I found this snippet on the breakdown of interchange fees and who gets what (in case you’re interested):
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“Here is an example of the fees associated with a typical Visa Retail transaction a merchant may process and how these fees are distributed to the various parties involved:
* If we assume a Discount Rate for a Merchant of 1.65% + $0.15 Transaction Fee, then for a $100 Visa charge the amount the Merchant would pay their Merchant Services Provider will be $1.80.
* This is divided up as follows:
o Visa and Issuing Bank split the Interchange Rate of 1.25% + $0.10, or $1.35
o Merchant Services Provider and Processor split the .40% + $0.05 mark-up, or $0.45”
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So, it looks like in a typical Visa transaction, 62.5 bps goes to the card issuer, 62.5 basis points goes to Visa (that looks high relative to your numbers, but I don’t know), and 45 bps goes to the merchant services provider and processor (I don’t know what the difference is between the two, frankly). That seems more in line with how I originally thought things broke out. But, again, I don’t know – I just found these numbers after a quick search. They could be wrong.
