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That isn't true. They enable the return of the interchange (from the issuing bank), they do not refund the scheme fees. In fact, you will pay more on the schem
by BillinghamJ 6y ago
That isn't true. They enable the return of the interchange (from the issuing bank), they do not refund the scheme fees.
In fact, you will pay more on the scheme fees to process a refund, as you need to send another message into the scheme's network - often charged per message or per byte etc.
Interchange is not payment scheme revenue - it is just passed through to the issuing bank.
- gamblor956 6y agoScheme fees generally don't apply to US credit card transactions... That is primarily an issue for cross-border credit or debit card transactions.
- lxgr 6y agoThat clearly can't be true, as it would mean that Visa and Mastercard would be working for free for domestic transactions. Scheme fees are much lower for domestic transactions as far as I'm aware, though.
- gamblor956 6y agoVisa and Mastercard don't use a scheme fee in the U.S. The credit card system is structured differently here than it is in the EU. Generally, Visa and Mastercard simply charge more per transaction for different cards in the US. For example, rewards cards cost merchants more, which is why many gas stations won't accept them.
- BillinghamJ 6y agoThe interchange is higher, sure, but that still goes to the issuing bank. Working with schemes still involves separate fees, as does processing and acquiring.