Lower Interchange Rates through Information and Tech
Visa and MasterCard have created specific issued card types that help corporations monitor and track spending by collecting a set of additional line-item details. These card types are categorized and defined as Level 3 cards.
Level 3 cards allow a business to stay on top of their spending, ensuring that their funds are best utilized to further operations.
If processed correctly, Level 3 interchange can be 1.00% lower than their standard counterparts!
However, in order to gain access to beneficial Level 3 rates, a merchant is required to input a fair amount of information on each transaction. In addition, only certain gateways can accommodate for Level 3 data.
If a Level 3 capable gateway or software is not used, these card types come with some of the highest interchange fees in the industry ranging from 2.5% - 3.5%.
Case Study: Building Materials Industry
The building materials distribution industry is comprised mostly of Business-to-Business customer relationships.
According to Visa and MasterCard data a large percentage of these distribution customers pay with Purchasing Cards, Corporate Cards, and Business Cards.
These card types make up what the Credit Card industry refers to as Level 3 transactions.
These card types come with some of the highest interchange fees in the industry, ranging from:
2.5% - 3.5%
There are several software and hardware products on the market you can purchase to help reduce these higher interchange rates. These products do come with a cost, typically additional and monthly fees, and additional data entry by yourself.
The extra data entry, up to 15 required data fields with every transaction, makes the Level 3 cost reduction cumbersome to achieve.
Level 3 Card Acceptance Automation
CLARUS Merchant Services has worked with our processor to create automated Level 3 card acceptance, eliminating the extra data entry requirement.
To you, the benefit and what this means:
Removing the need for you to spend time collection extra data from your customers.
Removing the need for you to purchase and use additional hardware, software, or gateways.
And most importantly, automated savings.
Simply put, this equates to a rate reduction and lowering your business expense without changing how you accept payments today.
