Level 3 ProcessingBy Marcy Bok, Marketing Director, i3Verticals  —   

You have probably been told that business credit cards are expensive to process but  that isn’t exactly true. There are steps that merchants can take to get lower pricing. If your company accepts business credit cards, you can qualify for better rates.

As a merchant that accepts business credit cards, then you know that the payments you accept are processed through an intricate and often complicated network of providers. Several factors affect who touches a payment. However, all payments are required to pass through the card networks such as Visa, Mastercard, American Express, and Discover.

When a payment passes through the card networks, a fee known as interchange is collected. Interchange is set by the networks, and that is why many merchants believe there is no way to reduce this specific fee. But that is not the case.

Although rates are set in advance by the networks, lower rates can be applied to payments that meet certain criteria. If the payment gateway passes Level 3 card data with a transaction, the details provided can qualify for lower interchange rates and those rates typically equal lower processing costs.

The card networks use many factors to determine interchange for transaction types, including card type, transaction amount, and whether the card was present at the time of the sale. For example, a $10,000 transaction that is made via a purchasing card on the Internet will be charged a different rate than a $100 transaction that is made via a pin-less debit card that was presented at the point of sale.

When this level of detail is included with qualified transactions, it can significantly reduce costs. Not all processors pass Level 3 data, and it is important that you partner with a service provider who can help your business benefit from these savings.

BokMarcy Bok is the marketing director for i3Verticals. i3Verticals is an AEM member company and provider of comprehensive software solutions with expertise across multiple industries. For more information, visit www.i3verticals.com

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