Which factors impact interchange rates?

Interchange rates are influenced by several factors related to the specifics of the transaction and the characteristics of the card being used. The correct option highlights that the card type (debit or credit) plays a significant role in determining interchange fees. For instance, credit cards often incur higher interchange rates compared to debit cards due to the greater risk and reward associated with credit transactions. Additionally, the issuing country impacts interchange rates because different countries have varying regulations and market dynamics that influence how much issuers can charge merchants.

In essence, the card type signifies the risk involved, while the issuing country can alter fees based on local economic conditions and payment processing frameworks. This correct answer captures key elements that directly affect interchange rates, which are essential for understanding the costs associated with accepting card payments.

The other provided options include factors that might influence transaction processing in broader terms, such as operational costs for merchants or customer behavior but do not directly relate to the structural determinants of interchange fees like card type or the issuing country do.