Merchant discount rate,
Definition of Merchant discount rate:
The merchant discount rate is a fee that merchants must consider when managing the overall costs of their business. Local merchants and e-commerce merchants will typically have varying fees and service level agreements. Most merchants can expect to pay a 1% to 3% fee for payment processing of each transaction. Payment processors have well-established infrastructures and fee schedule arrangements in place to support all types of merchant payments.
A charge to a merchant by a bank for accepting payment from their customers in credit and debit cards every time a card gets swiped in their stores. The bank may decrease the rate as the merchants sales increase. In 2011 Congress had been asked to set a ceiling on bank charges to merchants.
The merchant discount rate is the rate charged to a merchant for payment processing services on debit and credit card transactions. The merchant must set up this service and agree to the rate before accepting debit and credit cards as payment.
How to use Merchant discount rate in a sentence?
- The merchant discount rate is charged to merchants for processing debit and credit card transactions.
- To accept debit and credit cards, merchants must set up this service and agree to the rate.
- The merchant discount rate is a fee, typically between 1%-3%, that merchants must consider when managing business costs.
Meaning of Merchant discount rate & Merchant discount rate Definition