The 2026 Debit Strategy: Your Secret Weapon Against Rising Credit Costs

Author: Dale Erling, 15+ years payment and fintech experience | Read Time:  4 minutes | Last Updated January 2026

Nearly Every Small Business Accepts Debit—But Most Overpay

If you’re a small business owner or financial officer in 2026, accepting debit cards is table stakes—over 94% of merchants do. But following the January 24, 2026, credit card interchange jump, which hit Visa Small Business credit products with hikes of up to 75 basis points, the stakes have changed.

While credit processing has become a moving target, debit interchange remains protected by Regulation II. Are you proactively steering your business toward these lower-cost transactions, or are you leaving profit on the table?

What Every Professional Wants to Know

How do I cut debit processing costs (without losing features)?

In 2026, these five strategies are saving merchants an average of 0.5–1.5% per transaction:

• Switch to Interchange-Plus Pricing: Flat-rate pricing may seem simple, but it’s often a “hidden tax” on merchants.

• The “Debit or Credit?” Prompt: Train your team to ask, “Will that be debit or credit?” to naturally encourage lower-cost payment methods.

• Encourage PIN Entry: PIN-authenticated debit usually costs 0.2–0.4% less than signature-based debit and provides an extra layer of fraud protection.

• Mobile Wallets Count: Digital wallets like Apple Pay and Google Pay still qualify for lower debit rates if a debit card is the default wallet card.

• Eliminate PCI Non-Compliance Fees: Staying compliant with self-assessments can eliminate monthly penalties of $20–$100.

Is there more regulation coming for credit cards too?

Yes. The Credit Card Competition Act (CCCA) of 2026 is currently gaining momentum. If passed, it would require large banks to offer at least two unaffiliated networks on credit cards, providing merchants the same routing choice on credit cards that they have enjoyed on debit for years.

Why This Matters in 2026

The gap between credit and debit costs has never been wider. While the January 2026 rate hike increased overhead for rewards credit cards, debit interchange remains your “safe harbor”. By focusing on transparency and staff training, you can reclaim hundreds of dollars in monthly profit.

FAQs: Protecting Your Bottom Line

Q: Did debit card rates go up on January 24th? A: No. The January 24, 2026, increase was exclusive to Visa Small Business credit products.

Q: Can I surcharge a credit card but not a debit card? A: Yes. In fact, card brand rules prohibit surcharging on debit cards. However, by surcharging only the expensive credit tiers that just saw a rate jump, you naturally encourage customers to use their lower-cost debit cards.

Q: What is the proposed Fed cap change for debit? A: There is currently a Federal Reserve proposal to lower the debit cap further—from 21 cents down to 14.4 cents. While not yet finalized, this would make a “debit-first” strategy even more lucrative for your business.

About the Author

Dale Erling is a veteran fintech leader and payment processing strategist with over 15 years of experience. Throughout his career, Dale has helped organizations—ranging from local municipalities to large-scale enterprises—architect secure, cost-effective payment ecosystems that prioritize both user experience and bottom-line efficiency. Prior to his leadership role at IntelliPay, Dale honed his deep technical expertise at major financial institutions, including Prosper Healthcare Lending and EnerBank USA.

Disclaimer

The information provided on this page is for educational and informational purposes only and does not constitute legal, financial, or professional advice. Payment statistics, interchange rates, and fee structures are current as of January 2026 but are subject to change by card networks and individual issuing banks. Surcharge and fee-based models are subject to specific state laws and card brand regulations; always verify regional requirements and current merchant agreements before implementing new pricing models. Readers act on this information at their own risk.