Interchange Updates - April 2024

Apr 22nd, 2024

Exciting Updates in the World of Interchange this Spring!

Spring is bringing a whirlwind of changes to the world of payment processing, especially with recent updates from MasterCard, Visa, and other major players. If you've been following the news, you're likely aware of the ongoing settlement between MasterCard, Visa, and a lawsuit that's been decades in the making. But what does this mean for merchants like you?

Let's dive into the details:

Good News on Interchange Rates

As part of the settlement, MasterCard and Visa have agreed to lower interchange rates and cap them for a limited time. This is fantastic news, especially for merchants operating on Interchange Plus pricing structures, such as many of Ascent's clients. These reductions in interchange fees mean direct benefits for you and your bottom line.

The Fine Print: Card Brand Fees

However, it's not all smooth sailing. While interchange rates are getting a makeover, card brand fees, including assessments, are not part of the settlement agreement. In fact, brace yourselves for some changes in this department.

MasterCard Updates

MasterCard is introducing a new fee for MO/TO (Mail Order/Telephone Order) transactions, set at 0.015%. Additionally, MasterCard assessments, which are levied on all transaction volume processed are on the rise. Expect to see increases from 0.13% to 0.14% on transactions under $1,000 and from 0.14% to 0.15% on transactions over $1,000. NABU (Network Access and Brand Usage) fees are also getting a bump, now standing at $0.0295 per item, and extending to non-domestic authorizations, including those on refund transactions. Furthermore, the Digital Enablement Fee is expanding, with an increase from $0.20/item to $0.40/item for transactions over $1000.

Discover Changes

Discover isn't sitting still either. They're upping the interchange rate for Base Submission Level AIP from 3.05% + $0.10 to 3.15% + $0.10.

American Express Adjustments

Even American Express is in on the action, increasing interchange for certain groups of merchants, such as Retail and Others.

In Conclusion

While the spring season might bring about a fresh start, it's also a time for adjustment in the world of interchange and card brand fees. Stay informed, stay proactive, and remember to adjust your strategies accordingly to navigate these changes smoothly. And as always, if you have any questions or need assistance, our team at Ascent is here to help.