Find out what interchange is and the value it delivers
Interchange is a small fee paid by a merchant's bank (acquirer) to a cardholder's bank (issuer) to compensate the issuer for the value and benefits that merchants receive when they accept electronic payments. It enables banks that issue electronic payments to deliver tremendous value to merchants, governments and consumers.
The benefits that interchange delivers to all parties
Consumers derive significant value from electronic payments including convenience and safety when they make a purchase, increased opportunity for financial inclusion, access to rewards or incentives and the choice of thousands of debit, credit and prepaid payment products.
Merchants benefit from guaranteed payment; increased sales; fraud protection; lower processing costs than those associated with other forms of payment such as checks and cash; and the ability to attract and retain customers with a fast, efficient buying experience.
By receiving interchange fees from the merchant’s bank, issuers are able to bear the risks and costs associated with extending electronic payments to their customers.
Governments experience significant efficiencies and promote financial inclusion for their citizens when they choose to distribute social benefits and other programs via electronic payments.
Electronic payments are often the point of entry for new consumers to a formal financial ecosystem. By incentivizing issuers to create innovative payment programs, interchange helps encourage financial inclusion for consumers who could not otherwise participate.