Short answer
One fixed price for every card payment, such as 2.9% + 30¢, whatever the card type and real cost underneath.
Flat-rate pricing is simple and predictable, which is why it suits new businesses. The processor charges the same price whether the underlying interchange is 0.05% on a regulated debit card or 2.7% on a business card, and keeps the difference.
At high volume that difference adds up, because most payments cost the processor far less than the flat price. That’s why larger merchants move to interchange-plus pricing. Compare the two models in our guide to reducing card processing fees.
Part of our guide to interchange-plus pricing explained.
Related terms
- Blended pricing: Any pricing that combines interchange, network fees and markup into one or a few published rates, so the parts are not visible.
- Interchange-plus pricing: A pricing model where you pay the actual interchange and network fees on each payment, plus a fixed processor markup.
- Effective rate: Your total processing fees divided by your total card volume for the same period: the one number that makes any two pricing setups comparable.