What are interchange fees?
Interchange is the fee the card-issuing bank receives on every card payment; the card networks publish the rates, which vary by card type, merchant category and how the card is taken.[1][2] Merchants pay it indirectly: their acquirer or processor pays interchange to the issuer and charges the merchant a "merchant discount" that includes it.[1]
- Card type: rewards and premium credit cards carry higher interchange than basic credit cards and debit cards.
- How the card is taken: online (card not present) rates are higher than in-store (card present) rates.
- Data and security: transactions that miss the network's data requirements fall to a higher "standard" or non-qualified rate.
Mastercard interchange rates, 2026
Mastercard's U.S. schedule effective April 17, 2026 sets consumer credit interchange from 1.65% + $0.10 for a card-present Core card to 2.60% + $0.10 for an online World Elite card.[2]
| Program | Core | Enhanced Value | World | World Elite |
|---|---|---|---|---|
| Merit I (card not present) | 1.95% + $0.10 | 2.10% + $0.10 | 2.20% + $0.10 | 2.60% + $0.10 |
| Merit III base (card present retail) | 1.65% + $0.10 | 1.80% + $0.10 | 1.90% + $0.10 | 2.30% + $0.10 |
| Small ticket, card present (≤ $5) | 1.65% + $0.02 | 1.80% + $0.02 | 1.90% + $0.02 | 2.30% + $0.02 |
| Standard (non-qualified) | 3.15% + $0.10 | 3.15% + $0.10 | 3.15% + $0.10 | 3.15% + $0.10 |
Debit card interchange and Regulation II
Debit cards issued by banks with $10 billion or more in assets are capped by the Federal Reserve's Regulation II at 21¢ + 0.05% of the payment, plus up to 1¢ for fraud prevention.[3] Smaller "exempt" issuers are not capped and charge the networks' regular debit rates.
| Program | Exempt issuer | Regulated issuer |
|---|---|---|
| Card present (CPS/Retail) | 0.80% + $0.15 | 0.05% + $0.21 |
| Card not present | 1.65% + $0.15 | 0.05% + $0.21 |
| Small ticket | 1.55% + $0.04 | 0.05% + $0.21 |
| Purchase | Interchange | % of purchase |
|---|---|---|
| $10 | $0.225 | 2.25% |
| $50 | $0.245 | 0.49% |
| $100 | $0.270 | 0.27% |
| $500 | $0.470 | 0.09% |
In October 2023 the Fed proposed lowering the cap to 14.4¢ + 0.04% + a 1.3¢ fraud adjustment.[4] As of November 2026 no final rule had been published, so the 21¢ cap still applies.
Interchange plus vs flat-rate pricing
Interchange plus shows each layer of the cost; flat-rate pricing hides them in one percentage.
| Interchange plus | Flat rate | |
|---|---|---|
| Price per payment | Interchange + network fees + markup | One rate, e.g. 2.9% + 30¢ |
| Debit and basic cards | Pass through at their low cost | Same price as premium cards |
| Statement | Long, line by line | Simple |
| Monthly fees | Common (statement, gateway, PCI) | Often none |
| Best for | Higher volume, larger tickets, many debit cards | New or small businesses, simplicity |
With the example inputs on the credit card processing fee calculator ($30,000 a month, 600 transactions), interchange plus costs $805.00 against $1,050.00 on a 2.9% + 30¢ flat rate. Network fees are not published on Visa's or Mastercard's public merchant pages and come from your processor's statement, so add them before you compare.
Reading a quoteAn interchange-plus quote such as "interchange + 0.30% + 10¢" means the processor keeps 0.30% of volume plus 10¢ per transaction. Ask whether network fees are passed through at cost, and list every monthly and annual fee. A "tiered" quote with qualified, mid-qualified and non-qualified rates is a different model that is harder to compare.
The Visa and Mastercard settlement
In November 2025 Visa and Mastercard signed an amended settlement with merchants that would lower average credit interchange by 0.10 percentage points for five years and cap posted rates on standard consumer credit cards at 1.25%.[5] The court granted preliminary approval on June 9, 2026; Visa's annual report filed November 5, 2026 did not yet report final approval, so the cuts had not started.[6] We will update this page when they take effect.
Card fees are a cost of every sale. To see what they do to your margin, use the profit calculator, and to compare specific processors, the Stripe and Square fee calculators.
Frequently asked questions
What is interchange plus pricing?
A way of pricing card processing in which the merchant pays the actual interchange and network fees for each transaction plus a fixed markup to the processor, such as 0.30% + 10¢.
How much are interchange fees?
For Mastercard consumer credit cards in the U.S., 1.65% to 2.60% plus $0.10 for most qualified transactions, and 3.15% + $0.10 for non-qualified ones. Regulated debit is capped at 21¢ + 0.05% plus 1¢.
Who pays interchange fees?
The merchant's acquirer pays interchange to the card-issuing bank and passes the cost to the merchant as part of the processing fee.
Is interchange plus cheaper than a flat rate?
Often at higher volumes and with many debit or basic cards, but not always. Compare full monthly costs, including network fees and monthly account fees.
What is the debit card interchange cap?
Under Regulation II, 21¢ plus 0.05% of the transaction, plus up to 1¢ for fraud prevention, for cards from issuers with $10 billion or more in assets.
Sources
- Visa USA Interchange Reimbursement Fees
- Mastercard 2026–2027 U.S. Region Interchange Programs and Rates (archived copy)
- 12 CFR Part 235 (Regulation II), sections 235.3 and 235.4
- Federal Reserve Board requests comment on proposal to lower the maximum interchange fee for debit cards
- Visa Inc. Form 8-K, Exhibit 99.1: amended class settlement agreement (Rule 23(b)(2))
- Visa Inc. Form 10-K for the fiscal year ended September 30, 2026 (Note 20, legal matters)