As merchants combat high interchange fees by increasing debit penetration, the debit networks are quietly increasing their fees at the same time. Interlink is the latest debit network to announce an increase.
For tier 4 merchants, the rate goes from 75 basis points and $.17 per transaction to 95 basis points and $.20, There is no cap on the percentage fee charged. That’s $.0095 times the transaction amount plus the per item fee. Compare this to the debit interchange cost of 1.03% and $.10 per transaction and it’s obvious the numbers are getting closer.
Merchants will need to weigh cost and risk to make decisions about pushing pin debit. With pin debit, all risk is removed from the merchant for chargebacks.
New rates are effective April 16, 2010.