The interchange fee, also called the discount rate or swipe fee, is the sum paid by merchants to the credit card processor as a fee for accepting credit cards. These rates are predetermined based on the risk category and services provided by each credit card being used. Seems simple, right? Not hardly, there are over 6,000 rates in the U.S. alone!
SparrowOne created a proprietary rules-based engine that reviews each transaction before it is processed. The review may indicate missing or incomplete data that will result in a higher fee on a transaction. These missing fields may be things like a shipping address, order number or transaction ID resulting in a 20 to 50 basis point increase in rate. SparrowOne’s engine steps in and optimizes the data for the transaction resulting in a lower cost.
Features of SparrowOne’s Interchange Optimization
- Collects and formats all essential data fields for each transaction
- Improves recurring transaction rates
- Uses any historical payment data to optimize the transaction data
- Prevents the increase or “downgrade” of the transaction in real-time
- Interchange optimization delivers reduced transaction costs and improve profitability automatically as orders are processed.