These days, organizations conduct business in a very different way than they used to do. Credit cards are the name of the game, as they allow companies to circumvent cash flow issues and take advantage of rewards programs.

For this reason, the vast majority of B2B organizations now take credit cards for payments. Some businesses still use cash or checks, but it’s clear that digital B2B solutions will only get more popular from now on. They allow companies to receive, make, and process payments faster while providing more benefits.

That said, not all credit card transactions are cut from the same cloth. Read on to find out whether your business is processing these transactions in the most effective way.

Credit Card Data Levels

There are three data levels for credit card transactions: Level 1, Level 2, and Level 3. Each of these levels requires some amount of data to process transactions. The two higher levels require more data but tend to come with lower interchange rates as well.

For B2C companies, Level 1 data processing should be sufficient. If you run a B2B operation, though, you’ll likely need to invest in Level 2 processing. This depends on factors such as the type of cards you accept, the quantity of transactions, and the amount of data you need to gather to secure the transactions.

What Is Level 2 Data?

With Level 2 data, merchants need to provide the following information for each transaction:

• Merchant name

• Transaction amount

• Transaction date

• Sales tax amount

• Customer code

• Merchant postal code

To process Level 2 transactions, you’ll need either a standalone credit card terminal or a gateway that can handle Level 2 data. Both of these devices auto-fill the data fields required to comply with Level 2 processing. By setting up these tools, you’ll automatically comply with the data levels, making the transaction process simple and efficient.

Benefits of Level 2 Payments

For businesses taking the card, Level 2 payments will result in lower interchange costs than Level 1 payments, lowering your overall processing fees. In some places and with certain cards, Level 2 B2B payments will also receive better pricing.

For businesses using the card, Level 2 payments provide more details on transactions conducted by employees. This makes budget spending and management more effective. Other benefits from card brands may also apply, including emergency cash advances, corporate trip planning, rental car insurance, global medical assistance, and so on.