Questions
B2B payment questions, answered directly
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All questions
Level 3 data
What is Level 3 processing?
Level 3 processing is the transmission of detailed line-item data alongside a commercial card transaction so it qualifies for the lowest interchange rate the card networks offer. It requires product codes, item descriptions, quantities, unit prices, freight and duty on top of the Level 2 requirements of sales tax and a purchase order reference. It applies only to commercial, corporate, purchasing and government cards, because consumer cards have no Level 3 category.
Updated September 30, 2026
Interchange
Why do credit card transactions downgrade?
A transaction downgrades when it fails to meet the requirements of the interchange category it would otherwise qualify for and settles at a more expensive one instead. Common causes are missing line-item or Level 2 data, freight billed on a separate invoice, settlement outside the required window, a missing purchase order reference, and sales tax left blank rather than flagged exempt. A downgrade produces no error and no alert: the payment succeeds normally and simply costs more.
Updated September 30, 2026
Pricing models
What is an effective rate, and how do I calculate mine?
Your effective rate is total processing fees divided by total processing volume for the same period, expressed as a percentage. It includes every fee on the statement: interchange, assessments, markup, monthly fees, PCI fees, gateway fees, batch fees and statement fees. It is the only number that describes what you actually pay, and it is almost always higher than the headline discount rate you were quoted.
Updated September 30, 2026
ACH
Is ACH cheaper than a credit card for B2B invoices?
On large invoices, almost always. ACH is priced as a flat fee per transaction and a card as a percentage of the invoice, so the gap widens with every dollar. The fee on a $50,000 ACH payment is identical to the fee on a $500 one, while the card cost scales throughout. On small invoices the two can be comparable, and the crossover point depends on your specific pricing.
Updated September 30, 2026
Level 3 data
Can a virtual terminal send Level 3 data?
Generally no. A standalone virtual terminal has no connection to your invoice lines, so it cannot transmit the product codes, quantities, unit prices and freight amounts Level 3 requires. Some gateways offer an enhanced-data entry screen where a user types line items manually, which does qualify, but it doubles data entry and degrades the moment somebody is busy. The durable answer is a connector that reads the invoice directly from your ERP.
Updated September 30, 2026
ERP integration
Which ERP systems can send Level 3 data?
Every major ERP holds the data Level 3 requires, because it is already on the invoice. The question is whether a payment connector exists that reads it and transmits it. Connectors are available for NetSuite, Sage, QuickBooks, Acumatica, Epicor and SAP Business One, though capability varies by product and version. Where no connector exists, the options are a gateway with manual enhanced-data entry or a custom API integration.
Updated September 30, 2026
High-ticket invoices
Why did our large customer payment decline?
Most often because of a per-transaction cap or velocity limit on your own merchant account rather than anything on the customer's card. These limits are set during underwriting based on your financials, average ticket and processing history, and they do not grow with your business unless somebody asks. The decline reason is frequently not passed through to whoever ran the payment, which is why it looks like a customer problem.
Updated September 30, 2026
Underwriting
What triggers a processing reserve?
A reserve is a held portion of your settlement, released on a schedule, imposed when a processor judges its exposure has increased. The common triggers in B2B are rapid volume growth, average ticket size rising substantially, customer concentration where a small number of customers make up most of your volume, an increase in disputes or refunds, and a business model where payment is taken well before delivery.
Updated September 30, 2026
Statements
How do I read a merchant processing statement?
Work in three passes. First, total every fee for the month and divide by total volume to get your effective rate. Second, separate the statement into interchange (set by the card networks, pass-through), assessments (Visa and Mastercard, also pass-through) and markup (your processor's margin, the only negotiable part). Third, find the commercial card transactions and check which interchange category each settled at.
Updated September 30, 2026
Pricing models
What is interchange-plus pricing, and is it better?
Interchange-plus pricing passes through the interchange set by the card networks at cost and adds a disclosed markup, itemized separately on your statement. It is better than tiered or flat-rate pricing for most B2B sellers for one specific reason: it is the only model where you can see whether your transactions are qualifying. Under tiered pricing a downgrade is absorbed into a bucket, and under flat rate it does not affect what you pay at all.
Updated September 30, 2026
AR automation
How do we move customers from cheques and cards to ACH?
Terms work where persuasion does not. Offer an early-pay discount for ACH that is smaller than the interchange you would otherwise pay, so you keep the difference and the customer gets a genuine benefit. Make ACH the default on new trade account applications rather than an option to opt into. For predictable repeat volume, autopay removes the collection step entirely.
Updated September 30, 2026
Underwriting
How are B2B merchants underwritten?
Underwriting assesses the processor's exposure if you fail to deliver what a customer paid for. In B2B the factors that matter most are financial strength, average and maximum ticket size, customer concentration, the gap between payment and delivery, and dispute and refund history. Retail-oriented factors like chargeback ratio matter less; delivery risk matters more, because the amounts are larger and the delivery windows longer.
Updated September 30, 2026