For years, businesses processing commercial card transactions relied on Level 2 and Level 3 data to reduce interchange costs. If you could pass enhanced transaction details—even if they weren’t perfect—you could often qualify for better rates.
That model is changing.
As of April 2026, Visa is reclassifying Level 2 and Level 3 processing, consolidating both into a new classification called “Product 3.” While this may sound like a simple rephrasing, it actually represents a major shift in how merchants will qualify for lower processing rates going forward.
Why Visa Is Making This Change
The transition to Product 3 is driven by Visa’s Commercial Enhanced Data Program (CEDP), launched in April 2025. The goal of the program is to improve the accuracy and reliability of transaction data using AI.
In the past, merchants could submit partial or placeholder data when processing and still receive Level 2 or Level 3 pricing benefits. That created an opportunity for businesses to reduce costs, but it also meant Visa was approving transactions without fully verifying the underlying data.
Now, Visa is tightening that process.
Instead of simply accepting submitted data, the network is actively validating it. That means transaction details must be complete, consistent, and accurate. If they are not, the transaction no longer qualifies for preferred pricing.
What “Product 3” Really Means
Under the new structure, the distinction between Level 2 and Level 3 is essentially gone. Everything falls under Product 3, but qualification is more difficult.
To meet the new standard, transactions must include detailed and verifiable information such as:
- Product-level detail (SKU, category)
- Unit pricing and quantities
- Consistent formatting across transactions
More importantly, that data must align with what Visa expects to see based on your business type and transaction behavior.
This introduces a new reality for merchants:
- Qualification is no longer static
- Data quality is continuously evaluated
- Rates can change based on performance
A business may qualify for better rates one month and lose that qualification the next if the data does not meet Visa’s requirements.
The Cost Impact for Merchants
For many businesses, especially those that rely on Level 2 data, the impact will be immediate.
With Level 2 being eliminated, transactions that previously qualified at that level may now default to higher-cost categories unless they meet full Product 3 standards. Businesses that are not submitting accurate or complete data are already seeing increased rates.
This is particularly significant for:
- B2B companies processing large invoices
- Wholesalers and distributors
- Businesses with complex or inconsistent product data
These groups historically benefited the most from enhanced data programs and now face the greatest pressure to adapt.
At the same time, broader pricing trends are pushing costs higher across the board. As one industry perspective puts it, “3% is the new 2.5%,” reflecting how quickly margins are tightening.
How Businesses Can Adapt
The most important takeaway is that data accuracy is no longer optional—it is directly tied to cost.
Businesses that want to maintain or improve their rates should focus on:
- Sending complete, accurate transaction data every time
- Integrating payment systems with ERP or inventory platforms
- Using tools that support structured data transmission when needed
While some platforms can help fill in gaps, the most reliable solution is a fully integrated system that sends true transaction data directly from the source.
Looking Ahead
This shift is unlikely to stop with Visa. Mastercard has historically followed similar trends, which means these requirements could soon become standard across card networks.
For merchants, the message is clear: the era of “good enough” data is over. Those who invest in accurate, integrated systems will be better positioned to control costs, while those who do not may continue to see rates rise.
Payment Solutions Meant to Save You Time & Money
If you’re unsure whether your business is meeting Visa’s new data requirements, now is the time to take a closer look. Evolve Payment can help you improve efficiency, integrate your systems, and position your transactions for the lowest possible rates.
Questions? Give us a call or submit a form for a free cost analysis.