Credit card processing fees can cut into your hard-earned revenue. While there’s no way to avoid them entirely, there are several ways to make them a more manageable cost of doing business. Large ticket interchange programs, for instance, can reduce processing costs for B2B merchants that deal with high-dollar credit and debit card transactions.
What are Large Ticket Interchange Rates?
Large ticket interchange rates are special processing rates set directly by the credit card brands (Visa, American Express, Discover, and Mastercard). Visa, for example, has a Large Purchase Advantage Fee program with different fee structures for card-present and card-not-present transactions, as well as a Commercial Product Large Ticket program and a GSA (Government Services Agency) Large Ticket program.
What Qualifies as a Large Ticket Transaction?
Each credit card brand sets its own threshold for large-ticket transactions. Discover’s is the lowest at $5,000; Visa’s is $8,000; Mastercard is $10,000.
At present, only B2B transactions that are made with a Corporate Purchasing Card can qualify for these rates. High-dollar B2C transactions, including those for cars or expensive consumer items, do not qualify for these reduced rates. Additionally, merchants must make sure to pass all the correct pieces of data to their acquirer when they settle to qualify for large-ticket interchange rates.
Do Merchants Need to Qualify for Large Ticket Interchange Programs?
There is no formal application process for large-ticket interchange programs. For Visa and Mastercard, any transaction that meets the correct criteria will process at the corresponding rate. For American Express, merchants who process more than $1 million per year in AMEX transactions do need to set up a designated account with the American Express ESA program, but merchants with a lower volume of AMEX transactions do not need to have a direct account.
How Much Can Merchants Save on Large Ticket Credit Card Processing?
Each brand updates their large ticket interchange rates several times per year. However, many large-ticket interchange fees are between 1.2 and 1.5 percent – a considerable savings from the standard processing rate of 3 percent or more.
Assuming a 3.5% fee, a $10,000 purchase would ordinarily cost a merchant $350 to process. Under the reduced rate program, however, that merchant could pay just $120 to $150 percent – a considerable savings that can add up over time.
Discover More Cost-Effective Credit Card Processing Options from Curbstone
At Curbstone, we’re here to help you qualify for the lowest possible processing rates. We’ll help you structure your transactions in a way that qualifies for the lowest fees while avoiding unnecessary downgrades, helping you keep more of your hard-earned revenue.
To have one of our team members review your most recent merchant statement for potential savings opportunities, contact us today.
