Interchange rates are baseline costs established by the two bankcard associations, Visa and MasterCard, on behalf of their member banks that set the foundation costs which makeup the merchant's bank card processing fees. Additional fees may be added by the merchants acquiring bank to reach a final rate called the "discount rate".
The rate that is set and charged by the bankcard association to the acquiring banks for the credit card transaction. The interchange rate, which is actually a percentage of the transaction amount, also helps account for authorization costs, fraud and the general or average banks cost of funds.