What Is a Blended Rate?
A blended rate is a single percentage that your payment provider charges across all transaction types regardless of whether the customer pays with a Visa credit card, Mastercard debit, or EFTPOS.
It's called "blended" because it averages out the cost of:
- Cheap transactions (EFTPOS, debit cards)
- Expensive transactions (Visa and Mastercard credit, Amex)
Why Providers Use Blended Rates
Blended rates are simple to understand and easy to price. However, they can work against businesses whose customers mostly pay with cheap cards, because you're essentially subsidising the cost of customers who pay with expensive cards.
The Alternative: Interchange-Plus Pricing
Some providers (like Tyro) offer interchange-plus pricing, where you pay the actual interchange fee set by Visa and Mastercard plus a small margin.
This can be cheaper for businesses with a good card mix but harder to predict month-to-month.
How to Calculate Your Blended Rate
- Look at your monthly merchant statement
- Find your total fees for the month
- Divide by your total revenue
- Multiply by 100
Example: $950 in fees divide by $65,000 revenue = 1.46% blended rate
Is Your Blended Rate Too High?
Here's a rough benchmark for Australian businesses:
- Under 1.0% Excellent (usually only achieved at high volume)
- 1.0% – 1.4% Good
- 1.4% – 1.7% Average
- Over 1.7% You're likely overpaying
What to Do Next
Use our free calculator to enter your monthly revenue and current rate. We'll show you how much you could save by switching to a better-suited provider.
