It’s that time of year again! Every April and October, businesses brace for potential changes in interchange fees as Visa and Mastercard adjust their pricing structures. It seems that the cost to accept credit cards never goes down. April 2025 is no exception, with both major card networks rolling out new interchange rates and fees. While the Card Settlement Act promised some relief with a 7-basis-point reduction, the latest interchange adjustments tell a different story. How will the cost of your payment processing be affected?
For businesses that accept credit cards, understanding these updates is critical for managing payment processing costs and staying ahead of industry shifts. So, let’s break down what’s changing and what it really means for merchants.
Below we look at the biggest changes headed for Business owners and whether or not you can expect any savings from the settlement act. It is still early to say these changes are final as the card brands have not made their official announcement at the time of this writing – we will update this blog as changes are announced/confirmed.
Visa’s April 2025 Interchange Updates
Visa’s latest adjustments include both rate increases and program expansions:
- Commercial Enhanced Data Program (CEDP) – Visa is implementing the CEDP in the U.S. starting April 12, 2025. This program is designed to provide enhanced data on commercial transactions, potentially affecting interchange rates for small businesses that accept corporate or business cards. Stay tuned for the costs on this program.
- Standard Infinite Business Interchange Rate Increase – The interchange rate for the Standard Infinite Business program will rise from 2.25% to 2.35% on April 11, 2025. Businesses that process payments with high-end business credit cards will feel the impact directly. This 10 basis point increase effectively wipes out any benefit of the card brand settlement for these types of cards.
Mastercard’s April 2025 Interchange Adjustments
Mastercard is also introducing new fees that will affect the cost of payment processing:
- Reporting and Infrastructure Fee – A new fee of $0.0002 per transaction will be introduced. If you are keeping track – that is a 2 basis point increase across the board.
- Digital Enablement Fee – This new charge will be 0.02% per transaction, with a minimum of $0.02 and a cap at $0.20. This fee targets digital transactions, potentially impacting businesses that process high volumes of online payments. Again, this is a sweeping increase in costs especially for online businesses – further offsetting the benefits of the card brand settlement.
Card Settlement Act’s 7-Basis-Point Reduction: A True Savings or a Trade-Off?
The Card Settlement Act, which aimed to reduce interchange fees by 7 basis points, was a step toward lowering costs for merchants. However, Visa and Mastercard’s new adjustments suggest that the savings may be short-lived. The slight reduction in interchange rates is now being countered with increases in specific business-related transactions and additional fees.
For example, while standard debit card transactions may see a slight reduction, businesses that rely on commercial cards or online payments could see an overall increase in their payment processing costs due to the added fees.
As with the Durbin amendment, little relief in the cost of payment processing is expected from this decade long lawsuit. It seems the only ones coming out on top are the legal teams.
What This Means for Your Business
If you accept credit cards, these changes could mean the difference between saving a fraction on some transactions and paying more in other areas. Here’s what you should consider:
- Review Your Merchant Statements – Take a close look at your payment processing statements to see where costs are increasing.
- Evaluate Your Card Mix – If your business processes a high number of commercial or premium card transactions, you may feel the new interchange hikes more than others.
- Consider Alternative Payment Methods – ACH payments and debit card transactions may offer cost savings compared to premium credit cards.
- Work With a Transparent Payment Processor – Having a payment partner who can help navigate these changes and optimize your processing setup is more important than ever.
While the Card Settlement Act aimed to lower costs for merchants, the reality is that Visa and Mastercard’s interchange adjustments are offsetting those savings in other areas. This ongoing tug-of-war between regulation and fee adjustments highlights the complexity of the payment processing industry.
Merchants must stay informed and proactive. By understanding these changes and adjusting your payment strategies accordingly, you can better control costs and ensure that your business remains profitable despite shifting interchange landscapes.
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