Interchange downgrade
What happens when a card transaction misses the conditions for its cheapest fee category and gets billed at a higher interchange rate instead.
Visa and Mastercard maintain hundreds of interchange categories, each with requirements. The card should be dipped or tapped rather than keyed in, the address check should have been run, the sale should settle within a set number of hours of authorization and the amounts should match. Commercial cards also want Level 2 or Level 3 data. Miss one condition and the transaction drops to a worse category, sometimes a full percentage point or more in extra cost.
It is mostly an American problem, since US credit interchange is uncapped and the gaps between categories are wide. It also propped up the old tiered model of "qualified" and "non-qualified" rates, where the acquirer could classify nearly anything as the latter. Interchange++ made downgrades visible on the statement.