Interchange Optimization

Created by Richard Moore, Modified on Fri, 22 Sep 2023 at 02:15 PM by Richard Moore

What are interchange rates?


Interchange rates are paid by Exact to the acquirer. In order for Exact to provide the best rates to its merchants it is important that merchants provide as much data as they have available when initiating a transaction.


How to optimize the interchange rate assessed on a transaction?


To qualify for lower interchange rates on credit card transactions, the transaction must contain the necessary data so that card networks and issuing banks can assess the associated risk. Accurate and complete data can help to achieve lower interchange rates. Here's the key data to include:


Cardholder Information

  • Full Name: Provide the cardholder's full name as it appears on the credit card.
  • Billing Address: Include the cardholder's billing address, including street address, city, state, and ZIP code.
  • Phone Number: Include the cardholder's contact phone number.


Transaction Information


  • Merchant Category Code (MCC): Ensure that your business is classified under the correct MCC category. Some MCCs have lower interchange rates.
  • Invoice or Order Number: If applicable, include an invoice or order number for reference.


Payment Verification Data


  • CVV/CVC/CVD Code: Request and include the Card Verification Value (CVV) or Card Verification Code (CVC) from the back of the card. This helps verify that the cardholder possesses the physical card.
  • AVS (Address Verification System): Use the AVS to confirm that the billing address provided matches the one on file with the card issuer. If there's a mismatch, you may receive a higher interchange rate.


Level 2 and Level 3 Data (Business and Corporate Cards)


  • For B2B or corporate transactions, providing additional data fields can help qualify for lower interchange rates. This includes items like tax information, order number, and more. Check the level3 object in the API spec for all of the fields. Below are some sample corporate card rates (for illustration purposes only); the rates improve when Level 2 and Level 3 data is included:
  • Level 1 – 2.70%
  • Level 2 – 2.50%
  • Level 3 – 1.90%
  • Large ticket –1.45+ $35


Ensure PCI Compliance


  • Comply with Payment Card Industry Data Security Standard (PCI DSS) requirements to safeguard cardholder data. Non-compliance can result in higher interchange rates or fines.


3-D Secure Authentication


  • The use of 3DS itself doesn't directly impact interchange rates. One of the purposes of 3DS is to reduce the risk of fraud in online transactions. By implementing 3DS, you can potentially reduce the likelihood of fraudulent transactions, which can lead to a lower incidence of chargebacks. Lower chargeback rates can positively impact your overall payment processing costs. Find out more about chargebacks, here.


Note that not all businesses will be eligible for lower interchange rates, as these rates depend on various factors including the type of card, the nature of the transaction, and the industry a merchant operates in.



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