Interchange fee

A fee specified by card associations that is paid by the acquirer to the issuing bank for each credit or debit card transaction to cover transaction costs. The acquirer passes this fee to merchants, in addition to any other fees charged for processing credit or debit card transactions. The fee depends on a number of variables, such as card type, business type, card acceptance method, settlement or batch timeframe, information submitted with the transaction, and more. Fees usually range between 1-3%.