Business to Business
The card brands decided to use Enhanced Data (Level II and Level II processing) to lower the costs of interchange for B2B and B2G transactions, especially large-ticket items. Enhanced Data is additional information that you can submit with the transaction to notify the issuing bank that this is an authorized transaction for a specific good or service. Enhanced data fields include but are not limited to Order ID, PO Number, Order Description, Shipping, Tax, Commodities Codes, Shipping From Zip, Shipping To Zip and the like. When this information is submitted with the transaction, the likelihood of a chargeback due to fraud decreases tremendously. So, the card brands pass along interchange savings to the merchant running the transaction.
We offer this kind of interchange optimization in a couple different ways. The easiest and most passive way is to utilize Elavon’s interchange optimization program. This program allows Elavon, our processor, to input the data on the merchant’s behalf based on AI and machine learning. The merchant doesn’t have to do anything, just run the transactions like normal after they’ve opted into the program. It costs the merchant nothing out of pocket, but Elavon will keep a portion of their savings as a service fee. The Magothy Payment Gateway also offers Level II and Level III processing. The merchant will have to input the information themselves, but we offer order templates that allows the merchant to preconfigure templates for the items/services they sell most often and apply them to the transactions with a click of a button.
Passing along enhanced data typically saves 0.20% to 0.50% in interchange fees, but it can be as much as 1.00% on large-ticket items. If you have B2B or B2G sales, you should definitely have some sort of platform to pass along enhanced data to save money.