Level 2 and Level 3 Credit Card Processing, Explained for 2026

What are Level 2 and Level 3 credit card processing?

Level 2 and Level 3 are enhanced-data processing levels for commercial credit card transactions. Level 2 adds fields like sales tax amount, tax ID, and customer reference number on top of the standard Level 1 data. Level 3 adds full line-item detail, item description, quantity, unit price, product code, freight, duty, and destination ZIP. When the data is passed correctly, the card networks reward the merchant with lower commercial card interchange rates.

Did Visa really retire Level 2 in 2026?

Yes. Visa retired its standalone Level 2 interchange program on April 18, 2026 as part of the Commercial Enhanced Data Program (CEDP) rollout. Visa's Level 3 program was replaced by CEDP on October 18, 2025. Merchants can still submit tax data on Visa commercial transactions, but there is no longer a standalone Level 2 incentive on Visa, to qualify for the lower commercial card rates, you must submit CEDP-quality enhanced data. Mastercard still recognizes its own Level 2 and Level 3 programs.

What is the Commercial Enhanced Data Program (CEDP)?

CEDP is Visa's replacement for its old Level 3 program. It introduces a new set of "Product 3" commercial card interchange rates for verified merchants who pass invoice-quality enhanced data on commercial card transactions. The data set is similar to old Level 3, line-item detail, freight, duty, destination ZIP, but the program is governed by new compliance and data-quality requirements. Easy Pay Direct's gateway and B2B specialists are set up to qualify merchants for CEDP.

How much can I save with Level 3 / CEDP processing?

Most qualifying B2B and B2G merchants save 0.8% to 1.5% per transaction versus standard commercial card interchange rates. On B2B and B2G volume, where average tickets are large, that compounds quickly, a $500,000 / month commercial card merchant can save $48,000 to $90,000 per year by qualifying transactions correctly. The exact savings depend on card mix and ticket size; we can model your specific savings against a recent statement.

Does just passing the data guarantee I'll get the lower rate?

No. Passing the data is necessary but not sufficient. The transaction must also be settled correctly, the card must be a qualifying commercial card, the merchant must hold the right account configuration, and (for Visa) the merchant must operate under CEDP rules. Submitting bad or incomplete enhanced data can actually downgrade the transaction to a higher "standard" rate, 50 to 150 basis points more than the merchant would have paid otherwise. Setup matters.

What kind of merchant typically qualifies?

B2B and B2G merchants whose customers pay on corporate, business, purchasing, fleet, or government cards. Common examples: B2B SaaS, wholesale distribution, professional services, industrial supply, government contractors, freight and logistics, IT resellers, and enterprise software providers. If a meaningful share of your card volume is on commercial cards, you almost certainly leave money on the table by processing those transactions at Level 1.

Do I need a special gateway or virtual terminal for Level 2 / Level 3 / CEDP?

Yes. Standard retail credit card terminals and most plain-vanilla gateways cannot pass enhanced data fields. To qualify for Level 2, Level 3, or CEDP rates, you need a gateway or virtual terminal that accepts and transmits the full enhanced-data field set. Easy Pay Direct's payment gateway supports the full enhanced-data field set out of the box, with 500+ integrations for B2B billing systems.

What's the difference between Level 2 and Level 3 data?

Level 2 adds tax-level information: sales tax amount, tax ID, customer reference number, merchant postal code. Level 3 adds line-item detail on top of Level 2: item description, item quantity, unit of measure, unit price, product code, freight amount, duty amount, destination ZIP, and discount per line. Level 3 is generally required for any government purchase and for many large-ticket corporate purchases.

What cards qualify for enhanced-data interchange?

Commercial cards, business cards, corporate cards, purchasing cards, fleet cards, and government cards. Consumer credit and debit cards do not qualify for Level 2, Level 3, or CEDP interchange treatment. For Visa, enhanced-data programs apply to commercial credit cards. For Mastercard, the programs cover commercial credit, debit, and prepaid cards.

How do I get set up for Level 2, Level 3, and CEDP processing?

Apply on this page or talk to a specialist. A Certified Payment Specialist will review your card mix, place you with a payment processor that prices commercial card volume correctly, and configure your gateway / virtual terminal to pass the right enhanced-data fields for Mastercard Level 2 and Level 3 and Visa CEDP. We will run a side-by-side savings model against a recent processing statement at no charge.