The GSA site has some great information regarding Level 3 processing and benefits/Additional revenue available to
Government Vendors and Contractors.
The following information is provided for informational purposes only to provide technical background
information on the Point of Sale & Transactional Data initiative to vendors.
• Level-3 “transactional” Data: is an “electronic invoice” with line-item details. It defines “what” is
being purchased, “’how” the sales takes place, “who” is involved in the transaction, and “when” it takes
place, it combines that information with the basic payment data and delivers it electronically to the
• Level-3 line item detail provides data elements such as a description of the product, quantity, unitof-
measure, price, price discount applied and sales tax information when applicable. It adds
transparency and accountability to the taxpayer’s money spending process.
• These data elements are combined with basic transaction information such as the merchant
establishment information and cardholder information.
Value Proposition for Vendors:
• Faster funding: Improves profitability by reducing payment time from 30-45 days on an invoice to 2-3
days for electronic payment. Faster payments reduce your cost of floating funds until payments are
• Savings – MasterCard and Visa have created special rates to support Purchase Card programs
reducing the merchant transaction costs (Interchange) if Level-3 line item detail information is
transmitted with the card payment file. By providing Level-3 data, a supplier may reduce their credit
card processing fees – often by 30% to 40%.
• NOTE: The examples below show the “Wholesale” Cost from Visa and MasterCard
(Interchange) to the Acquiring Banks. The true cost to the Vendors/Merchants will be higher because
they will include additional charges from the Bank and/or Independent Agents servicing their
merchant processing accounts. Most independent sales agents work on commissions or “residual
• SUGGESTION: Vendors should ask their merchant processor for a pricing model which shows
the true interchange cost, plus a constant profit margin (sometimes called “Interchange Plus”, or
“Pass-Through Plus” by the Processors).
• Example #1, Visa Interchange Exercise:
Cost for a $5000 Visa transaction without Level 3 Data: $139 or 2.78%
Cost for a $5000 Visa transaction with Level 3 Data: $99 or 1.98%
Cost for a $3000 Visa transaction without Level 3 Data: $99 or 3.30%
Cost for a $3000 Visa transaction with Level 3 Data: $75 or 2.50%
• Example #2, MasterCard Interchange Exercise:
Cost for a $5000 MasterCard transaction without Level 3 Data: $147.50, or 2.95%
Cost for a $5000 MasterCard transaction with Level 3 Data: $102.50, or 2.05%
Cost for a $3000 MasterCard transaction without Level 3 Data: $88.60, or 2.95%
Cost for a $3000 MasterCard transaction with Level 3 Data: 77.58%, or 2.58%
You can see in the examples above, including level 3 payment detail AKA line item detail can lower the cost of accepting
credit cards from the government and businesses by 30%-40%. This happens before credit card processors add their markup to your
For more information give us a call at 888 790 3450 or email [email protected]
You can also visa the GSA Site HERE