Cost of Processing Card Payments
Determine How a Transaction Qualifies
- Card Type: Separate interchange categories exist for credit and debit card charges.
- Card Brand: The brand of a bankcard will impact interchange qualification. This criterion is typically associated with credit cards that yield some type of reward for the cardholder.
- Card Owner: Whether a credit or debit card is issued to an individual, business, corporation or municipal agency impacts interchange qualification.
- Processing method: Card-present and card-not-present are the terms used to generally refer to the different ways of processing a credit card transaction. Card-present interchange categories carry smaller fees than card-not-present categories.
- Card-Present: Card-present transactions are those where a merchant actually swipes a card through a terminal or by an imprinted and signed credit card draft.
- Card-Not-Present: Card-not-present transactions (CNP, MO/TO, Mail Order / Telephone Order, MOTOEC) are made where the cardholder is not physically present with the card at the time that the payment is effected. This situation is most common for internet, mail-order, or fax transactions and is a major route for credit card fraud.
- Transaction data: The information supplied with a credit card transaction impacts how it qualifies at interchange. Proper and complete transaction data is especially important for merchants that process card-not-present transactions and for those that deal with corporate and government enhanced data.
- Merchant Category Code: Specific interchange categories exist for businesses that fall under a certain merchant category code (MCC) designations.