Visa’s new processing approach for fuel transactions is expected to enable consumers to buy gas more easily and allow motorists and station owners to better avoid the risks and inconveniences associated with pump limits and holds on funds. Visa also will reduce interchange rates for fuel transactions, which can lower costs for oil companies and service stations and can be passed onto consumers at the pump.
Visa is restructuring consumer interchange for transactions at automated fuel dispensers and service stations in the US, effectively lowering interchange rates. Interchange for consumer debit cards including Visa check card and Visa prepaid, will be capped at $0.95 per transaction. This change will become effective July 18, 2008.
Credit interchange applied to fuel transactions has been restructured into a single, lower rate across all consumer credit card transactions. This adjustment will take effect system-wide for all fuel transactions in October 2008. In the meantime, Visa will work with fuel merchants and their acquirers individually to process credit transactions at these lower rates, ahead of October 2008.
Visa is also implementing Real-Time Clearing (RTC) in fall 2008, which reportedly represents a fundamental change and significant improvement in how fuel transactions are processed. With this implementation, transactions will be processed immediately instead of at the end of the day. This can reportedly reduce the hold times that financial institutions place on cardholders’ accounts.
Until the new processing changes are implemented in the October 2008 systems upgrade, Visa is allowing consumer fuel transactions up to $125 to qualify for its best-available interchange rates. This interim step is effective July 18, 2008, and will remain in place through October 2009. Once gas stations and their financial institutions migrate to Real-Time Clearing, consumer fuel transactions up to $500 can qualify for Visa’s best available interchange rates.
