A scheme fee is a fee that a card scheme charges issuers and acquirers for using its network and services, such as authorisation, clearing, settlement and brand licensing. Acquirers usually pass scheme fees on to merchants inside the merchant service charge. The Interchange Fee Regulation caps interchange and leaves scheme fees uncapped.
Interchange feeAn interchange fee is the fee paid for each card transaction between the acquirer (the merchant's bank) and the issuer (the cardholder's bank), usually set by the card scheme. In the EU, the Interchange Fee Regulation caps it at 0.2% of the transaction value for consumer debit cards and 0.3% for consumer credit cards in four-party schemes.
Merchant service charge (MSC)The merchant service charge (MSC) is the total fee a merchant pays its acquirer for accepting card payments, often a percentage of value plus a fixed amount per transaction. It bundles the interchange fee, scheme fees and the acquirer's own margin. Under the Interchange Fee Regulation, acquirers must show each component separately unless the merchant asks for blended pricing.
Four-party card schemeA four-party card scheme is a payment card scheme in which the cardholder's bank (issuer) and the merchant's bank (acquirer) are different firms, connected through the scheme's network and rules, so each transaction involves cardholder, issuer, acquirer and merchant. In a three-party scheme the scheme itself issues the cards and acquires the merchants.
Merchant service charge (MSC)The merchant service charge (MSC) is the total fee a merchant pays its acquirer for accepting card payments, often a percentage of value plus a fixed amount per transaction. It bundles the interchange fee, scheme fees and the acquirer's own margin. Under the Interchange Fee Regulation, acquirers must show each component separately unless the merchant asks for blended pricing.
Interchange feeAn interchange fee is the fee paid for each card transaction between the acquirer (the merchant's bank) and the issuer (the cardholder's bank), usually set by the card scheme. In the EU, the Interchange Fee Regulation caps it at 0.2% of the transaction value for consumer debit cards and 0.3% for consumer credit cards in four-party schemes.