Commercial card interchange, without the jargon.

Commercial card interchange is the fee the card networks set for payments made with cards issued to businesses and government agencies, and it is paid to the bank that issued the card. It is generally higher than interchange on standard consumer cards, but sending complete Level 2 or Level 3 data and taking the card the right way can move many commercial payments into lower categories.

Interchange is the same for every processor. What differs is whether your setup lets payments qualify for the better categories, and whether your pricing passes that benefit through to you. If interchange itself is new to you, start with what is interchange.

Which cards count as commercial

Card brands group cards by who they are issued to and how they are used. The commercial family usually includes:

Card type	Who uses it	Typical purchases
Business or small-business card	Owners of smaller companies	Supplies, travel, services
Corporate card	Employees of larger companies	Travel and expenses
Purchasing card (p-card)	Purchasing staff and departments	Goods and services from suppliers
Fleet card	Companies with vehicles	Fuel and vehicle maintenance
Government card	Agencies and public bodies	Purchasing and travel

The card’s own data tells the network which type it is. You don’t choose the category. You influence it through what you send and how you take the payment.

Why commercial cards cost more to accept

Commercial card programs give the buyer’s company things a consumer card doesn’t: spending limits, detailed reporting, longer payment terms and, in some programs, rebates. Interchange helps fund those programs, so the seller’s cost is often higher on a commercial card than on a regular consumer card of the same amount.

The networks also want detailed purchase data, because that data is what makes commercial programs useful. So they price payments with full data more favorably than payments without it. That trade is the heart of B2B card pricing.

What interchange is not

Interchange is only one of three parts of a card payment’s cost. The card networks also charge assessment fees, which are passed through at cost on a transparent statement. The third part is your processor’s margin. When a B2B seller says “commercial cards are expensive”, it helps to know which of the three is doing the damage. Interchange can only be managed through better data and entry methods. The processor’s margin can be compared, negotiated and, with the right partner, fixed in writing.

What moves a commercial payment between categories

Each card brand publishes its own tables, and they change from time to time. The factors that tend to matter are consistent, though:

• Data level. A payment with Level 1 data only can land in a higher category than the same payment with valid Level 2 or Level 3 data. See Level 2 and Level 3 data.
• Data quality. Card brands check enhanced data. Placeholder tax amounts or generic line items can disqualify a payment.
• Card present or not. Keyed and online payments generally carry more risk, and that shows in the category.
• Ticket size. Some brands have large-ticket categories for big commercial purchases, with their own requirements.
• Settlement timing. Batches that settle late can lose a better category. Close your batch daily.
• Merchant category. Your business type, as set up on your account, can affect which tables apply.

Card-brand programs for commercial data are updated from time to time, including a recent Visa program for commercial enhanced data. A setup that qualified well a few years ago is worth reviewing.

How to see it on your statement

On an Interchange-Plus statement, each interchange category usually appears on its own line with a name that hints at the card and data level. Look for:

1. Category names that mention business, corporate, purchasing or commercial cards.
2. Whether those lines mention Level 2, Level 3 or data rates, or say “standard” or “non-qualified”.
3. How many dollars sit in each, and whether the expensive categories are a large share of your commercial volume.

On tiered or bundled pricing, the interchange categories may be hidden behind three buckets such as qualified, mid-qualified and non-qualified. That makes it hard to tell whether better data would help, and it means any improvement might stay with the processor. Our guide on Interchange-Plus vs. flat-rate vs. tiered explains why that matters.

Practical steps for B2B sellers

You don’t need to memorize the tables. A short list covers most of the gains:

• Make sure your gateway or terminal is set to send Level 2 and Level 3 fields, and that the fields are filled with real order data.
• Pull order data from the system that holds it, such as an ERP or QuickBooks, rather than retyping it.
• Settle batches every day.
• Offer ACH for very large invoices. See ACH vs. credit card for invoices.
• Get on a pricing model that shows interchange line by line, so you can see the result.

For the broader picture of taking cards from business buyers, read accepting cards B2B.

What PayZoom does

We read one recent statement, sort your commercial card volume by category and tell you plainly whether better data would change anything. If it would, we set up Level 2 and Level 3 processing through your gateway, terminal or a connection to SAP or QuickBooks, and we keep track of card-brand program changes for our merchants. We recommend Interchange-Plus, where interchange passes through at cost and our margin never increases, in writing. We won’t promise a savings number before we see your statement.