Guide
Interchange-plus vs flat-rate credit card processing
Flat-rate pricing looks simple. Interchange-plus looks complicated. For businesses with real card volume, the model you pick usually matters more than the brand on the terminal.
What flat-rate pricing actually is
Flat-rate plans charge one blended percentage (sometimes plus a fixed per-transaction fee) on every card. The processor absorbs interchange variance and keeps the difference when your mix is cheaper than the blended rate assumes.
That model is easy to sell to startups and micro-merchants. It gets expensive when your average ticket rises, your debit share is high, or your volume clears the point where wholesale pricing would undercut the blend.
What interchange-plus (cost-plus) is
Interchange-plus passes through the card network interchange and assessments, then adds a disclosed processor markup. You see the network cost and the processor margin as separate pieces instead of one opaque percentage.
Wholesale-style programs usually sit in this family. The point is not jargon. The point is auditability: you can check whether the markup matches what you were sold.
Who usually wins with which model
Flat-rate can still be fine for very low volume or highly variable card-not-present mixes where simplicity matters more than basis points. Once monthly volume is meaningful, especially with higher tickets, interchange-plus usually leaves less money on the table.
- High average tickets (healthcare, contractors, auto) often overpay on flat retail blends
- High debit share can make flat rates look cheap until you see Durbin-capped debit costs underneath
- If you cannot see interchange separately, you cannot verify the processor margin
How to decide without guessing
Do not decide from a homepage rate. Send a recent statement. We line up your effective rate against a wholesale-style schedule for your volume and card mix, typically within 48 hours.
Related reading
FAQ
Is interchange-plus always cheaper than flat rate?
Not always for tiny volume. For most businesses processing roughly $30,000 or more per month, interchange-plus with a disclosed markup is usually the cleaner and often lower all-in cost. The only honest check is your statement.
Does wholesale processing mean interchange-plus?
Wholesale-style programs are typically built on cost-plus structures with thinner disclosed markup. PFAdvance compares your current stack to that structure using your real statement.