What is Acquirer markup?

The acquirer's own fee added on top of interchange and scheme fees, usually quoted in basis points plus a per-transaction cash amount.

The Acquirer Markup represents the acquiring bank's component of the overall merchant service charge, levied in addition to the interchange fees and scheme fees.

This markup is typically a combination of a percentage calculated on the transaction value, expressed in basis points (e. g. , 10 basis points equates to 0.10%), and a fixed per-transaction fee (e. g. , £0.05).

Unlike interchange fees, which are set by the card schemes and paid to the issuing bank, or scheme fees, which are paid to the card schemes themselves, the Acquirer Markup is entirely retained by the acquiring bank for its services in processing and settling transactions.

For a merchant, the Acquirer Markup is a direct cost of payment processing that they negotiate with their acquiring bank and it is detailed within their processing agreement.

Merchants typically observe this component as a line item on their periodic processing statements, alongside the aggregated interchange and scheme fees.

A common pitfall is failing to account for the fixed per-transaction element of the Acquirer Markup, which can disproportionately impact profitability on low-value transactions, even if the percentage markup seems competitive.

Acquirer Markup differs from interchange-plus pricing in that interchange-plus is a pricing *model* where interchange and scheme fees are passed through at cost, with the Acquirer Markup being the transparently added component.