If you are like most business owners you already understand the basics of credit card processing and merchant services. Your business already accepts most major credit and debit cards and for the most part the system is functioning well. But did you know that Level 3 capabilities would allow you to expand your target market? If bigger business-to-business or business-to-government sales are part of your growth strategy then you need to know a few key details about Level 3 processing. Let’s get started.
Level 3 Processing Basics
Very simply stated the primary difference between levels of processing (Level 1, 2 & 3) is the type of additional data that must be captured with each transaction. Therefore your payment processing system must be set up to capture and transmit the additional data to meet Level 3 requirements. Some examples of the data that your system must capture would be Customer Code, Merchant Postal Code, Tax Identification, Item Quantity, Duty Amount, Destination Postal Code and Alternate Tax Amount. We created this reference guide that compares the amount of data required for each level of transaction. This additional information not only provides greater detail to the buyer for tracking and management purposes but also provides significant cost savings because Level 3 rates are lower than Levels 1 & 2.
From Basics to Benefits
The benefits of Level 3 processing are many for you and your business. We’ve listed just a few benefits for you to consider.
- Cost savings is the primary benefit because both the buyer and the merchant enjoy a lower processing rates. And a Level 3 merchant account will improve your profitability and reduce payment time from 1-2 months to 1-2 days. Check out our article on reduced fees for more details.
- Offering Level 3 processing is also a great selling tool for your business giving you a competitive advantage. A large corporation or government entity looks to suppliers that are set up to support this type of transaction and often make it a requirement before agreeing to do business with a supplier.
- The expanded features associated with this technology include the ability to do a variety of time saving tasks. Features such as accepting payment by electronic check; automated online invoicing; shopping cart integration; and integration with a merchant’s accounting system make this a technology worth exploring.
Go Big as a Growth Strategy
Expanding your target market to include large corporations and government entities is a solid business strategy that could really jump start your company’s growth. But be sure to take time to plan and to put the necessary resources in place first. Becoming a Level 3 processing merchant is one way to support your ‘go big’ strategy for the long term. You take care of the strategy and we’ll take care of the details. Give us a call and we’ll be happy to answer any of your Level 3 processing questions.