What Changed With Visa Interchange Fees in 2026?

On January 24, 2026, Visa increased Level 2 interchange rates for small business credit cards by 75 basis points (0.75%), effectively eliminating the pricing incentive merchants historically received for submitting Level 2 transaction data. At the same time, Visa’s new Consumer Electronic Debit Program (CEDP) Product 3 rates for small business cards increased by 65 basis points from October 2025 levels. For most merchants who process business card transactions, this means higher effective rates whether you send enhanced data or not.

What Are Visa Interchange Fees?

Interchange fees are per-transaction costs set by Visa and paid by the merchant’s acquiring bank to the cardholder’s issuing bank. They are the largest single component of your total processing cost, typically representing 70 to 90 percent of your overall processing fee. The amount you pay depends on four factors:

• Card type: Rewards, premium, and business cards carry higher interchange than standard consumer cards; a $100 transaction on a Visa Infinite business card can cost $1.98 to $2.70 in interchange alone

• Transaction environment: Card-not-present (online or phone) transactions are priced higher than card-present chip transactions

• Data submitted: Whether your processor submits Level 2, Level 3, or CEDP-verified data determines which rate tier you qualify for

• Your Merchant Category Code (MCC): Your MCC determines program eligibility across all card types

Under interchange-plus pricing, interchange is a visible pass-through line item on your statement. Under bundled or tiered pricing, these changes are absorbed invisibly into your effective rate.

What Is the Current Visa Interchange Rate for Small Business Cards?

As of January 24, 2026, Visa Level 2 interchange rates for small business cards are:

Merchants who cannot qualify for verified CEDP Product 3 data receive no cost benefit from submitting Level 2 data. Sending Level 2 data now costs 5 basis points more than sending no enhanced data at all, due to the CEDP participation fee added in April 2025 combined with the January 2026 rate increase.

For regulated debit cards, the Regulation II cap remains at 21 cents plus 0.05% per transaction, unchanged since 2011, though the August 2025 Corner Post court ruling has introduced legal uncertainty over the cap’s future.

What Is the Visa-Mastercard Interchange Settlement?

A proposed $200 billion settlement between Visa, Mastercard, and U.S. merchants is currently awaiting federal court approval as of April 2026. If approved, the agreement would lower credit card interchange fees charged to merchants and expand surcharging rights, allowing merchants to surcharge Visa and Mastercard transactions up to approximately 3% with fewer restrictions. The court is evaluating how the proposal differs from a prior settlement that was rejected. Merchants should not make operational changes in anticipation of the settlement until it is finalized.

How Do Visa Interchange Downgrades Happen?

A downgrade occurs when a transaction does not meet the requirements for a preferred rate tier and is repriced to a more expensive category. Common causes include:

• Missing or incorrect billing address data (AVS mismatch)

• Failure to settle within the required time window (typically 24 hours for card-present)

• Not submitting Level 3 line-item data for corporate or purchasing card transactions

• Failing CEDP data validation standards under the new Visa Product 3 rules

Downgrades are often invisible on bundled pricing statements. A free statement audit from IntelliPay identifies downgrade patterns and calculates the annual cost.

Frequently Asked Questions

Why did my Visa processing costs go up in early 2026?
If you process a significant volume of Visa small business cards, the January 24, 2026, interchange increase is likely the cause. Level 2 rates for small business cards rose by 75 basis points, and CEDP Product 3 rates increased by 65 basis points. Merchants on interchange-plus pricing will see these increases as separate line items. Merchants on bundled pricing will see them absorbed into a higher effective rate.

Does Visa publish its interchange fee schedule publicly?
Yes. Visa publishes the Visa USA Interchange Reimbursement Fees schedule directly. The document is updated periodically and lists rates for all card types, transaction environments, and merchant categories.

What is the difference between interchange and the processing fee I pay?
Interchange is the cost set by Visa paid to the card-issuing bank. Your total processing fee also includes the assessment fee paid to Visa (currently 0.14% for credit transactions) and your processor’s markup. Under interchange-plus pricing, all three are listed separately on your statement. Under tiered or flat-rate pricing, they are bundled into a single percentage.

What can merchants do to lower interchange costs in 2026?
The most effective actions are: switching to interchange-plus pricing so savings from lower-cost transactions pass through directly; implementing CEDP-verified data submission for corporate and purchasing cards where savings remain; routing debit card transactions through lower-cost networks using PINless debit routing; and eliminating downgrade triggers through accurate transaction data submission. A payment processing cost audit is the fastest way to identify your specific savings opportunities.

Disclaimer: Interchange fee schedules, regulatory decisions, and pending litigation referenced in this article are subject to change. For the most current Visa rate information, consult the Visa USA Interchange Reimbursement Fees schedule published directly by Visa. This content is for informational purposes only and does not constitute financial or legal advice.