Level II and III data can sound complicated, but in the most basic sense, they are about attaching more data points to credit card transactions.
The higher the level, the more data points, and, ultimately, the better the savings on interchange rates.
That’s because card issuers see Level II and III transactions as more secure and legitimate, and less likely to be contested after the fact, so they’re willing to offer discounts in return for that security.
For Level II, that means a merchant providing inputs like a customer code and sales tax. To take full advantage and deal in Level III transactions, a merchant has to go a few steps further, offering information like item descriptions, quantities, unit price, shipping zip code and more.
You can think of Level III processors as a kind of elite club; they’re most common among merchants handling large-scale business-to-business and government transactions. But putting in place the processes to include this data can bring some serious savings on interchange rates, which can come in at 1% lower than a standard transaction.
Imagine a merchant making a $10,000 sale to a large industrial buyer. Using a typical MasterCard interchange schedule, Level III can net over $100 in interchange savings, no small change for a company processing big transactions regularly and looking out for its margins.
But interchange savings aren’t the only benefit of using Level II or III data. It also allows companies to better monitor and and account for their transactions.
Imagine the employee on the other side of that $10,000 transaction, needing to make that high-dollar purchase in a timely manner. A business using a Level III purchase card can be more nimble, freeing its employees of some of the organizational checks when making purchases, knowing that all the important transaction details will be reported back by the card issuer.
Many merchants already include some Level II data, such as Customer Code or PO number, and Level III data, such as Invoice Number or Order Number, in order to facilitate reconciliation of payment transactions with their accounting systems. If implemented properly, Level II and III data can save time and money on both sides of the ledger.
What we do
So how does Chargent fit into all this? Well, with support for Level II and Level III data with many of our 30+ payment gateway integrations, Chargent helps you send those high-level data points to your payment provider. Since we are also in the business of helping you aggregate and control payment data in Salesforce, where all of your other customer data lives, it is the perfect place to manage enhanced payment data. Some of this Level II / Level III data is likely already stored in Salesforce, such as the following:
- Discount Amount
- Destination Zip Code
- Item Product Code
- Item Description
In addition, the flexibility of Salesforce gives you tools such as workflow rules and triggers, so you can auto-fill information in some Level II and Level III fields, making the process of sending enhanced data faster and easier, and opening up those favorable interchange rates.
All of a sudden, that elite club isn’t so hard to get into.