New MasterCard Network Fee
MasterCard has introduced the annual Acquirer License Fee (ALF). This fee is being billed to merchant services providers for their use of the MasterCard brand and the processing platform. The ALF is based on each provider’s annual MasterCard volume, including credit and signature debit volume.
How does this affect my business?
Fees like these are almost always passed along to merchants in one way or another.
- For merchants on Interchange Pass-through based pricing, this fee should appear similarly as other MasterCard assessment and network fees. Some merchants are seeing an increase of 0.015% (0.00015) or more on all MasterCard $ volume.
- For merchants on bundled pricing, service providers may use this as an opportunity to increase your rates, potentially higher than what the new fee is.
This fee is similar to the Visa Fixed Acquirer Network Fee (FANF) that was introduced earlier in 2012. The FANF is a flat monthly fee, and is based on the activity of each merchant instead of the provider. Instead of a volume assessment like the MasterCard ALF, however, the Visa FANF fluctuates on a variety of factors.
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