Interchange Plus Pricing: Your Cost, Our Margin, Both in Plain Sight
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What Is Interchange-Plus? — Merchant Account Explained
Interchange-plus pricing is a merchant services model where you pay two clearly separated components on every card transaction:
A typical interchange-plus rate looks like: Interchange + 0.40% + $0.10. On a standard Visa credit card, the interchange might be 1.65% + $0.10, so your total cost would be 2.05% + $0.20. On a basic debit card with 0.80% interchange, your total drops to 1.20% + $0.20. Every card type costs what it actually costs — nothing more.
Learn more about interchange fee data from the Federal Reserve.
A Flat Rate Charges You the Same for These Two Cards. Only One of Them Costs That Much.
Here is the identical $100 sale, run on two different cards, at a typical in-person flat rate of 2.6% + $0.15 against interchange-plus with a visible markup.
Where Interchange-Plus Is the Wrong Answer
Every other pricing page on this site carries a section like this one, and this page should too — especially since interchange-plus is what we usually recommend.
The swipe fee savings a tax carve-out would give you are tiny next to your processor’s markup — which is exactly what this model exposes. Your bill stops being predictable. A flat rate gives you one number you can budget against. Interchange-plus moves every month with your card mix, and a heavy month of rewards cards costs more than a heavy month of debit. Some owners would rather pay slightly more for a number that never surprises them, and that is a legitimate preference rather than a mistake.
The statement gets harder to read. One blended line becomes dozens of interchange categories. That is the point — it is what makes the bill checkable — but nobody should pretend the first one is not intimidating. Ours arrives with the markup on its own line so there is at least one number you can find without hunting.
Below roughly $10,000–$15,000 a month, it usually is not worth it. Monthly account, PCI and gateway fees are real, and at low volume they can swallow the savings entirely. If you are under that line and mostly taking rewards credit, flat-rate pricing is very likely the right answer, and we will tell you so rather than sell you a merchant account you do not need. Choose the aggregator carefully though — the model carries its own account-stability risk, which is the thread running through the PayPal payment processing problems merchants report most often.
How Does It Work?
This model separates your processing cost into three visible layers — so you can verify every charge on your statement:
Why Card Type Matters Under Interchange-Plus Pricing
Under flat-rate pricing, you pay 2.6% or 2.9% for all three. Under interchange-plus pricing, you pay the actual cost for each card type.
Worked Example — Retail Business Switches to Interchange-Plus
The savings came primarily from debit card transactions — which cost 0.80% interchange versus Square’s flat 2.6%. With 40% of transactions on debit, the difference was substantial. The switch took less than a week and had zero impact on the customer checkout experience. For a full side-by-side breakdown, see Square vs merchant account. If you are still evaluating whether a dedicated merchant account makes sense at your volume, read do I need a merchant account.
This boutique is an illustrative composite, not a named client. The 40% debit share is what produces this result — a rewards-heavy merchant on the same volume would save far less. Brookside does not publish real clients’ statements, which is why the sample statement review is a composite too.
What to Expect When You Switch
Brookside reviews your current processing statement, calculates your effective rate, and produces a side-by-side comparison showing exactly what interchange-plus pricing would cost at your volume. No obligation at this stage.
Most standard accounts are approved within one to three business days. Brookside reviews any questions before you sign anything.
New terminal hardware ships same or next day after approval — pre-configured and ready to process out of the box. For a full walkthrough of the transition process, see how to switch payment processors without losing a day of sales.
Your first interchange-plus pricing statement arrives at month end. Brookside walks through it with you — explaining each interchange category and confirming the markup is applied correctly.
Frequently Asked Questions
A good interchange plus rate is a low, transparent markup over the wholesale interchange the card networks set — commonly well under 0.30% plus $0.10 per transaction on top of interchange. The lower and clearer the markup, the better; any rate bundled into a single flat number is hiding the markup rather than showing it.
Interchange plus is almost always cheaper and clearer than tiered pricing. Tiered pricing sorts transactions into qualified, mid-qualified, and non-qualified buckets and marks each up opaquely, while interchange plus passes the true interchange through and adds one visible markup — so you see every cost instead of a bucketed average.
Any business processing more than $10,000 per month. At that volume, the savings from paying actual interchange rates — rather than flat-rate or tiered blended rates — typically outweigh any per-transaction fees. Businesses with high average tickets and a mix of card types see the largest benefit.
See What Interchange-Plus Would Save at Your Volume
Send your current processing statement. We calculate your effective rate, show you what interchange-plus pricing would cost at your volume, and quantify the annual savings before you commit to anything.
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