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How to lower your costs on virtual cards & ghost cards using Level 3

Ever felt bogged down by those high B2B transaction fees and seemingly never-ending processing times? Well, there might be a silver lining you haven't discovered yet: Level 3 processing. Don't worry if it sounds a bit techy—we're here to break it down for you. In this piece, we'll dive into what Level 3 processing really means, who it's tailor-made for, and how it can give your B2B dealings a serious boost.

What is Level 3 Processing?

Level 3 processing is a specialized form of credit card transaction. Instead of just the basic data, it requires a deeper dive into the transaction's details. Typically used for situations where the card isn't physically present (think "virtual" or "ghost cards"), it asks for specifics like item descriptions, quantities, prices, the tax amount, merchant's name, and the transaction date.

The goal? More transparency for each transaction, which helps in reducing fraud and making the entire process more streamlined for businesses.

Who is Level 3 Processing Useful For?

Level 3 processing is useful for businesses that frequently process high-value B2B transactions, such as wholesale distributors, government agencies, and large corporations. These businesses can benefit from lower transaction fees, faster processing times, and improved data reporting.

In What Context is Level 3 Processing Used?

Level 3 processing is used in B2B transactions where more detailed transaction data is required. This could include transactions involving large purchases of goods or services, such as construction materials, medical equipment, or office supplies. Government agencies, which often require detailed reporting and transparency, are also frequent users of Level 3 processing.

How Do Businesses Take Advantage of Level 3 Processing?

To take advantage of Level 3 processing, businesses need to ensure that their payment processing systems support this feature. Businesses may need to work with their payment processor or payment gateway provider to enable Level 3 processing.

Once enabled, businesses can provide more detailed transaction data to the payment processor, including item descriptions, quantities, and prices, and tax amount. This data will help the payment processor evaluate the transaction and determine if it is eligible for lower fees.

Using Level 3 processing can provide several benefits for your business, including:

  1. Lower transaction fees: Because Level 3 processing provides more detailed information about the transaction, it is considered lower risk. As a result, payment processors may offer lower transaction fees for Level 3 transactions compared to standard credit card transactions.
  2. Faster funding: Level 3 processing can speed up the funding process for high-value transactions. Because the additional data provided reduces the risk of fraud, payment processors may release funds more quickly than they would for standard transactions.
  3. Increased transparency: By providing more detailed information about the transaction, Level 3 processing can increase transparency in B2B transactions. 
  4. Better data tracking: Level 3 processing provides more detailed data about transactions, which can be useful for tracking expenses, analyzing purchasing patterns, and making informed business decisions.

Wrap Up

If B2B transactions are a big part of your world, Level 3 processing might just be the tool you didn't know you needed. It's all about boosting transparency, saving some cash, and getting insights from your data.

Curious to dive deeper? Give us a shout—we're always up for a chat! 😀

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