n its first large-scale realigning of interchange rates, MasterCard Worldwide's independent board of directors is wielding power to redress concerns of some of the most vocal merchants.

MasterCard will change many rates for its U.S. Consumer Credit cards. Most striking is a switch to two card types: Core Value and Enhanced Value (rewards) cards. New rates will take effect April 13.

"The Consumer Credit Enhanced Value program provides a new economic structure for meeting minimum rewards value requirements," one processor noted in an interchange bulletin issued to its ISOs in early February.

MasterCard did not respond to requests for information.

Enhanced Value hikes in June

On June 15, the Standard rate for a MasterCard Consumer Credit transaction will rise from 2.75% plus $0.10 to 2.95% plus $0.10.

The difference between core and enhanced values is evident in the following categories, in which Core Value will drop from the current rate on April 13, but Enhanced Value cards will take a sometimes steep hike on June 15. All these rates will carry a $0.10 fee per transaction.

· Full Universal Cardholder Authentication Field (UCAF): Core Value will drop from 1.74% to 1.68%; Enhanced Value will rise to 1.83%.

· Key-Entered and Merit I: Core Value will drop from 1.95% to 1.89%; Enhanced Value will rise to 2.04%.

· Merchant UCAF and Merit 3 - Base: Core Value will fall from 1.64% to $1.58%; Enhanced Value will climb to 1.73%.

· Passenger Transport: Core Value will drop from 1.83% to 1.75%; Enhanced Value will rise to 1.90%.

· Travel Premier Service: Core Value will drop from 1.74% to 1.58%; Enhanced Value will rise to 1.90%.

On April 13, rates in the following three MasterCard Consumer Credit categories will drop. Come June 15, they will remain at these rates.

· Merit 3 - Tier 3 will decline from 1.58% plus $0.10 to 1.55% plus $0.10.

· Warehouse Base will fall from 1.48% plus $0.05 to 1.10%, with no flat fee per transaction.

· Warehouse - Tier 1 will drop from 1.27% to .90%.

World Elite rate increases

In April, MasterCard World credit card rates will remain flat or, in some cases, drop by up to three basis points. The World Restaurant rate will be an exception. It will increase from 1.64% plus $0.10 to 1.73% plus $0.10.

World Elite cards will show the biggest rate increases in the following categories:

• Standard
• Full UCAF
• Key-Entered
• Merchant UCAF
• Merit 1 and Merit 3 - Base
• Supermarket - Base
• T&E, which is rising 45 basis points.

The company is also creating a T&E Large-Ticket category.

4 new Commercial cards

In April, MasterCard will introduce several new U.S. Commercial credit card types: Corporate World, Corporate World Elite, Business World and Business World Elite.

Commercial, Corporate World and Corporate World Elite rates will remain largely unchanged from the current fees. However, MasterCard will introduce two new Large Ticket categories for all five cards.

The new Business World and Business World Elite card rates will all be 0.15% higher than the Commercial, Corporate World and Corporate World Elite card rates.

Petroleum windfall

Gas stations will enjoy the most beneficial changes. Since the dramatic rise in gas prices two years ago, gas station owners have been calling for a reduction in interchange rates.

Come April 13, MasterCard will cap its charges on individual petroleum sales.

The U.S. Consumer Credit Petroleum rates (Core and Enhanced) will be 1.90% with no flat fee per transaction. The Petroleum rate for World and World Elite cards will be 2%. The maximum charge per transaction on all MasterCard-branded cards will be $0.95.

The cap will benefit merchants on an interchange pass-through pricing model, according to Chad Lowrey of Chase Paymentech Solutions LLC. Petroleum merchants on a three-tiered pricing model will not benefit from the cap unless their ISOs pass that on. Many station operators are still on the three-tiered model, he added.

Dee Karawadra, Chief Executive Officer of Impact PaySystem, estimated 80% of the company's petroleum merchants are now on pass-through pricing. He said with tiered-pricing merchants, ISOs can potentially earn quite a bit from the change.

MasterCard U.S. Consumer Debit Petroleum rates will remain at 0.70% plus $0.17, but will operate on the $0.95 cap.

MasterCard publishes all its rates online at www.mastercard.com/us/merchant/how_works/interchange_rates.html.