Interchange fee

An interchange fee is the amount the merchant’s bank pays the customer’s card-issuing bank each time a card is used — set by the card networks and passed through as part of the cost of accepting cards.

How it works

• On a card payment, the acquirer (merchant’s bank) owes the issuer (customer’s bank) a set fee.
• The rate depends on card type, region and how the payment was made — a premium rewards card costs more than a basic debit card.
• That fee is folded into the total the merchant pays its processor.

Interchange isn’t the processor’s own margin: it’s a wholesale cost the processor collects and passes on, before adding its own markup on top.

Why it matters

Interchange is usually the biggest part of a merchant’s card-processing bill, and because it’s bundled into a blended rate, most businesses never see it broken out. Card mix matters more than people expect — a customer base that pays with premium cards quietly costs more at settlement. Understanding it is the difference between negotiating fees and just paying them.

How Fynex does it

Fynex runs the whole money chain in one place and keeps more of it inside the business — routing payouts to the cheapest rail by least-cost routing so cost isn’t left on the table. As an FCA-authorised e-money institution and PCI DSS Level 1 provider, it can act as Merchant of Record. See payouts.