Pricing
Acquirer Markup
Definition
Acquirer Markup the fee charged by the acquiring bank or payment processor for their services, representing their profit margin on transactions. In IC++ pricing, this is the only negotiable component. Typically expressed as a percentage plus fixed fee (e.g., 0.2% + $0.10). Markup varies by merchant risk, volume, vertical, and competitive factors.
Related Terms
Interchange Plus Plus (IC++)
The most transparent pricing model in payments, breaking costs into three components: actual interchange (paid to issuer), scheme fees (paid to card networks), and acquirer markup (the processor's profit). Merchants see exactly what each transaction costs and can optimize accordingly. IC++ typically benefits larger merchants ($100K+/month) with diverse card mixes and becomes available at higher volumes.
Merchant Discount Rate
The total percentage fee a merchant pays for accepting card payments, encompassing interchange, scheme fees, and acquirer markup. Often shortened to MDR. In blended pricing models, this is presented as a single rate (e.g., 2.9%). In IC++ pricing, the components are itemized separately. MDR varies significantly by merchant risk profile, volume, and negotiating power.
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