New Consumer Credit Merchant Segment Incentive Interchange Rates Introduced
- Visa will introduce new, segment-specific interchange rate for Insurance, Services, Education, Healthcare, Real Estate, and Advertising. The Retail 2 Program is being eliminated.
- Visa will eliminate the Business-to-Business interchange rate on Visa Signature Preferred and Infinite (Spend Qualified)
- For Services, Education, Healthcare, and Real Estate transactions, the newly created segment interchange rates will have a ticket size qualification—that is, the incentive interchange rate will only be available to transactions equal to or above $100 for Services and equal to or above $500 for Education, Healthcare, and Real Estate. Ticket-size qualification is structured to provide incremental benefit to higher-ticket transactions in these segments. Transactions below the qualifying ticket size are eligible for the Product 1 and Product 2 interchange rates described later in this document.
Transactions qualifying for Automated Fuel Dispensers (AFD), Service Station, Utility, Charities and Religious Organizations and Government interchange rates remain unchanged, as shown in the table below:
Consumer CNP Interchange Rates Modified
Visa will rename and modify the interchange rates for card-not-present CPS qualified transactions into unique interchange rates by consumer credit products. CNP CPS-qualified transactions will be referred to as “Product 1,” as shown in the table below. These interchange rates will apply to transactions that are not eligible for one of the segment-based interchange rates above. Account Funding transactions are not eligible for segment-based rates; Product 1 rates will apply when CPS-qualified.
Based on market dynamics, Visa is replacing all CPS qualified e-commerce and CNP interchange rates with the interchange rates above. There are no changes to the fraud liability shift available to e-commerce merchants who use 3-D Secure.
Key-entry Interchange Programs Eliminated for Visa Signature Preferred, Small Business and Large Middle Market
CPS qualified key-entry transactions will no longer qualify for card-present interchange rates on the Signature Preferred, Small Business, and Large Middle Market (LMM) products. This approach supports EMV® and chip technology as the preferred Point-of-Sale Entry mode standard, with magnetic stripe instead of key entry as the fallback method.
Modification to CPS-Qualified Recurring Program
For consistency, Visa is extending the CPS / Recurring Program to Visa Signature Preferred transactions effective CPD 17 October 2020, which will have its own unique interchange rate of 2.20%+$0.05, as shown in the table below. The existing CPS / Recurring interchange rate for the other consumer credit products remains unchanged.
Consumer Card-Present Interchange Rates Modified
Visa will rename and modify the interchange rate for CPS-qualified, card-present transactions across all consumer credit products. CPS-qualified, card-present transactions will be referred to as “Product 2,” transactions, as shown in the table below. These interchange rates will apply to transactions that are not eligible for one of the segment-based interchange rates above.
Retail Credit Performance Threshold Interchange Rates Updated
Visa is creating specific Retail Credit tier interchange rates for Visa Signature and Visa Signature Preferred transactions effective CPD 17 October 2020. The current performance threshold criteria will remain in place and any adjustments necessary will be determined after the annual year-end review. Existing tier interchange rates for Visa Traditional and Visa Traditional Rewards will also be modified, as detailed in the table below.
Small Ticket Qualifying Merchant Categories Refined, Small Ticket Interchange Rate Created for Visa Signature Preferred
In order to reflect changing merchant segment dynamics, effective CPD 17 October 2020, Visa will update the list of Small Ticket eligible merchant categories. Additionally, for consistency, Visa will extend the Small Ticket program qualification to Visa Signature Preferred transactions.
Effective CPD 17 October 2020, only transactions from the following 16 MCCs in the table below will be eligible for the Small Ticket interchange rates:
The Small Ticket interchange rates for these 16 merchant categories will be modified as detailed below:
Service stations and government transactions from the merchant categories listed below will remain eligible for the Small Ticket program at their existing interchange rates of 1.65%+$0.04 for Visa Traditional, Visa Traditional Rewards, and Visa Signature. The small ticket interchange rate for the MCCs below will not be available on Visa Signature Preferred or Infinite (spend qualified) products.
Qualifying MCCs include:
- MCC 5541—Service Stations (with or without Ancillary Services)
- MCC 9211—Court Costs, Including Alimony and Child Support
- MCC 9222—Fines
- MCC 9311—Tax Payments
- MCC 9399—Government Services (Not Elsewhere Classified)
All other merchant categories will no longer qualify for the Small Ticket interchange rate, and will default to the Product interchange rates previously described above, regardless of ticket size.