Credit Card Processing Rates

We believe the best way to maintain long lasting, mutually beneficial relationships with our clients is to give them an unusually transparent and fair rate.  The most common answer merchants give when asked what rate they’re paying is, “I don’t know.”  Credit card processing rates are complex, and can be quite difficult to understand.  Beacon Payments offers a straight forward, clear cut answer to the simple question of “what is my rate?”

The rate structure we offer is called Interchange Pass-Through Plus.  This is also known as Interchange-plus pricing or wholesale plus.  All of the largest companies in the United States, including Best Buy, McDonalds and Walmart process on this merchant services rate structure.  Beacon Payments specializes in offering Pass-Through Plus pricing to every client from small mom and pop shops to large multi location corporations.


How does Interchange Plus Pricing work?

All processors purchase a wholesale credit card processing rate from the issuing banks and the major card brands at the same cost.  Given all companies are buying wholesale for the same price, it is a question of how much or little does your processor mark up above wholesale to make a profit.  Beacon Payments offers a flat discount rate and a transaction fee above wholesale to keep your cost low, while most of our competitors are offering a Tiered Rate structure which results in varied surcharges.  Most small and medium sized companies process credit cards on a Tiered rate structure, which results in a low markup on some transactions, and a large markup on most others.  

The most common misrepresentation in our industry is a sales agent offering a merchant only one rate, such as 1.59% + $0.25.  DON’T FALL FOR THIS.  Above you read that all processors are purchasing the same wholesale rate (Interchange plus Dues and Assessments).  Below you’ll see the wholesale rates can climb well above 2.00%.  It is not possible for any processor to offer you a single rate below 2.00% or they would be losing money every month you process with them.

The major card brands (Visa & MasterCard) charge 0.11% for Dues and assessments.

Additionally, Visa charges an APF $0.0195 per transaction.  APF stands for Acquirer Processing Fee.  MasterCard charges an NABU fee of $0.0185 per transaction.  NABU stands for Network Access and Brand Usage fee.

The bulk of the fees you pay come from the issuing banks. They charge an Interchange fee starting from a flat 0.05% plus $.22 per transaction all the way up to 3.25% plus $0.10. 


*There are hundreds of Interchange Categories.  Below you will find the most common Interchange fees effective October 1st, 2011:

Interchange Category

Rate (multiply by total dollars)

Transaction Fee (per item)

Visa Check/Debit Card

0.05%

$0.22

MasterCard Check/Debit Card

0.05%

$0.22

Visa CPS Retail Credit

1.51%

$0.10

MasterCard Merit III

1.58%

$0.10

Visa Keyed/MOTO/Ecommerce

1.80%

$0.10

MC Keyed/MOTO/Ecommerce

1.89%

$0.10

Visa Rewards

1.65%-2.10%

$0.10

MasterCard Rewards

1.73%-2.05%

$0.10

Visa Corporate Cards (common)

2.20%-2.65%

$0.10

MC Corporate Cards (common)

2.05%-2.82%

$0.10