Elements of a Tiered Credit Card Processing Fee Structure

Understanding the fees associated with your business’s credit card transactions can be a challenge—especially if you accept a variety of different cards for purchases. A tiered fee structure offered by many card processors can help make it easier to identify the charges for your transactions. 

Here's What to Know About a Tiered Fee Structure:

  • Each transaction is subject to an “interchange fee.” These are wholesale transactional fees, charged by the card-issuing bank 1. The fees are expressed as a percentage of each transaction.

  • There may be dozens of different interchange fees for the cards you accept. Fees may depend on the type of credit card that’s used in the transaction (e.g., a debit or a rewards card), the type of transaction (e.g., a keyed-in number or a swipe transaction), or where the transaction takes place (e.g., online or POS).

  • In a tiered, or “bundled,” structure, the credit card processor groups the fees into rate tiers to simplify the number of possible interchange fees you’ll have to deal with.
  • On your statement, tiered fees are easier to identify. Your processor may identify transaction fees as “qualified,” “mid-qualified,” or “non-qualified.” You also might recognize a tier by its consistent rates.

Since the features and structure of a tiered program can vary widely, contact your vendor representative to learn more about the specifics of your program.


1 The issuing bank issues the credit card to the consumer on behalf of the credit card network. The issuing bank also may be referred to as the credit card company.

Posted by:
Tracy Schmidt

Published in:
Credit Card Processing

Dated posted:
Apr . 26, 2016

Blog Categories:
Credit Card Processing
Equipment Loans
MilesAway Mastercard
See all posts



Information provided in the Posts & Articles section of the Professional Solutions Financial Services website is designed to educate healthcare professionals and other small business owners and provide tips related to money, credit and financing. Contributors are sharing their expertise and experiences. This does not constitute advice or endorsements by Professional Solutions.