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Benefits of Level 3 Payment Processing

If you regularly receive credit card payments from other businesses, you need to consider the substantial benefits that Level 3 payment processing offers.

What is Level 3 Processing?

In the simplest of terms, Level 3 payment processing is additional line-item detail (item descriptions, quantities, tax detail, etc.) that Visa and MasterCard like to receive on business credit card transactions along with the required standard transaction info (card #, exp. date, zip code.).

In return for providing this additional transaction detail, both card brands offer significantly lower (.50% to 1.50% lower) interchange rates on eligible commercial card transactions.

Why Do Visa & MasterCard Offer These Lower Rates?

The additional Level 3 data offers significant value to larger business card holders. This additional transaction data when reported back to card-holding company allows businesses to monitor and track purchases closely and even set restrictions on purchases made with the company credit card.

Level 3 data also helps businesses to minimize inappropriate spending by seeing where their money is going, what is being spent, and how much is being spent. This more significant control allows businesses to reduce wasteful expenditures and improve business operations.

Visa & MasterCard can provide this valuable spending data to businesses and charge them higher than average credit card interests rates. Participating companies are willing to pay the higher interest rates on their credit cards because of the valuable transaction data they receive in return. So it ends up being a win-win for all the parties involved.

What Transactions Are Eligible For The Level 3 Rates?

Only commercial card types are eligible for Level 3 interchange rates. So if you sell mostly to consumers (as opposed to businesses), you are not going to receive the more favorable Level 3 rates. Most MasterCard Business, Commercial & Purchasing card-types are eligible for Level 3, but with Visa only Purchasing cards are eligible for Level 3 rates.

To view the current Level 3 interchange rates, visit our B2B Merchant Account page on our website.

Eligibility does not necessarily mean you will receive these lower rates. You must submit your transaction and Level 3 data using a Level 3 supported payment gateway or Level 3 supported software. You cannot qualify for Level 3 rates when using a standard credit card terminal.

But do not worry because we offer a customized virtual terminal that can process Level 3 transactions in the same amount of time that it takes to process a standard credit card transaction.

Visa & MasterCard are also very particular regarding the way the Level 3 data is passed to them. In some cases, the data must fall within a specific range, quantity or format. So it's crucial that your business works with a merchant services provider that fully understands the requiements for Level 3 payment processing.

Tailored Transactions offers the experience and expertise necessary to get your eligible Level 3 transactions to qualify for the lowest possible interchange rates.

Follow the link below to contact us for a no-obligation Free Rate Quote!

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