Level 2 & 3 Processing: Huge Savings for Wisconsin B2B Companies

# Level 2 and Level 3 Processing: Hidden Savings for Wisconsin B2B Companies

If you run a manufacturing plant in the Fox Valley, a wholesale distribution center in Milwaukee, or a professional service firm in Madison, you’re likely no stranger to the costs of doing business. You keep a sharp eye on your overhead, from rising utility costs to logistics. But there is one area where many Wisconsin B2B (Business-to-Business) companies are overpaying without even realizing it: Credit Card Processing Fees.

When you accept a payment from another business or a government entity, the "interchange" fees charged by card brands like Visa and Mastercard are often significantly higher than they need to be. By utilizing Level 2 and Level 3 processing, you can unlock significantly lower rates.

In this guide, we’ll break down how these savings work and how Wisconsin Electronic Payments can help you keep more of your hard-earned revenue.

What is Level 2 and Level 3 Processing?

Most retail transactions (like buying a coffee at a cafe in Door County) are "Level 1." They require basic information: the card number, expiration date, and CVV.

However, B2B and B2G (Business-to-Government) transactions are considered "higher risk" for fraud unless more data is provided. To encourage transparency, card brands offer lower interchange rates when you provide additional transaction details.

Level 2 Data: Includes details like sales tax amount and a customer-defined reference number (like a PO number).

Level 3 Data: Requires much more detail, including line-item descriptions, quantities, unit prices, product codes, and freight amounts.

Why Does This Matter for Wisconsin Businesses?

In the Badger State, our economy is built on manufacturing and supply chains. Whether you’re shipping precision parts from Waukesha or providing industrial HVAC services in Green Bay, your average transaction size is likely much higher than a typical retail shop.

When you’re processing a $5,000 or $50,000 invoice, the difference between a standard rate and a Level 3 rate can be staggering.

The Real Savings Numbers

On average, Level 3 processing can reduce your interchange costs by 0.50% to 1.10% per transaction.

Let's look at a practical Wisconsin example:

The Business: A paper packaging wholesaler in Neenah.

Monthly B2B Volume: $200,000.

Standard Rate (Level 1): 2.70% ($5,400 in fees).

Optimized Rate (Level 3): 1.85% ($3,700 in fees).

Monthly Savings: $1,700.

Annual Savings: $20,400.

That’s $20,000 back into your business—enough to upgrade equipment, hire a new part-time team member, or expand your marketing efforts.

How to Qualify for These Savings

To capture these lower rates, you need two things: the right information and the right technology.

1. Collect the Correct Data

For Level 3, you'll need to input:

Merchant Name and Zip Code

Invoice Number and PO Number

Tax Amount (and an indicator if the transaction is tax-exempt)

Line-item detail (Description, Commodity Code, Quantity, Unit of Measure)

2. Use a Gateway that Automates the Work

The biggest hurdle for many Wisconsin business owners is the time it takes to enter all that data. If your staff has to manually type 15 fields for every customer invoice, the labor cost might eat up the processing savings.

This is where Wisconsin Electronic Payments makes the difference. We provide smart payment gateways that can "auto-fill" much of this data for you. By pulling information from your ERP or accounting software, the system automatically transmits the required Level 3 data to the card brands, ensuring you get the lowest possible rate every time without the manual headache.

Is Your Business a Candidate?

If your customer base includes any of the following, you should be using Level 3 processing:

Other Businesses: Local manufacturers, construction firms, or tech startups.

Government Entities: Local school districts, municipal offices, or state agencies (very common for "Purchasing Cards" or P-Cards).

Non-Profits: Large charitable organizations.

Standard "flat-rate" processors often pocket the difference between what they charge you and the lower Level 3 rates they pay. At Wisconsin Electronic Payments, we believe those savings belong to you.

Your Local Wisconsin Partner

Navigating the complexities of interchange optimization shouldn't be your second job. As a local Wisconsin provider, we understand the specific needs of our state's B2B landscape. We don't just set you up with a terminal and disappear; we act as your long-term consultant to ensure your rates stay as low as possible as your business grows.

Get Your Free Rate Analysis

Are you leaving money on the table? Most B2B companies are. We offer a no-obligation Merchant Statement Analysis specifically for Wisconsin businesses. We will look at your current processing statements and show you exactly how much you could save by switching to a Level 2 or Level 3 optimized system.

[Contact Wisconsin Electronic Payments today for your free savings analysis and let’s keep more money in the Badger State!](#)