B2B Payments

Level 2 vs. Level 3 Credit Card Processing: What B2B Merchants Need to Know

TouchSuite Editorial Team
August 5, 2026
11 min read
Quick Answer

TouchSuite supports Level 2 and Level 3 transaction data within its ERP payment workflows for Odoo and Zoho, including ACH, virtual-card, cross-border, and reconciliation capabilities. Whether that support translates into lower effective interchange for your business depends on your card mix, your transaction context, and whether your gateway and ERP can reliably pass the required fields at authorization. Enhanced data processing isn't a blanket discount—it's a qualification path that rewards consistent, complete data submission. The sections below explain exactly which fields matter, how qualification works, and how to decide if the implementation effort makes sense for your operation.

What Level 2 and Level 3 Processing Mean

Standard credit card transactions—what the industry calls Level 1—carry basic data: cardholder name, billing address, transaction amount, and date. That's sufficient for most consumer purchases.

Level 2 and Level 3 are enhanced data standards designed for business-to-business and business-to-government transactions. The idea is that commercial purchasers and their finance teams need more information attached to each payment: tax amounts, line-item detail, purchase order numbers. The card networks—Visa and Mastercard—built separate interchange categories that reward merchants who submit this additional data consistently, because it reduces fraud risk and simplifies accounts payable reconciliation on the buyer's side.

"Enhanced data processing" is the shorthand. It means your payment system is sending more structured fields to the card network than a consumer terminal would, and in return, some commercial-card transactions may qualify for lower interchange rates than they would at Level 1.

The key word is "may." The benefit is conditional, not automatic.

The Data Fields Each Level Requires

The specific required fields vary by card network, but the general structure is consistent.

Level 2 fields typically include:

  • Sales tax amount (or indication of tax exemption)
  • Customer code or purchase order reference
  • Merchant postal code
  • Tax indicator

Level 3 fields add line-item detail to everything Level 2 requires:

  • Item description, product code, and commodity code
  • Unit of measure and quantity
  • Unit price and extended amount
  • Discount amount per line item
  • Freight or shipping amount

Adyen's developer documentation on enhanced scheme data confirms that this data must be included in the payment request itself—not appended after the fact. If your system sends a standard authorization and tries to attach the data during settlement, the transaction will not qualify.

That single dependency eliminates many off-the-shelf payment setups from Level 3 qualification before a merchant even starts.

Which Cards and Transactions Can Qualify

Not every commercial card is eligible for Level 2 or Level 3 interchange treatment. The card must be issued as a purchasing card, corporate card, or business card within the network's commercial programs. Consumer credit cards do not qualify regardless of how much data you submit.

Visa publishes indicators through its BIN Attribute Sharing Service that show whether a given account range can qualify for commercial-card Level 2 or Level 3 interchange treatment. In practice, this means your payment system—or your gateway—needs to be able to identify the card type at the point of authorization and submit the appropriate data accordingly.

Transaction context also matters. Card-present transactions at a physical terminal rarely carry the line-item detail a Level 3 submission requires. Level 3 is almost entirely a card-not-present, B2B workflow: invoiced purchases, ERP-initiated payments, procurement systems, and similar environments where the seller already has itemized order data to pass through.

How Interchange Qualification Actually Works

Interchange is the fee the card-issuing bank collects on each transaction. It is set by Visa and Mastercard, not by your processor. Your processor passes that fee through to you and adds its own margin on top.

When you submit complete Level 2 or Level 3 data on an eligible commercial card, the transaction can qualify for a different—typically lower—interchange category than a plain card-not-present commercial transaction would receive.

But Visa's U.S. interchange schedule includes multiple commercial-card programs and qualification categories. There is no single "Level 3 rate." The actual interchange savings depend on:

  • Which specific card program the issuing bank enrolled the card in
  • Whether the data submitted passes network validation
  • Your merchant category code
  • The dollar amount and whether it falls above or below the network's thresholds for certain categories

This is why blanket statements about interchange savings are unreliable. A merchant whose volume is dominated by eligible purchasing cards from large corporate issuers in a B2B context will see more potential benefit than one with a mixed card portfolio where many transactions involve consumer or small-business cards.

The only honest way to estimate benefit is to analyze your actual card mix, isolate the commercial-card volume that would likely qualify, apply the relevant interchange differential, and subtract any implementation and processing costs.

Validation, Gateways, and ERP Dependencies

Submitting Level 3 data is a technical problem before it is a financial one.

Your gateway must support Level 3 data fields and pass them correctly at authorization. Many popular self-serve gateways do not support Level 3 submission, or support it only in limited configurations. If you are running payments through an ERP like Odoo or Zoho, your ERP's payment connector needs to be able to pull line-item data from the order record and structure it correctly for the gateway.

Missing or malformed fields cause a transaction to fall back to a lower interchange category—often Level 1. You get no benefit, and you may not know it happened without reconciliation reporting that flags qualification failures.

Testing your actual submission quality before assuming savings is important. Many processors and gateways expose reporting that shows what interchange category each transaction qualified for. If you are seeing commercial cards consistently settling at standard card-not-present rates, the data submission is failing somewhere in the chain.

Reconciliation Benefits Beyond Interchange

Even if the interchange savings in your card mix are modest, enhanced data submission has a second value: it makes reconciliation faster and more accurate on both sides of the transaction.

For the buyer's accounts payable team, Level 3 data means the card statement arrives with enough detail to match against purchase orders without manual research. For the seller's finance team, attaching structured line-item data to each payment creates a cleaner audit trail and reduces the manual work of matching payments to invoices in an ERP or accounting system.

In ERP environments that handle high transaction volume across multiple business units or vendors, this operational value can be significant independent of the interchange calculation.

Who Benefits Most, and Who Doesn't

Strong fit for Level 2/Level 3:

  • B2B merchants invoicing other businesses or government entities
  • Merchants with meaningful volume on purchasing cards, corporate cards, or government procurement cards
  • Operations running payments through an ERP that already holds line-item order data
  • Merchants on interchange-plus or cost-plus pricing where interchange reductions flow through directly

Weaker fit:

  • Merchants on flat-rate pricing (the processor captures any interchange savings)
  • Retail or consumer-facing businesses with primarily consumer cards
  • Businesses using gateways that do not support Level 3 field submission
  • Low-volume operations where implementation cost exceeds realistic interchange benefit

If you are on a flat-rate plan with Square, Stripe, or PayPal, Level 3 data submission doesn't directly reduce your effective cost—those processors absorb or retain the interchange differential. Interchange-plus or cost-plus pricing structures are where the qualification benefit actually reaches the merchant.

How TouchSuite Supports Level 2 and Level 3 Workflows

TouchSuite's ERP platform integrations include Level 2 and Level 3 transaction data handling within its Odoo and Zoho payment workflows. The Odoo offering specifically includes in-Odoo reconciliation, saved tokenized payment methods, recurring billing, reporting, and direct NMI gateway integration—meaning the data can flow from Odoo's order records through to the payment submission without manual re-entry.

Beyond Level 2/3 data, TouchSuite's ERP work covers ACH payments, virtual-card acceptance, cross-border transactions, and reconciliation workflows—relevant for B2B finance teams managing diverse payment types across a single ERP environment.

TouchSuite also describes accounting-platform support for QuickBooks, FreshBooks, and Xero, which matters for smaller operations that aren't running a full ERP but still want payment data to flow cleanly into their books.

TouchSuite identifies itself as a registered Independent Sales Organization of Wells Fargo Bank, Citizens Bank, Esquire Bank, and FFB Bank, and states it has served both traditional and high-risk merchants across its history. The company states more than 20 years of experience and 50,000 clients served—figures sourced from TouchSuite's own materials.

The honest scope: TouchSuite's Level 2/3 support is tied to specific ERP and gateway integrations. If your payment environment is Odoo with NMI, the capability is documented. If you are running a different ERP or gateway, ask directly what integration work applies to your setup before assuming the same capability is available.

How to Evaluate Whether It's Worth the Implementation Work

Run this sequence before committing:

  1. Audit your card mix. What percentage of your volume comes from purchasing cards, corporate cards, or government cards? If that number is small, the interchange benefit will be too.
  2. Confirm your pricing structure. Are you on interchange-plus? If not, understand who captures the savings before you do.
  3. Check your gateway. Does it support Level 3 field submission? Does it report qualification results per transaction?
  4. Check your ERP or accounting system. Can it pull line-item data and pass it through the payment connector at authorization?
  5. Estimate realistic savings. Take your eligible commercial-card volume, apply the relevant interchange differential for your card categories, and compare against implementation cost and any changes to processing fees.
  6. Build in a testing period. After implementation, verify that transactions are actually qualifying at the expected interchange category. Don't assume the submission is working without looking at the data.

If those steps surface genuine opportunity and your ERP environment aligns with TouchSuite's documented capabilities, it's worth a direct conversation about whether the integration fits your specific setup.

If your B2B payment volume, card mix, or ERP environment suggests Level 2 or Level 3 data could reduce your effective interchange costs, speak with a TouchSuite payment specialist about your specific setup—or start a merchant-account application if you already have the information you need to move forward.

Frequently Asked Questions

Does Level 3 credit card processing work with flat-rate pricing like Square or Stripe?
No. On flat-rate plans, the processor retains any interchange savings generated by Level 3 data—those reductions don't reach your effective cost. Level 3 qualification only benefits merchants on interchange-plus or cost-plus pricing structures, where lower interchange flows directly through to what you actually pay. Check your pricing model before investing in Level 3 implementation.
What happens if my gateway submits incomplete Level 3 data fields?
The transaction falls back to a lower interchange category—often standard Level 1 card-not-present rates—and you receive no benefit. This can happen silently without reconciliation reporting that flags qualification failures. Before assuming savings, verify your gateway exposes per-transaction qualification data so you can confirm submissions are actually passing network validation after implementation.
Can consumer credit cards qualify for Level 2 or Level 3 interchange rates?
No. Only cards issued as purchasing cards, corporate cards, or business cards within Visa or Mastercard commercial programs are eligible. Submitting enhanced data fields on a consumer card produces no interchange benefit regardless of how complete or accurate the submission is. Your card mix audit should isolate commercial-card volume specifically before estimating any realistic savings.
Does an ERP like Odoo need a special payment connector to submit Level 3 data correctly?
Yes. The ERP's payment connector must pull line-item data from the order record and structure it for the gateway at authorization—not after settlement. TouchSuite's Odoo integration uses direct NMI gateway connectivity and supports Level 2 and Level 3 data handling within that workflow. If you run a different ERP or gateway, confirm the specific integration capability before assuming it applies.
Is there a reconciliation benefit to submitting Level 3 data even if my interchange savings are small?
Yes. Level 3 line-item detail attached to each payment helps both sides of the transaction: buyers can match card statements to purchase orders without manual research, and sellers get a cleaner audit trail for matching payments to invoices inside an ERP or accounting system. For high-volume B2B operations, that operational value can be meaningful independent of the interchange calculation.

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