Why Are My B2B Processing Costs So High?

Different Interchange Rates Equals Different Fees

Are you achieving Level 2 and Level 3 interchange for the P-Cards and corporate credit cards you are accepting from your customers? Let’s examine what Level 2 and Level 3 interchange actually means.

If you are a B2B merchant, Visa and Mastercard have designated special interchange rate (or the fee per card swipe) categories specifically for your business as a card-not-present (CNP) acceptor. What this means to you is that your business could be paying less for processing credit card payments.

Level 2 and Level 3 interchange is an extension of processing that requires more data to be passed to the card-issuing banks which results in lower processing rates. When you collect more information about the cardholder from the card, it lowers the risk of fraudulent activity. Lower risk means less fees, otherwise referred to as a lower interchange rate. Oftentimes these rates can be more than a full percentage point lower than processing at Level 1, saving you thousands of dollars in processing fees; sometimes even hundreds of thousands depending on how much volume you process.

Requirements for Level 1, 2, and 3

Here is a chart that lays out the difference between Level 1, Level 2, and Level 3 requirements for processing credit cards. Go through the chart to determine what level your business qualifies for then compare it to your statements. If you are not seeing Level 2 and Level 3 on your statements, you are not receiving the lower interchange rates and it is costing you more to process payments.

It’s Time to Work with a Merchant Processing Partner

If you are not working with a B2B and card-not-present partner for processing payments, you are likely not using your qualified interchange level and it’s costing your business money.

After years in this field, I find that most companies only working with their bank for merchant processing are losing money daily by not effectively processing. While banks have their specialties, unfortunately processing payments is just not one of them. Level 2 and Level 3 interchange rates are specifically set aside for B2B and card-not-present acceptors, and companies need to process in accordance with these levels to receive the reduced fees.

If you are a B2B company, you need to have a company that knows the details of how to process payments, and effectively. The great news is that it’s not too late. There are companies like Evolve Payment that specialize in B2B card processing and can walk you through the process of achieving lower rates and improving your bottom line.

Statements are set up to be extremely confusing so merchants don’t really know what to look for. Fortunately, we have over 20 years of experience navigating all types of statements and can help you review your current position, where you want to be, and how to get there.

Get In Touch with Us!

As a boutique provider, Evolve Payment will walk you through the entire process of what accepting payments should look like and what a great experience could be. With our commitment to transparency and integrity, you will know exactly what you are paying without any hidden costs. Everything is upfront and there are no surprises.

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