Interchange fees serve as non-negotiable transfer fees from card brands such as visa and MasterCard between issuers (banks) and acquirers (providers). Interchange fees vary depending mainly on how the card is charged (present/not present) and the type of card (Premium vs. Standard for example)
All providers are bound by the same Cost of Interchange, and then passed on from the provider to the merchant in a variety of ways.
Some cards offer more perks than others such as rewards, loyalty rewards, cashback, infinite limits, etc. The interchange pricing of these cards is usually higher compared to Standard cards for example, which tend to have smaller limits and less payable benefits which drive the cost up.
Card brands such as Visa and MasterCard also adjust Interchange costs depending on how the transaction is made whether it be swiped, tapped, chipped, signed, keyed, etc. Standard card-present transactions always have a lower Interchange rate.
A non-domestic card is any card charged outside of its country of origin. For example, a card issued to an American customer by an American bank may be accepted by a Canadian merchant. When this happens, interchange fees vary. With an understanding of the different factors that contribute to the value of interchange and assessment fees from card brands such as Visa, MasterCard, etc., merchants are able to make informed decisions regarding their pricing and to produce more realistic estimates of their monthly costs. With that in mind, please take a moment to review the standard Interchange Rates for Canadian merchants.