Overview

• Merchant Discount Rate (MDR) is the amount a Merchant is charged for processing transactions.
• MDR is impacted by several cost components including Interchange or Wholesale Discount, assessments, processing, settlement and reporting fees.
• This means your MDR could include Qualified Fees, Non-Qualified Fees and Differential Fees.

Higher Merchant Discount Rate Fee Charges Inquiry

Why is this transaction considered/not considered recurring?

Criteria for a transaction to be considered as recurring:

• The card is domestic.
• The transaction is manually entered.
• The transaction attribute is R (Recurring Payment).

Recurring transaction occurs when the Customer periodically charges the Cardholders' account for recurring purchase of goods/services. A recurring transaction must not include partial payment for goods/services purchased in a single transaction.

Installment transactions occurs when partial payment is received for goods/services purchased, related to the same purchase transaction.

Why did a transaction bill under a particular fee program? Why was the transaction downgraded?

• Purchase and refund transactions on the same card may have different fee programs.
• Electronic or chip transactions may be downgraded if the batch is not closed within three days.
• There are an increasing number of premium cards from the Issuers.

Criteria for a transaction to be considered downgraded to a higher cost Interchange level:

• The card is manually entered.
• There is no auth number on the transaction.
• The original transaction was dropped and manually reprocessed.
• For the SAF (Store and Forward) Merchant, new requirements may not have been applied yet. Email to Development Help Desk.
• SCP Merchants (file formats need to be retrofitted).
• The card type is Corporate, Foreign, or Premium, e.g., points card.

Why is this transaction considered non-qualified when I do not key in my transactions?

Criteria for a transaction to be considered as qualified:

• The card is swiped or inserted through the POS.
• The transaction is authorized.
• Preauths are swiped. They are completed with a pre-auth completion upon delivery of good/services, with the original auth number.
• Batch is closed within three business days.

Criteria for a transaction to be considered non-qualified:

• The card is manually entered.
• There is no auth number on the transaction.
• The original transaction was dropped and manually reprocessed.
• For the SAF (Store and Forward) Merchant, new requirements may not have been applied yet. Email to Development Help Desk.
• SCP Merchants (file formats need to be retrofitted).
• The card type is Corporate, Foreign, or Premium, e.g., points card.

Why is this transaction considered standard when I swiped the card?

Criteria for a transaction to be considered standard:

• The card is swiped or inserted through the POS.
• The transaction is authorized.
• Preauths are swiped. They are completed with a pre-auth completion upon delivery of good/services, with the original auth number.
• Batch is closed within three business days.

Criteria for a transaction to be considered non-standard:

• The card is manually entered.
• There is no auth number on the transaction.
• The original transaction was dropped and manually reprocessed.
• For the SAF (Store and Forward) Merchant, new requirements may not have been applied yet. Email to Development Help Desk.
• SCP Merchants (file formats need to be retrofitted).
• The card type is Corporate, Foreign, or Premium, e.g., points card.

I should be receiving Industry rates. Why are these transactions being charged a higher MDR?

Criteria for a transaction to get the Industry rate:

• MCC codes are 5541 (Gas), 5542 (Gas), or 5411 (Grocery).
• The card is swiped or inserted through the POS.
• The transaction is authorized
• Pre-auths are swiped. They are completed with a pre-auth completion upon delivery of good/services, with the original auth number.
• Batch is closed within three business days.
• Key fobs are not used, i.e., Esso Speed Pass, Shell Easy Pass, etc.

I should be receiving Performance rates. Why are these transactions being charged a higher MDR?

Criteria for a transaction to get Performance rates:

• In ACI > Card Scheme, the Merchant has a 10-digit Performance indicator.
• Pre-auths are swiped. They are completed with a pre-auth completion upon delivery of good/services, with the original auth number.
• Batch is closed within 3 business days.

Batch Close Chart

• Transactions must be cleared within three days or less to avoid transactions being applied a higher MDR.
• Days are calculated excluding the purchase date, Central Processing date, and Sundays.
• Settlement holidays do not impact clearing time calculations.