the association’s determined interchange SMSF Auditor and what determines interchange well the type of card being used the type of business may be there si si code that stands for standard industrialized code so if it’s a higher risk type scenario or a higher risk type of business that might carry
a higher interchange rate and then we see there the issuer which is the financial institution they receive interchange so let’s take a rate and what we’re going to do is we’re going to kind of peel back this onion so let’s just say this is a mid qualified rate we’re offering on a tiered level so the rate we’re going to offer our merchant is two point three nine percent and twenty cents a transaction so let’s say that is a hundred dollar action so one hundred dollars two point three nine percent a ten and twenty cents equates to two dollars and fifty nine cents so what makes up that two dollars and fifty nine says and who it’s what well the funny thing
is is when we’re out talking to merchants sometimes they don’t like us because they think we’re the ones that are taking all the money from them well really the bottom line is about seventy to eighty percent of each transaction that the merchants pay for goes to interchange so all of us out there selling to merchants we’re actually arm wrestling our competition for that last fifteen to twenty five percent so when we explain that to the merchant sometimes that’ll put them in a little bit more at ease because when you
say hey mr. mrs. merchant out of every hundred dollars you’re processing I’m really on again or sent to that and the issuing banks and associations are actually the ones getting the couple to two to three dollars so once again let’s continue to peel the onion back on that transaction so we have two dollars
and fifty nine cents this was a swiped rewards card so interchange on that rate is one point six five and a dime so that is a dollar