Level 2 and Level 3 Credit Card Processing


Credit card processing can be bucketed into three different levels: Level 1, Level 2, and Level 3. As you go up levels, your business is required to add more information in order to process a transaction. Typically, most businesses can stay at Level 1, however, depending on the type of cards you take, the amount you are processing, and the information you need to gather in order to secure a transaction, you might qualify for a higher level. This includes Level 2 credit card processing and Level 3 credit card processing.

Understanding How Level 2 and Level 3 Credit Card Processing Works


Level 2 credit card processing works similar to Level 1 credit card processing. However, the higher the levels you go when accepting payments, the more information is required in order to process. With Level 1, card data is typically associated with consumer transactions.
With Level 2, you’re most likely a B2B or corporate business that requires information such as customer codes, tax amount, tax identification, and more.
With Level 3 credit card processing, you’ll need all the same information as Level 1 and Level 2, with an additional capture of specific line item data. That data includes invoice numbers, tax amounts, item descriptions, and more.

Frequently Asked Questions About Level 2 and Level 3 Credit Card Processing


Who qualifies for Level 2 and Level 3 Credit Card Processing?
While most merchants and businesses align with Level 1 processing requirements, there are certain types of businesses who can benefit from Level 2 and Level 3 processing. While this is not an exhaustive listing, businesses that fall into one of the categories below typically qualify:
  • B2B
  • Corporate
  • Enterprise
  • Commercial
  • Purchasing
  • Government

Is there an extra cost with Level 2 and Level 3 transactions?
Not usually. Often, Level 2 and Level 3 card data qualifies for lower interchange rates with Visa and MasterCard.
How do I submit these types of  transactions?
Merchants and businesses submit Level 2 and Level 3 transactions using retail, MOTO, eCommerce, virtual terminals, and payment gateways.
What information is needed to process a transaction?
In order to process a transaction for either Level 2 or Level 3, you might be asked for the following information:
Level 2
  • Credit Card Number
  • Expiration Date
  • Billing Address
  • Zip Code
  • Invoice Number
  • Customer Code (sometimes referred to as a Purchase Order number)
  • Sales Tax

Level 3 - Sample of potential required information. Speak to one of our payment specialists to learn more.
  • Transaction Amount
  • Date
  • Tax Amount
  • Customer Code (sometimes referred to as a Purchase Order number)
  • Zip Code
  • Merchant Minority Code
  • Merchant State Code
  • Ship From Postal Code
  • Destination Postal Code
  • Invoice Number
  • Order Number
  • Specific item information such as: product or commodity code, description, or quantity
Are Level 2 and Level 3 transactions secure? 
Level 2 and Level 3 credit card processing are just as safe and secure. In fact, they are typically more secure because they require an extra level of information in order to process the transaction. This reduces any potential fraud or chargebacks to your business.

Learn More about our Credit Card Processing Services