Definitions for "Interchange Rate"
Rate set and charged by the bankcard association (i.e. Visa or Mastercard) to the acquiring banks for each transaction. The interchange rate is generally a percentage of transaction amount and helps account for authorization costs, fraud protection and the average bank's cost of funds.
a percentage of a transaction amount and the percentage is set by the bankcard association
The interchange rate is a percentage of the transaction amount. This rate is set and charged by the bankcard association to the acquiring banks for the credit card transaction. It also helps account for general or average banks cost of funds, fraud and authorization costs.