Get the Advice you Need
Dharma works closely with many B2B clients to help get the lowest rates possible. Our team is trained in helping your business keep costs low, based on your business type, acceptance methods, and more. Let our analysts review your current processing statements to locate potential rate reductions and hidden fees from your current provider. (See a list of qualifying interchange rates, here). Plus, we’ll provide guidance in finding a solution that will allow your business to streamline your payment acceptance.
Many businesses don’t realize that they’re treated differently by Visa/MasterCard when processing B2B payments. In particular:
- Merchants with certain MCC codes get access to reduced interchange rates, if they’re properly classified
- Merchants processing large sales (over $6,500) can access even lower interchange rates
- Merchants capturing additional data with the sale (invoice numbers, sales tax information, etc) get access to lower rates
- Specific software or terminals are required to process B2B sales with level 2 information
Software to streamline your Payments
Dharma works with the NMI Gateway to provide upper-level features at low rates for Business 2 Business customers. NMI gives your business access to these great feature sets:
- A Virtual Terminal that allows you to input level 2 data, so that you get the lowest possible rate for your large B2B sales
- Access to the Customer Vault and Inventory Manager, so that you can store sensitive credit card data and common product sales for easy reference
- Access to ACH (eCheck) processing for only $20/month and $0.35/transaction
- Email Invoicing so that you can send a “Click to Pay” request to your customers. PDF invoices are automatically generated and included for your customers
- Manage multiple merchant accounts from a single interface – known as “Multi-MID” support
- Many more features, built in for no extra fee
What kinds of Savings can I expect?
This is the answer everyone wants to know! If I accept level 2 business to business transactions, how much can I expect to save? There are many different interchange rates that “qualify” for a level 2 reduction, so we’ll focus on some of the more common/popular ones. In addition, bear in mind that there’s room for even more savings if you process large transactions (over $6,500) and utilize level 3 data. By entering Level 3 data, you could qualify for large ticket rates. Scroll down to see a few example transactions, both without level 2 data, and also including level 2 data to see the cost savings. Then, we’ll show some sample level 3 transactions as well.
Read on, below. We’ll pretend we’re running $5,000 transactions for the purposes of our level 2 examples, to see what kinds of savings we can expect when inputting level 2 data with a transaction.
We’ll assume that this was a MasterCard Corporate card. Without level 2 data, a typical MasterCard business card will have the underlying interchange rate of 2.65% + $0.10. So, for a $5,000 sale, the math is straight-forward: $5,000 x 2.65% = $132.5. Add in the $0.10 transaction fee, and the total underlying interchange fees are $132.60 for a $5,000 sale.
But what happens if we run this as a level 2 transaction? Per MasterCard, if you include all pertinent level 2 data, the underlying interchange rates fall all the way to 2.00% + $0.10/transaction! That’s significant – running the quick math tells us that the sale only costs $100.10 in interchange fees, significantly less than the $132.60 we started at! That’s over 24% savings in interchange fees!
We’ll assume that this was a Visa Purchasing card. Without level 2 data, a typical Visa Purchasing card will have the underlying interchange rate of 2.55% + $0.10. So, for a $5,000 sale, the math is straight-forward: $5,000 x 2.55% = $127.50. Add in the $0.10 transaction fee, and the total underlying interchange fees are $127.60 for a $5,000 sale.
But what happens if we process this with level 2 data? Per Visa, if you include all required level 2 data with the sale, the underlying interchange rates fall all the way to 2.05% + $0.10/transaction! Not bad – plugging in those numbers tells us that the sale only costs $102.60 in interchange fees, much less than the $127.60 we began with! That’s almost a 20% reduction in interchange fees.
Large-Ticket Interchange Reductions
Does your business take B2B payments via credit card that are over $6,500? In particular – if you accept Visa transactions that exceed $6,500 or MasterCard transactions that exceed $7,255, you may be eligible for even further reduced interchange rates. Visa/MasterCard fully recognize that larger B2B transactions occur frequently, and do their best to keep rates low if you supply all proper level 2/3 information. To be clear – to access these interchange rates, you are required to utilize level 3 data, and you’ll need to speak with an Account Manager at Dharma to ensure we’re setting everything up properly. But, savings are significant. Here are the two popular categories:
Visa GSA Large Ticket: 1.20% + $39.00/sale. For a $15,000 sale, you’d pay $219, or only 1.46% in total interchange fees. Compare that to the 2.55% you’d have paid normally, and you’re looking at interchange savings of over $160 on a single $15,000 Visa transaction. That’s a 42% reduction from standard interchange rates!
MasterCard Corporate Large Ticket 1: 1.25% + $40.00/sale. For a $15,000 sale, you’d pay $227.50, or only 1.52% in total interchange fees. Compare that to the 2.65% you’d have paid normally, and you’re looking at interchange savings of over $170 on a single $15,000 MasterCard transaction. That’s a 42% reduction from standard interchange rates!