Visa along with MasterCard, American Express and Discover, plan on making changes to their swipe fees in July, 2020. New rates will favor some businesses and others can expect a spike in their monthly credit card processing fees – especially ecommerce.
What exactly does this mean?
Swipe fees are also known as interchange – the rate Visa and the card-issuing banks charge for credit card transactions. The four major credit card companies will increase interchange for some industries and lower it for others.
E-commerce and phone-order transactions will be impacted the most.
According to Bloomberg, interchange for a $100 online purchase using a traditional Visa card will jump from $1.90 to $1.99. Fees for the same transaction but using a Premium credit card will increase by 10 cents. However, a $50 transaction at a grocery store will drop 33%, from $1.15 to $0.77. Card-present transactions will most likely see a dramatic drop in interchnage.
Corporate, purchasing and business card rates are also expected to increase. B2B companies could see a spike as much as 1%. The good news for B2B companies is the opportunity to mitigate new swipe fees with level 2/3 data.
Review your credit card processing statements every month to keep tabs on price differences. Although it is impossible to negotiate interchange rates, there are steps you can take with your processor to lower your overall effective rate.