Interchange is the base cost of accepting a credit card. It's set by Visa and Mastercard, every processor in the country pays the exact same interchange, and it is completely non-negotiable. What is negotiable — and where every dollar of overcharge happens — is the markup your processor adds on top.
There are three main pricing models. Two of them are designed to keep you from seeing the markup. One of them shows you everything.
Flat rate (Square, Stripe)
Simple, predictable, and expensive. You pay 2.9% plus $0.30 on every transaction regardless of card type. Flat rate is great if you're doing under a few thousand dollars a month and you value simplicity over savings. Once you cross around $10,000 per month in volume, flat rate becomes one of the most expensive ways to accept cards.
Tiered pricing — the most common and most deceptive
Tiered pricing buckets every transaction into one of three categories: qualified, mid-qualified, and non-qualified. Each tier has its own markup. The qualified rate looks great in the sales pitch — usually around 1.7% — but in practice almost nothing qualifies for it. Rewards cards, corporate cards, business cards, and any keyed-in transaction get downgraded to non-qualified, where the rate can climb to 4% or 5%.
Most business owners on tiered pricing have no idea this is happening. They see the qualified rate on page one of their proposal and never read the downgrade table on page four.
Interchange plus — the transparent model
Interchange plus shows you the actual interchange cost passed straight through, plus a fixed markup that's the same on every transaction. Nothing bundled, nothing hidden. A processor-agnostic agent can negotiate that markup down because they have multiple processors competing for your account.
The math, on a real business
Take a business doing $50,000 per month in card volume. On tiered pricing with an effective rate of 3.2%, that's $1,600 per month in fees. The same business on interchange plus at a 1.9% effective rate pays $950 per month. That's $650 per month saved, $7,800 per year, just from switching pricing models. Same volume, same cards, same business — different model.
The wrong processor keeps you on tiered because tiered is more profitable for them. A processor-agnostic agent like Velora has no reason to hide any of this — we show you the real interchange numbers and the real markup so you can see exactly where every dollar goes.
See your numbers
Send your last two statements to Velora Payments at velorapayments.com/contact and we'll show you what you'd pay on interchange plus with a competitive markup. Free analysis, plain-English answer, one business hour.
Frequently asked questions
- What is interchange plus pricing?
- Interchange plus passes through the actual interchange cost set by Visa and Mastercard, then adds a fixed, transparent markup on top. It's the most transparent pricing model and almost always the cheapest for businesses doing more than a few thousand per month.
- Why is tiered pricing more expensive than interchange plus?
- Tiered pricing buckets transactions into qualified, mid-qualified, and non-qualified tiers, each with a different markup. Rewards, corporate, and keyed transactions get downgraded to non-qualified rates of 4-5%, and the bundling hides the true markup from the merchant.
See what your statement looks like through processor-agnostic eyes.
Send us your last two or three statements and we'll show you exactly where the savings are.