Interchange++ (IC++) Pricing Explained
Card processing fees are kept deliberately murky. Most small businesses are on a "blended" rate, one flat percentage that quietly rolls several different costs into a single number, so you can never see what you are actually paying for.
IC++ is the opposite. It itemises every cost on your statement. It is not a cheaper price by default. It is a clearer one, and clarity is what lets you spot the only part of the fee you can actually do anything about.
This guide breaks down what IC++ pricing is, how it compares to blended, what drives the numbers, and how to tell whether yours is fair.
Not sure what your current rate really includes? Send us your statement and we will tell you what you are paying for each part. Talk to us for a free, no-obligation look.
What is IC++ (Interchange++) pricing?
IC++ stands for Interchange plus plus. The name describes the structure: the interchange fee, plus the card scheme fee, plus your processor's markup, each shown as a separate line rather than merged into one rate.
Every card payment carries those three costs whoever you process with. Blended pricing hides them inside a single percentage. IC++ exposes them, so you see exactly what each party takes.
| Cost | Who receives it | Can you negotiate it? |
|---|---|---|
| Interchange fee | The cardholder's bank (the issuer) | No, it is set by the card schemes |
| Scheme fee | Visa or Mastercard | No, it is set by the schemes |
| Acquirer markup | Your payment provider | Yes, this is the only negotiable part |
That last column is the whole reason IC++ matters. Two of the three costs are fixed for everyone. The only number that moves is your provider's markup, and you cannot challenge a markup you cannot see.
The three costs IC++ breaks out
Each component does a different job and goes to a different place. Here is what sits behind each line.
- Interchange fee. Paid to the bank that issued the customer's card. It is set by Visa and Mastercard and is the same for every provider, so no one can discount it. It is usually the biggest of the three.
- Scheme fee. Charged by Visa and Mastercard themselves for running the network. Small per transaction, also fixed, and the part that the "extra plus" in IC++ breaks out separately.
- Acquirer markup. Your provider's own margin for processing the payment. This is the part they compete on and the part you can negotiate. It is the number to focus on.
In practice, the interchange and scheme fees are pass-through costs. Your provider pays them on and keeps the markup. A good IC++ deal is simply one with a fair markup on top of those fixed costs.
IC+ vs IC++: what the extra plus adds
You will also see "IC+" (one plus). The difference is small but worth knowing.
| Model | What you see on the statement |
|---|---|
| IC+ (Interchange plus) | Interchange shown separately, with the scheme fee and markup combined into one figure |
| IC++ (Interchange plus plus) | Interchange, scheme fee and markup all shown separately |
The second plus pulls the scheme fee out of the markup. That removes the last place a margin can hide, which is why IC++ is the more transparent of the two.
IC++ vs blended pricing
Blended pricing is the default most businesses start on. One rate, say 1.4% plus 20p, applied to every transaction whatever card is used. IC++ instead charges the three real costs plus a set markup.
| Blended pricing | IC++ pricing | |
|---|---|---|
| Transparency | One rate, components hidden | Every component itemised |
| Billing | Simple, one number | More detailed statement |
| Cost on cheap (debit) cards | You pay the same high rate | You pay the low real cost plus markup |
| Who it tends to suit | Low volume, simplicity-first | Higher volume, debit-heavy, cost-focused |
The catch with blended is the third row. A debit card might carry only 0.2% interchange, but a blended rate charges you the same 1.4% on it as on an expensive rewards card. You pay for the gap.
Whether IC++ actually saves you money comes down to two things:
- Your card mix. The more debit and low-cost cards you take, the more a blended rate overcharges you, and the more IC++ helps.
- The markup. IC++ is only cheaper if the markup on top is fair. A transparent statement with a fat markup is no bargain.
What makes your interchange fee go up or down
Under IC++, the interchange portion varies transaction to transaction, which surprises people used to one flat rate. A few factors drive it.
| Factor | Lower interchange | Higher interchange |
|---|---|---|
| Card type | Consumer debit | Commercial and rewards credit |
| Regulation | UK/EU consumer cards (capped) | Commercial and non-EEA cards (uncapped) |
| How it is taken | In person (card present) | Online (card not present) |
| Where the card is from | Domestic UK card | International or cross-border card |
The detail behind that table:
- Card type. Consumer debit is cheapest, standard credit sits higher, and commercial or rewards cards are the most expensive because the issuer funds those points and perks.
- Regulation. UK and EU rules cap consumer debit at 0.2% and consumer credit at 0.3%. Business cards and cards from outside the EEA are not capped and cost more.
- Channel and origin. Online payments and international cards carry higher interchange because they carry more fraud risk.
IC++ or blended: which suits your business?
Neither model is universally better. It depends on how you trade.
| IC++ tends to fit if | Blended tends to fit if |
|---|---|
| You take meaningful card volume | You process very little |
| A lot of your payments are debit | You want one predictable number |
| You want to see and control costs | Simplicity matters more than a few basis points |
| You are growing and fees add up | Your current blended rate is already keen |
The honest version: for most businesses taking real volume, IC++ wins because you stop overpaying on cheap cards. But if you process small amounts and value one tidy figure, a competitive blended rate is perfectly sensible. Transparency is only worth switching for if it actually lowers what you pay.
Want to know which model and rate fit your card mix and volume? Speak to an adviser and we will work it through with you.
What's negotiable, and what isn't
This is the part that turns the theory into money saved. Of the three costs, two are fixed and one is not.
Interchange and scheme fees are pass-through. No provider, however large, can discount them, so anyone promising a cut on the "whole" rate is really only moving the markup. The markup is the lever, and it is the number to benchmark.
To judge your own deal, work out your effective rate: total card fees for the month divided by total card turnover. That single percentage tells you what you really pay once every component is added up, and it is the figure to compare provider to provider.
Merchant Advice is an independent broker. We do not run the processing, so we have no reason to push one model over another. We read your statement, separate the fixed costs from the markup, and tell you whether the markup is fair and where it could come down.
A worked example: a single £100 payment
Numbers make it concrete. Here is an illustrative £100 payment on a UK consumer debit card under IC++.
- Interchange: about 20p (0.2%, the regulated debit cap), paid to the customer's bank.
- Scheme fee: about 3p, paid to Visa or Mastercard.
- Acquirer markup: about 25p (an illustrative 0.25%), kept by your provider.
- Total: roughly 48p, an effective rate near 0.48% on that payment.
On a blended rate of 1.4% plus 20p, that same £100 debit payment would cost £1.60. The difference is what you were paying to keep the components hidden. The figures are illustrative and real rates vary by card and provider, but the shape holds: blended overcharges on cheap cards.
Conclusion
IC++ pricing is not a magic discount. It is transparency: the interchange fee, the scheme fee and your provider's markup, each shown for what it is.
That transparency matters because it points you at the one number you can change. Interchange and scheme fees are fixed for everyone. The markup is where a good deal is won or lost.
If you would like to know what your current statement really hides, send it over. Speak to an adviser for a free, independent review of your fees, with no obligation and nothing to sign.
