Specific Interchange compliance requirements must be managed and include merchant category restrictions, authorization, clearing, timeliness and registration. For the card types that can qualify for Level 3, address verification, invoice number, tax amount, and line item detail fields like product code, item description, item quantity, unit of measure and extended item amount must be submitted with the standard sales information.
MasterCard and Visa Interchange differ for Level 3 in both rate and qualification requirements. With Visa commercial Interchange, submitting tax amount data is important to qualify for Level 2 rates. For tax exempt transactions, Visa offers Level 3 and B2B Interchange for 35 select industry categories as the next best rate. MasterCard's commercial Level 3 program is know as Data Rate III and these Interchange rates are available for Corporate, Business, Purchasing, Fleet, World Business, World Elite Business, World Corporate, World Elite Corporate charge types. MasterCard's Interchange includes a Corporate Large Ticket program.
April 2010 Interchange adjustments by MasterCard will impact Level 2 (Data Rate II) qualifications making the move to Level 3 (Data Rate III) even more valuable.
With the April 2010 changes, MasterCard has revised the qualification criteria for Commercial Face to Face and Commercial Data Rate II. Effective April 2010, zero will no longer be accepted as a valid tax value to qualify for these rate categories. Only non-zero tax values that fall within the specified valid range will be accepted as qualifying for Commercial Face to Face and Commercial Data Rate II Interchange. Therefore, if a commercial transaction has no sales tax (your tax exempt client transactions), the transaction will downgrade to a lower Data Rate I Interchange level.
In summary, qualifying a commercial MasterCard for Level 2 will now require submitting a tax amount >$0. MasterCard Level 3 Interchange will not be impacted and will still accept tax amount >=$0. MasterCard tax exempt commercial card transactions downgrading from Date Rate II to Data Rate I could be qualifying at Data Rate III with a Vantage Level 3 merchant account. The Interchange difference between qualifying at Data Rate I verses Data Rate III is 85 basis points (0.85%). This is a significant savings.
Qualifying for incentive Level 3 processing rates while eliminating Non-Qualified surcharge fees may reduce your processing expenses by an average of 15% to 20%! For example, the difference between a Visa GSA purchasing card processed at Level 3 Interchange and hitting the next best Electronic Interchange is 85 basis points.
Leading indicators that your processing costs are too high:
- You have the same rates for both MasterCard and Visa
- You have only one Qualified Rate
- You pay Mid & Non-Qualified Rates
- You use a terminal for processing transactions
- You use a “B2C” virtual terminal or payment gateway
Contact us for a Level 3 Interchange quote detailing Visa, MasterCard and Discover commercial card rates, qualification requirements and next best rates.