What does Interchange Plus pricing involve?

Interchange Plus pricing is a model used in credit card processing that offers a transparent way to understand the fees involved in transactions. This pricing structure is characterized by a base rate, which is the interchange fee determined by the credit card networks, plus an additional markup or fixed fee charged by the payment processor.

When interpreting the answer that involves the transaction rate plus a surcharge amount, it accurately reflects the Interchange Plus model. The transaction rate consists of the interchange fee, which varies depending on the card type and transaction type, and the surcharge represents the additional amount the processor adds to that base interchange cost for their services. This fee can be a fixed amount per transaction or a percentage of the sale, depending on the agreement between the merchant and the processor.

In contrast, options that suggest a transaction rate based solely on the Interchange table or based on sales volume do not capture the full structure of the Interchange Plus model. This pricing method combines both the interchange fee and the processor's markup, providing clarity and predictable costs to merchants. Thus, option C encapsulates the essence of how Interchange Plus pricing functions.