Interchange-Plus vs Flat Rate Pricing

Card processors price in two main ways. This page explains both, with a worked example, and tells you how to compare them. It is general information, not financial advice.

Flat-rate pricing

Flat-rate providers charge one percentage plus a fixed fee on every card sale of a given type. Stripe’s pricing page, for example, lists 2.9% + 30¢ per successful domestic card transaction for online payments, and Square lists different rates for in-person, online and keyed-in payments by plan. The appeal is simplicity: you can predict the fee on any sale.

Interchange-plus pricing

Interchange is a fee set by the card network and varies by card type and how the card is used. Interchange-plus pricing passes that cost through and adds a markup, or, as Stax publishes, a subscription with “0% markup on direct-cost interchange” plus a flat fee per transaction ($0.08 card present or $0.15 card not present, on its page). Because the interchange part varies, the final cost depends on the mix of cards your customers use. Stripe’s pricing page also mentions “IC+ pricing” among its custom-pricing options.

A worked example (illustrative numbers)

Take 200 sales of $50 each in a month, $10,000 in total.

• Flat rate of 2.9% + $0.30: 200 × ($1.45 + $0.30) = $350, an effective rate of 3.5%.
• Illustrative interchange-plus: suppose the interchange averages 1.8% of each sale, the provider adds a $0.10 flat fee per sale and a $99 monthly subscription. That is $180 + $20 + $99 = $299, an effective rate of about 3.0%.

These interchange-plus figures are made up to show the arithmetic; they are not a quote and not a claim about any provider. With fewer, smaller sales the subscription and fixed fees can erase the saving, and with larger sales or lower-cost cards the saving can grow.

Which to choose

Flat rate suits businesses that value predictability and low overhead. Interchange-plus may suit higher volume or larger average sales, where you can obtain a real quote. Ask the provider for statement-based pricing, compute your effective rate under each model, and check contract and cancellation terms. Our processing fee calculator does the flat-rate side for the providers we cover.