Insights on Credit Card Interchange Fees

The increasing use of credit cards in business-to-business (B2B) purchases is making it important for companies to become conversant in the world of merchant discount fees and interchange rates. “Credit cards are the fastest growing payment form in the B2B space,” says Scott Blakeley, Esq., a founder of Blakeley LLP, an advisory firm for U.S. and Canadian companies that focuses on creditors’ rights, commercial law, e-commerce, and bankruptcy law.

“Cards have become attractive to suppliers’ customers, given that card networks confer points and miles to the card holders, and customers get additional time to pay suppliers’ invoices because of the billing process by card issuers,” Blakeley says. “In addition, card issuers are continually contacting customers and highlighting the benefits to customers of using cards to pay their supply chains.”

However, credit cards are the most expensive payment channel, Blakeley notes.

According to the blog “Interchange Rates & Fees,” by Ben Dwyer on, interchange fees, which are established by the card brands, account for the majority of credit card processing expense. “Interchange is the money transferred from the acquiring bank to the issuing bank for each bankcard transaction. Historically, interchange has been imposed upon ...

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