Credit Card Processing

Enhanced Merit 3


March 26, 2018

Enhanced Merit 3 is a MasterCard interchange category.

Enhanced Merit 3 is a MasterCard interchange category. Interchange fees are essentially the wholesale cost of credit card processing and generate income for banks that issue credit and debit cards.

The word “Enhanced” refers to the type of credit card, and “Merit 3” refers to how the card is accepted and processed. The Enhanced MasterCard card category refers to base consumer rewards cards, and Merit 3 means the transaction takes place in a card-present environment.

Qualification Details
A transaction must meet the following criteria to be qualified as Enhanced Merit 3:

  • The card must be swiped, and complete magnetic stripe data must be transmitted with the authorization request
  • Authorization must be settled within one day
  • Settlement amount must be within 10% of authorization amount, except for beauty salons which are allowed 25% tolerance, and travel and entertainment business are exempt from tolerance altogether.
  • Credit and Debit cards issued within the United States

Rate & Fee
The rate for a MasterCard transaction that qualifies as Enhanced Merit 3 is 1.73% of volume plus a $0.10 transaction fee. For example, the charge for a $100 transaction would be $1.83 ($100 * 0.0173 + $0.10 = $1.83).

Statement Abbreviations
Credit card processors refer to Enhanced Merit 3 transactions differently on processing statements. Common abbreviations for this type of transaction are: MCEC, MC ENH MERIT III, ENH MER 3, ENH MERIT III

Ben Dwyer

BY Ben Dwyer

Ben Dwyer began his career in the processing industry in 2003 on the sales floor for a Connecticut‐based processor. As he learned more about the inner‐workings of the industry, rampant unethical practices, and lack of assistance available to businesses, he cut ties with his employer and started a blog where he could post accurate information about credit card processing.As the blog gained in popularity, Ben began directly assisting merchants in their search for a processor. Ben believes in empowering businesses by providing access to fair, competitive pricing, accurate information, and continued support. His dedication to transparency and education has made CardFellow a staunch small business advocate in the credit card processing industry.


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