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Interchange and Card Brand Updates: October 2023

ChargebacksPayment ProcessingInterchangeFraud Prevention

It's that time of year again, and the major card brands are rolling out updates to their interchange rates and card association fees. These changes traditionally take place in October and April of each year.

Interchange Updates

  • A fee of 0.002% will be assessed on Estimated and Incremental Authorizations by Visa. This change will particularly impact Card-Not-Present (CNP) merchants.
  • A new Digital Commerce Services Fee of 0.0075% has been introduced by Visa, affecting all card-not-present settled transactions.
  • Visa has updated Fee Descriptors and Rates for card interchange in the Infinite and Small Merchant categories, which will have implications for most clients.

Excessive Declines Fees

For merchants that accept cards, it's crucial to adhere to best practices, including limiting authorization attempts on the same card in a single day, especially if the issuer declines the first attempt. Both Visa and MasterCard impose additional fees when authorization re-attempts exceed their defined limits.

  • MasterCard applies a $0.30/item fee for each authorization attempt after 10 previously declined attempts on the same card within a 24-hour period.
  • Visa enforces a $0.10/item fee for domestic authorizations after 15 reattempts in a 30-day period for transactions that decline.

Chargeback Rule Updates

Visa Reason 10.4: Fraud Card Absent Environment
  • As of October 14, 2023, a Pre-Arbitration dispute will not be allowed when the acquirer approved a transaction after receiving an AVS result code of U (unless the transaction was attempted with a Visa Commercial Card or a card type where the cardholder is anonymous).
  • Additionally, if escalating Pre-Arbitration disputes for this reason code, the merchant will be required to supply a detailed description of the merchandise or services purchased for both the disputed transactions and the two previous undisputed transactions. Read more about Compelling Evidence that can assist you in combating Friendly Fraud chargebacks.
Visa Reason 13.1: Merchandise / Services Not Received
  • As of October 14, 2023, Visa is updating the dispute rights rule to clarify that the cardholder (or traveler) should attempt to obtain reimbursement from the bonding authority/insurance scheme prior to disputing a charge on their card.
  • In addition, if they do not receive a response or acknowledgement of the request for a reimbursement within 60 days from the relevant insurance scheme, the issuer can pursue the dispute.


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