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An INSIDE Analysis of Credit Card Processing and the Payment Industry
Understanding the Payment Industry is a tough task. Merchants are faced with confusing statements, hundreds of various payment processing fees, and numerous processing options offered by Merchant Service Providers, Payment Gateways, and other payment processing entities. The PAYMENTINSIDER provides articles, posts, and whitepapers on the Payment Industry, including this article, Visa and MasterCard Interchange Downgrade Fees, with the goal of creating transparency in this marketplace.

Visa and MasterCard Interchange Downgrade Fees

What are the penalties or fees associated with downgraded Visa and MasterCard transactions? Downgrade fees, or surcharges, for credit card transactions are relative to your type of merchant account plan. Merchants may process under various plan types – Tiered / Bucketed or Interchange Plus / Passthrough – depending on how the provider sold the merchant on the account. For this article, we’ll assume an Interchange Plus or Passthrough type of account, as that is the … Read More »

Interchange Fees and Payment Processing

Interchange Fees are the largest component of the costs to accept credit card payments and are set by the payment card brands. These fees are the wholesale merchant account rates for the various types of credit card transactions. There are hundreds of interchange rates, which vary based on payment card brand, payment card type (credit, debit, specialty), merchant category code, amount of transaction being processed, and the amount of data being passed through as the … Read More »

History of Payments

Throughout history, people have produced goods or services in exchange for payment. What began as a bartering system has evolved into a complex and technical process, involving multiple financial institutions and businesses, numerous forms of currency, and a technical process designed to simplify and speed up the transaction for the consumer. With the focus on consumer growth, the businesses that utilize these merchant services face a steep learning curve and are an easy target for … Read More »