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Chapter 12 - Issuing and Acquiring Banks

Interchange. When I first entered the bank card space I was asked a million times ‘What’s your rate?’. Today the same questions are asked by a merchant base completely in the dark as to how fees are assessed.  Which brings us back to interchange - the core fees which constitute the majority of the fee assessed to the merchant.


Everyone uses plastic to make purchases. However it may surprise you to know current credit card processing can trace its roots back thousands of years. Did cave men use credit cards? From the fields of the gold rush to the company store, our journey ends in the banking structure of today.


There are only two types of people in the processing word. Those who use credit cards and those who accept them. Many times one person can be both! We will take a look at the needs, concerns and issues of each, and see how one influences the other.


Our final topic of conversation is in introduction to how payment cards are processed. We will track the dollars from consumer to merchant, and demystify the process. Thus armed, you will better understand the value which you will bring to the merchant, from both a financial and service perspective.

iProcess - Knowing the Payment Industry

Section 5 - Working with Interchange

You are what you repeatedly do. Excellence is not an event - it is a habit
- Aristotle

Now that you understand how a transaction works, the next step of the iProcess is to look at the ‘foundational’ charges in the world of payment processing.
As such, one of the most confusing concepts to deal with for new agents is how to make sense of the fees charged to merchants, in particular rates and transaction fees. ‘What is your rate’ is a constant thing you will hear when you get into the field.

Early in your career their will come a point in time where you will have an opportunity to prove a financial advantage, and a key tool in your arsenal is providing a side by side comparison between the fees charged by your prospects current processor and the fees you will charge.

What is interchange?

Interchange (fee) is a term used in the payment card industry to describe a fee paid between banks for the acceptance of card based transactions

When funds are transferred between banks, a fee is assessed. Interchange is the name of this fee.

Banks that issue cards to consumers are...

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iProcess - Sell Payment Processing Like a Pro!