Most likely, your business accepts credit card payments from businesses, but few know how to utilize level 3 credit card processing. This would make you miss out on cutting significant business costs.
Here is why.
Understanding Level 3 Credit Card Processing
In general, level 3 credit card processing is a particular set of additional details including quantities, descriptions, and tax detail among others that credit card brands like MasterCard or Visa want to obtain on business type credit card transactions, in addition to the required standard details. For providing the additional details, they’ll provide considerably reduced interchange rates – from .50% to as much as 1.00% – on eligible business to business or B2B credit card transactions.
Why the Reduced Interchange Rates?
The additional transaction details on level 3 credit card transactions obtained by credit cards holds significant value for specific major holders of business cards. These pertinent details, once relayed to credit card holding companies, will allow businesses the capability of monitoring, tracking, and obtaining applicable sales tax data, as well as a purchase’s set restrictions charged to a company credit card.
These particular level 3 credit card transactions data aids businesses on the receiving end in minimizing improper spending and allows them to monitor their business costs, charged purchases, and why the purchase was made. This will in turn result in the businesses improving their operations because of lower and more manageable expenses.
Eligibility of Level 3 Credit Card Transactions
Note that only business credit card types can be eligible for level 3 credit card processing. This means that if your business mostly sells to general consumers, rather than businesses, you couldn’t take advantage of the reduced level 3 credit card interchange rates.
Keep in mind though that eligibility won’t automatically afford you these reduced interchange rates. You should likewise be able to submit level 3 transaction details through a level 3 supported gateway or software since you can’t be eligible for level 3 processing if you only use a standard terminal for credit card transactions.