What is Credit Card Interchange?
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The process in which an acquirer or Acquiring Bank submits approved card Transactions on behalf of its Merchants.
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How Does Credit Card Interchange Work?
Interchange refers to the clearing and Settlement of records between payment system participants. The term can also be used to describe the fees — or transfer pricing — between Issuers and Acquirers. Participating Acquirers and Issuers pay or receive interchange each time a credit or debit card is used. For example, banks pay interchange for the fees associated with card-based transactions. This fee tends to be paid by the Acquiring Bank, or the merchant’s bank, to the consumer’s banks, or the Issuing Bank.