Wanted to pass along some knowledge after recently shopping for credit card processing services.
For a bit of background, in CC processing there's the concept of "interchange rates" which is the wholesale processing rate that merchant account providers pay to Visa, MC, etc. There is a giant table of interchange rates, which vary based on the merchant's business type (merchant category code or MCC) and the type of card the purchaser is using, i.e. debit card, basic credit card, rewards card, etc. Merchant account providers typically charge merchants a flat rate (like Stripe's 2.9%) or possibly a couple tiers of rates based on card type. And they make their money on the spread between those rates and the wholesale interchange rates. Sometimes the spread can be quite large, for example, debit cards from large banks have a federally regulated wholesale rate of 0.22%.
There is another merchant account pricing model called "interchange plus" where the provider passes the wholesale rate through to the merchant, plus a processor margin typically 0.10% - 0.50%. Historically that model has only been available to high volume merchants, but there are some processor sales channels that will offer it to small merchants as well.
The semi-recent development (as of Oct 2023) is that Visa has created an especially low wholesale rate of 1.43% for "real estate" merchants (MCC 6513), and this includes both regular and rewards card types. The goal is to incentivize landlords to accept credit cards and increase Visa's transaction volume in a category where they don't see much action -- rent payments. But I'm told this MCC is also appropriate for STR / vacation rental merchants.
Long story short, signing up with a merchant account provider who offers interchange plus pricing and getting them to code your account as MCC 6513 can provide substantially better rates than typical processors.
