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B2B and B2G Payments: Easily Save on Interchange Fees

Published July 7th, 2020 by Servistree

Many businesses that service the B2B and B2G clients are leaving money on the table and don’t realize it. The fees from credit card processing are a part of doing business, but most businesses are unaware that card brand programs do exist to help reduce these fees. A common misconception is that the payment processor’s mark-ups are the only place to save on fees. The more significant savings potential is actually in the interchange – do not assume you cannot influence and reduce these costs! Interchange is essentially the hard cost of payment card acceptance. Interchange fees are those collected for the card-issuing bank and cover the operational costs and risk associated with issuing credit cards. Payment processors charge merchants a mark-up on top of interchange, which covers their operational cost and risk associated with processing electronic payments.

There are over 300 levels of interchange with rates ranging from as low as .05% to as high as 3.25%. What determines the cost of interchange is based on many factors, including benefits given to the cardholder and perceived risk. While each interchange level might have static costs pre-determined by the card brands (Visa/MasterCard), many transactions are eligible to qualify at lower-cost tiers.

By optimizing interchange qualifications, transactions can land at the lowest possible interchange rates. Servistree Merchant Services in Ft. Lauderdale Florida offers an automated Commercial Card Optimization system that automatically collects the additional data to reduce the risk associated with each transaction. Most merchants collect Level I data, which includes the minimum information required to authorize and process a payment transaction. Collecting less data increases the risk for fraud, which is why Level I data carries the higher fees.
Level II and Level III transactions are enhanced data capture levels that provide more in depth information, usable by the card brands and their issuers. The additional information has value to the card networks, their issuers and the merchant customer and could qualify the merchant for reduced interchange fees if the enhanced data is presented with the transaction authorization.

Servistree’s Commercial Card Interchange Optimization For B2B and B2G Payment Processing

Providing Level II and Level III data points can be a challenge for businesses for a variety of reasons:

  • Businesses may not reliably collect the required information from their customers
  • Lack a solution that can transmit the data in the required format
  • Their current payment processor is not certified to process Level II and Level III data
  • Servistree Merchant Services provides a proprietary Level II and Level III data enrichment program that automatically populates all of the data for the merchant with no up-front cost to the merchant.

About Servistree

Since 2009, Servistree has been a leader in payment processing, leveraging the world’s best technologies for our customers all across the United States to locally-owned small businesses. We extend powerful payment solutions for all payment types and credit card processing environments, ensuring that your business is well-connected and secure. If you have questions about B2B Credit Card Processing or to learn more about our services call us anytime at 866-944-3244

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