What is Interchange Plus

What is Interchange Plus?

Interchange Plus, or IC+, is an alternative pricing model for merchant accounts, traditionally preferred by those with higher processing volume.

Payment providers, such as Beanstream, are charged an interchange fee by the card brands (Visa, MasterCard, or AMEX) for every transaction processed. This interchange is set by the card brand, and every payment provider pays the exact same fee.

IC+ pricing passes that exact fee from the card brands with a minimal markup, maybe 40¢ or 60¢ to the merchant.

The interchange, can differ based on card type, region, and locale of the card owner.
  • Visa will have a set interchange fee for their basic card, another for their rewards or travel card.
  • Visa will also have a different interchange fee for each of those card types based on country, Canada vs. America vs. the UK.
  • Finally, Visa will charge a higher fee for cards used in different countries. If your customer is visiting Canada on a vacation from Italy, the card is ‘foreign’ and will have a higher interchange fee.
For a US Standard World Elite MasterCard in USD the interchange is
3.25% + 0.10 (set by MasterCard) + .60¢ (the markup by the payment provider)

For a US Charity MasterCard in US the interchange is
2.00% + 0.10 + .60¢

Note: the additional fee of 60¢ can differ based on your processing volumes and is simply used as an example.

While this can seem confusing, it can potentially save merchants money in fees. The alternative is a blended or fixed rate.

A blended rate takes all these fees and blends them into one. This means you pay one flat fee, instead of potentially paying a different fee on each transaction. So no matter the type of card your customer is choosing to pay with, you pay 2.8% + 30¢.

While blended rates are great for lower volume merchants who don’t want to deal with multiple fees, in turn, fluctuating bills for higher volume merchants you can save money by moving to IC+.

If you are not sure which pricing structure is right for you, you can contact our sales team. Better yet, we can grow with you. You can start at a blended rate and as your business evolves we can seamlessly move you to an IC+ structure. We are Your Partner in Payments, helping you get the best rate for your business.
Nicole Stright

Nicole Stright

Nicole is our coffee dependent content specialist. With a quick-witted way with words, she could make you enjoy reading an instruction manual. She was born American, raised Canadian and has lived briefly in Poland. A quintessential west coastian she can be found running the seawall, practicing savasana in yoga or enjoying an over-hopped I.P.A. Nicole is responsible for all of the bean puns as well as creating compelling copy driven by analytics that converts. She strives to simplify the complicated and wants readers to easily understand the often convoluted industry of payments.
Nicole Stright