The card associations assign the interchange rate, which can fluctuate based on:
- the type of transaction processed
- the type of card used
- the type of merchant processing the payment
- the geographical region of the issuer
The interchange rate is usually a flat fee plus a percentage of the total transaction amount. Of all the processing fees paid, the interchange fee is usually the most expensive, sometimes comprising 70-90% of all the costs associated with a transaction.
The interchange fee is not refunded in cases of a merchandise return or a chargeback.