Level 2 and 3 Interchange Optimization: What It Is and Why It’s Probably Costing You More Than You Think
f your business accepts commercial or government credit cards, there’s a good chance you’re leaving money on the table. The reason? You’re probably not qualifying for Level 2 or Level 3 interchange rates.
Most businesses don’t even know these levels exist—let alone how to capture them.
But they should. Because when used correctly, Level 2 and 3 optimization can dramatically lower your interchange costs without changing your processor, switching providers, or negotiating new terms.
So what is it?
When a transaction runs through the card networks (Visa, Mastercard, etc.), the processor applies an interchange rate based on risk and data quality. The more detail you submit with the transaction—especially for business and government cards—the lower the risk, and the better the rate.
There are three levels:
Level 1 – Basic data (amount, date, merchant info)
Level 2 – Adds tax amount, customer code, and merchant zip
Level 3 – Adds line-item details, product codes, quantities, freight, and more
Level 3 rates are the lowest, but you only get them if your system submits all the required data, consistently and correctly.
Why this matters
Here’s a real-world example:
A B2B distributor accepts dozens of commercial card payments each month. On average, those cards cost 2.65% per transaction. With Level 2 and 3 data submitted, that cost can drop to 1.85% or lower.
That 0.80% difference? On $500,000 in monthly card volume, it’s a savings of $4,000 every single month.
Most merchants never see that benefit because:
Their system doesn’t pass the data
Their gateway isn’t configured properly
Their processor doesn’t explain how to qualify
And that’s where we come in.
How PlutosPay helps
We act as your payments office. That means:
We audit your current setup to see if you’re missing Level 2/3 qualification opportunities
We configure your gateway or recommend one that can support the right data fields
We train your team to submit the right inputs if needed
We monitor and review your processing statements to ensure you're getting the rates you qualified for
You don’t need to switch processors or overcomplicate things. You just need someone who knows how the backend works—and who’s working in your interest.
If your business processes commercial or government cards, or operates in B2B, wholesale, or distribution, let’s take a look at your setup. Most of the time, we can help you reduce costs without changing a thing about how you sell.
Closing Thought:
You shouldn’t have to overpay just because your system didn’t check a box. Level 2 and 3 optimization is one of the simplest ways to reduce processing costs—if you know how to capture it.
That’s what we’re here for.