Interchange rates are set and regulated by card brands such as Visa ®, Mastercard ®, Discover ®, and UnionPay. 1.35% to 2% . Transactions made by merchants with Merchant Category Codes 6012, 6211, 9311 or 9399 meeting certain other criteria can qualify for ‘Me to Me’ Interchange fees. This is called cost-plus or interchange-plus pricing. It affects merchants and consumers. 1 . MCC can affect a merchant’s interchange rate, now we’ve spoken about interchange briefly when we discussed tiered pricing v. cost plus pricing. Setting interchange rates at the appropriate level also helps ensure that both issuers and acquirers deliver services that optimise the effectiveness of the payments system and spur development of innovative payment solutions. Visa Purchasing. Generally, acceptance based rates (e.g., service station, supermarket, and recurring) take precedence over product-based rates (e.g., Platinum and Business). What data is required to qualify for each rate? The changes are as follows: Visa has eliminated the Tier 2 program Supermarkets, gas stations and hotels all receive special pricing. To further explain, let’s take a look at some of Visa’s interchange rates. It is set and regulated by the card brands. Impact interchange rates. Interchange rates change twice a year – in April and October. Watch our video . Sources: Visa USA Interchange Reimbursement Fees published on April 13, 2019, Mastercard 2019-2020 U.S. You must get an MCC code for your business immediately; otherwise, you will be missing out on lots of opportunities and benefits. Mastercard, for example, currently assigns their interchange rates based on card type, transaction type, business type/Merchant Category Code (MCC), and/or transaction volume. CNP CPS-qualified transactions will be referred to as “Product 1,” as shown in the table below. The result is that some transaction clear at higher interchange rates than others. There are over 100 variations of interchange fees possible. At any given time, the card brands may offer discounted Interchange rates to certain industries. Your merchant category code will affect this rate. There is a precedence in which interchange fee programs and rates are applied. 0.7p to 10p + 0.01% to 1.03% Visa Business Credit. Overview MCC Groups Airlines MCC 3000 - 3350 MCC 4511: Air Carriers, Airlines - notelsewhere classified Petrol Stations MCC 5541: Service Stations (with or without Ancillary Services) MCC 5542: Fuel Dispenser, Automated Touristic MCC 4111: Transportation (incl. Your interchange rate will be low and you may be eligible for a convenience fee. Visa and Mastercard are introducing the interchange updates to support the Government of Canada in lowering the average effective interchange rate to 1.40% on domestic consumer credit transactions. Interchange rates are the fees a card issuer like MasterCard or Visa charges a merchant when processing payments. Interchange Reimbursement Fees Visa Restaurant Rates; To qualify for the below restaurant rates, merchants must be classified as a restaurant or quick-service merchant (MCC of 5812 or 5814). The Transaction … Merchants should direct all questions relating to interchange fees to their Acquiring Institution. 0.3% to 2% . The interchange rates will vary depending on your MCC, the type of transaction, method of acceptance and card mix (types of card). Current Rates . Visa Charity Rates; Visa has a special rate category specifically designed for nonprofits. Interchange rates are set by credit card companies such as MasterCard, Visa, American Express, and Discover. This rate is specific to the utility industry, MCC 4900 and is targeted toward the recurring payments market, specifically utility bills. Interchange fees are important because they are collected by banks that issue credit and debit cards, and they account for the vast majority of a business’ credit card processing expense. Overview MCC Groups Bill Payment MCC 4829: Money Transfer - Merchant MCC 9311: Tax Payments MCC 9222: Fines MCC 9402: Postal Services - Government Only MCC 4900: Utilities—Electric, Gas, Heating Oil, Sanitary, Water MCC 4814: Telecommunication Services including but not limited to prepaid phone services and recurring phone services MCC … Visa will rename and modify the interchange rates for card-not-present CPS qualified transactions into unique interchange rates by consumer credit products. Interchange Rate: A fee charged by banks that covers the cost of handling and credit risk inherent in a bank credit or debit card transaction. Transactions with the qualifying MCCs can be face-to-face or accepted in a card not present environment. Not all nonprofits will qualify – but if you’re classified with the MCC of 8398, or as a “Charity or Social Service” organization, then you’ll qualify for far-reduced interchange rates. Below are the basic qualifications, plus you’ll see each type of card that’s eligible for restaurant rates… You won’t be assessed a specific fee or penalty based on the downgrade. (Select "Visa Canada Interchange Rates" link on the right hand menu) MasterCard Canada; Interac; Discover (If you cannot remember your Discover password, please contact the Moneris Service Centre at 1-866-319-7450 for assistance) UnionPay; Merchant Direct. Flexible interchange rates make it possible for electronic payments to deliver maximium value at the lowest cost for both merchants and consumers. Payment processing companies make money by putting a markup on top of the interchange rate. The Misuse of Authorization Fee is a preexisting fee that has simply had its applicable timeframe changed. A new Utilities interchange rate is being introduced for MCC 4900. Business-to-Business: Transactions eligible for the B2B rate must be CPS qualified (not qualifying for Level 2 rates) and be processed by merchants operating in qualified Merchant Category Codes (MCCs). These fees are published on Card Scheme websites (such as Mastercard and Visa). Germany - Domestic Interchange Fees. For instance, Visa’s current Interchange guide lists CPS/Utility as receiving a flat Interchange of $0.75. Visa Canada Interchange Reimbursement Fees The following tables set forth the interchange reimbursement fees applied on Visa financial transactions completed in Canada.1 Visa uses interchange reimbursement fees as transfer fees between issuers and acquirers to balance and grow the payment system for the benefit of all participants. The current Visa and MasterCard Utility Interchange rate is $0.75 for both consumer credit and debit transactions that meet category requirements. Instead, the transaction will just fall into a new category with higher credit card processing rates. Keep reading to … Financial Institutions (MCC 6012) and Non-Financial Institutions (MCC 6051) are the only business types that are eligible for the CPS/Debt Repayment interchange program, and certain transaction criteria must be met for a transaction to qualify for these rates. A merchant category code (also known as MCC) can affect the interchange rate and credit card processing fees a business pays for the products or goods it sells. Interac will calculate the interchange fee on a per transaction basis. The new MES interchange rates provide differentiated operating guidelines to help participants compete more effectively in the payments market and to increase merchant acceptance for payments currently captured by cheque and other forms of payment. Interchange Downgrade Fees As I briefly mentioned earlier, interchange downgrades cost more to process. Debit Products. 1 . For each MCC Code, companies charge different fees above Visa’s cost; this cost is called interchange. Will my processing costs increase or decrease? These rates are current as of April 2020, and now effective July 2020 for the public. x MCC 4900 - Utilities x MCC 6513 - Real estate agents and managers—Rentals x MCC 9311 - Tax payments x MCC 8398 - Charitable and Social Service Organizations Transaction amounts equal to or greater than CA$1,000 x MCC 8211 - Elementary and secondary schools x MCC 8220 - Colleges, universities, professional schools, and junior colleges x MCC 8351 - Child care services Performance … It’s a number that’s more important than you may realize. Interchange fee – Interchange is a fee that an acquirer pays to issuers for each transaction that they initiate and that is subsequently approved by the issuer. While Interac Corp. has a role in setting the interchange fee rate, it will not receive any revenue from the fee. 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