MDR (merchant discount rate)

MDR is the main part of processing cost. At 2.5%, a payment of 100 leaves the merchant 97.5 before other fees. MDR usually bundles interchange, scheme fees and the acquirer's margin.

On top of the percentage there can be a fixed fee per transaction and fees for payouts, conversion and refunds. That is why providers are best compared by effective rate — total fees divided by volume.

The rate depends on the payment method, country, niche and volume: instant transfers are often cheaper than cards, while high-risk pricing is higher.

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