merchants will not understand these charts as it breaks down the pricing of certain types of cards that an untrained eye may not be able to decipher. But the following real-time Visa/MC Interchange Charts (directly from their respective brands) give an overview of the different Interchange Categories that are set by Visa/MC. If you have questions on these rates and card types it is best that you deal with your merchant provider or contact a merchant provider expert/resource (such as MerchantSeek).
Again these rates are not as “simple” to decipher as there are literally hundreds of different rate categories with card types that are also confusing to understand unless you are an expert in the merchant provider industry. Contact your merchant provider or email MerchantSeek via our “Contact Us” page for answers to merchant account related questions.
How can I tell which category a card will fall under?
We are also often asked if there is a way to tell when a merchant takes a card what “bucket” or category the transaction will fall under when you take the card – the answer is no you cannot. This was really the one of the initial reasons for providers offering the standard “Qualified, Mid Qualified, and Non-Qualified” pricing. It narrows down hundreds of confusing categories into 3 categories that are easier to understand. So though you will never be able to tell where your card will land you do have an easier time reading your merchant statements.
Interchange plus is a great tool for merchants that take a lot of non-traditional credit cards that often downgrade to the lowest “Non-Qualified” level. But if you’re satisfied with the current qualification level of your merchant account (or if you don’t have an account yet), starting out with a 2 or 3-Tier rate with a provider that will allow you to change down the road is a good way to get a feel for whether or not Interchange plus is for you.
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