Credit card processing does not come as a simple yes/no proposition. Depending on who your customers are and what kinds of transactions they complete with you, you may need the ability to collect more line item details than are provided by the basic level 1 processing. This is especially true for B2B transactions, which benefit greatly from level 3 processing.
Information Included in Level 3 Processing
The level of transaction processing indicates what data needs to be collected from a card transaction. At level 3, you collect the most customer data. If you have corporate or government clients, this is likely a requirement for you to be able to take payments and do business. Beyond the customer name and address information, your system will need to be able to collect the following:
- Ship-to zip code
- Ship-to country
- Product name
- Product quantity
- Product price
- Product description
Security Advantages of Level 3
All of this information creates an additional layer of security for you and your customers. It allows tracking of the items purchased, so if there is a problem in the chain of custody from purchase to delivery, you or the customer can find it. This results in more peace of mind for your customers and less risk of chargebacks for you.
Benefits You Will See
One benefit to taking level 3 card transactions comes with the breadth of opportunity you can take. Government and corporate contracts can bring in steady, voluminous sales and revenues for your company, but you have to have the processing in place to run each transaction. Enabling level 3 processing can be a powerful difference maker for your business.
Beyond this, you gain a benefit of reduced per-transaction fees for level 3 processing. Credit and debit card processing pricing gets based in part on the risk of chargebacks and fraud on the transactions you run. Just as some kinds of businesses get classified as high risk and therefore pay more for payment processing, transactions that collect the most information on customers and their sales are classified at the lowest risk level. This means lower fees and more of your sales revenue reaching your bottom line.
Not everyone has to process level 3 transactions. Still, by giving yourself the ability to run these, you open up greater revenue potential with a wider range of potential customers. If you have a product or service from which large customers can benefit, it is essential for you to gain level 3 processing ability.