Tiered and Interchange pricing structures are the two most traditional ways to be set up.
Tiered pricing is a fee structure that breaks down the fees into 3 different tiers (qualified, mid-qualified, and non-qualified). This is a straightforward fee structure that is easy for businesses to understand. Interchange Plus is a fee structure that breaks down the interchange fees (over 300), network, and processor fees. This fee structure is generally more cost-effective than tiered, but more complicated to understand for businesses.
Flat Rate is just that. It is a single rate designed to cover every transaction that is taken. This fee structure is typically used by mobile businesses that are continually evolving.
On June 29, 2011, the Federal Reserve ruled on the Durbin Amendment, in the Dodd-Frank Wall Street Reform and Consumer Act, allowing businesses to legally offer a discount for cash or check paying customers. This Program is available in all 50 states. With Cash Discount programs, a small fee is added to each transaction to cover the processing costs. You pay only one small monthly fee for the service. These programs are ideal for businesses that just don’t want to pay for credit card processing. Businesses only pay a set monthly fee in lieu of traditional processing fees. This is one of the fastest growing programs because it allows businesses to lower their processing fee and use the savings to grow their business.
Interchange Optimization is ideal for businesses that have business-to-business (B2B) or Business-to-government (B2G) payments. Our sophisticated technology gathers Level II and Level III data for you, avoiding industry downgrades and saving you more. Once approved for this program a business simply processes credit cards as they would normally do. Then, the network automatically initiates the optimization for lower interchange rates.