Understanding Interchange

Understand interchange rates work, and how cards qualify for specific rates. Visa and MasterCard have special programs for certain merchant types and Dharma will help you find the best possible rates. Click through to learn more and educate yourself!

Visa Charity Rates

Visa has a special rate category specifically designed for nonprofits. Not all nonprofits will qualify – but if you’re classified with the MCC of 8398, or as a “Charity or Social Service” organization, then you’ll qualify for far-reduced interchange rates.

Visa Hotel & Car Rental

Hotels, Lodging merchants, and auto-rental merchants have special interchange rates from Visa. Because these merchants often take “extended authorizations” where transactions may be altered later on, there are different requirements. Visa allows for a longer authorization timeframe for these merchant types, but you’re required to submit additional information to take advantage of these rates.

Visa Utility

Visa has incredibly low interchange rates for merchants who are classified as a Utility. As these payments are considered “low risk” from a processing perspective, the interchange rates reflect that. You’ll see that many of the rates have no percentage fee, and just a flat, per-transaction fee.

Visa Emerging Markets

Since not all industries accept credit cards, Visa tries to incentivize “newer” industries with lower, more advantageous interchange rates. These are called Emerging Market interchange rates. The only qualifying business types are Schools, Government Offices, Insurance-sales, Fuel Dealers, Child Care Services, and Direct Marketing Subscription services. Charities and Telecommunication merchants are eligible for debit rates only.

Visa Small Ticket

Almost all merchants are eligible for the Visa CPS Small Ticket program. Click through for the full qualifications – but typically, if you accept a sale that’s under $15, it will qualify for lower interchange rates from Visa.

Visa Card-Not-Present Rates

The “Card-Not-Present” category is for key-entry Visa sales that meet CPS criteria (including AVS, keying on time, etc). Barring a few exceptions, most merchants are able to receive these interchange rates, and they’ll apply for most key-entry sales.

Visa Supermarket Rates

Supermarkets and grocery stores get heavily discounted interchange rates, since these types of sales are rarely disputed by cardholders. See the full qualification requirements for CPS Supermarket rates, and what other card types supermarkets/groceries can expect to see.

Visa Restaurant Rates

Visa CPS Restaurant rates are only available to restaurants and quick-serve fast food merchants. Restaurant rates are slightly higher than their retail counterparts. Click through to see what card rates restaurants can expect to see, and what potential downgrades will look like.

MasterCard Utility

MasterCard has incredibly low interchange rates for merchants who are classified as a Utility. As these payments are considered “low risk” from a processing perspective, the interchange rates reflect that. You’ll see that many of the rates have no percentage fee, and just a flat, per-transaction fee.

MasterCard Standard

Standard rates are the worst rates that you can receive on MasterCard transactions. Typically, you’ll receive Standard rates when your sales don’t meet any of the basic qualifications. This can include not submitting AVS data, not settling your sales on time, or failing to submit otherwise required data, based on your merchant type. You want to avoid this rate classification at all costs!