Velocity Merchant Services (VMS) helps explain the 'process' behind credit card processing. We discuss interchange, risk, eCommerce vs retail stores, and the reason why processing rates vary depending on both card and business type. As a credit card services provider located outside Chicago, we'd love to answer any questions you have about our industry. Call 888-902-6227

1. A Brief Overview of Credit Card
Processing
Velocity Merchant Services

2. Credit Card Processing Confusion
• Many consumers and business owners are understandably unclear about the
system of processing credit card payments during an in-store transaction.

3. Interchange Explanation
• Who pays the interchange reimbursement fee
or “transfer fee”?
• Generally the merchant pays a fee based on the
interchange rate to a merchant bank or merchant
account provider in exchange for the increased
business that often comes with accepting credit
and debit cards. The per-transaction fee is usually
passed on through the goods and services the
consumer buys, so from this perspective the
consumer indirectly pays the fee.

4. ‘Wholesale’ Interchange Rates
• “Wholesale” interchange rates for Visa and MasterCard
cards generally run anywhere from 0.6 percent to
3.25% of the transaction.
• The exact rate at which any particular credit card
payment is processed will depend on:
• Type of business
• How the card is run (swiped, keyed-in, online)
• Type of card itself (rewards, corporate, fleet, basic)
• It is important that merchants ensure they are being
accorded an interchange category suitable to their
business size and type to prevent overpayment.

5. Example
• Butcher Shop vs e-Commerce Store
• For example, a butcher shop will be classified as a
retail store and should process most of its
transactions face-to-face, giving it an advantage
on its rates when compared to an e-commerce-
based store, where there’s a higher
probability/risk of fraudulent transactions

6. About Velocity Merchant Services
• Velocity Merchant Services has been providing
credit card services since 1998. Velocity
Merchant Services serves a wide range of
industry sectors that include
retail, restaurants, health/pharmaceutical, e-
commerce, and online storefronts.