Industry insights Read time : 3 minutes

Automatic Level III Processing: Add more value with a single gateway

It no longer takes time, effort and sacrificing customer experiences to get lower processing rates.

If your merchants could pay less in payment processing fees, they would – unless qualifying for lower fees was time-consuming, and the process could negatively impact good customer experiences. That’s the position where many Level III merchants find themselves. Level III processing, especially for business-to-business (B2B) and business-to-government (B2G) transactions, can represent significant savings if merchants provide required data, but the process of submitting that data has a downside that can outweigh the cost savings.

The Data that Upgrades Transactions to Level III Processing

Level III processing requires more detailed data, a lot of which merchants might not even know what it means. This information can include freight or shipping costs, product details such as SKU or other identifier, quantity, unit of measure, and other data, when applicable, such as duty, expiration date, invoice or purchase order number, commodity code and discounts.

For card-not-present sales, the merchant or the customer would have to enter additional information so that the transaction could be processed at a lower Level III rate. Meeting requirements could mean payment experiences that are more time-consuming and, perhaps, frustrating for employees and customers.

Some have tried to use multiple payment gateways in an attempt to verticalize their offerings for their B2B and B2G merchants to qualify for Level III processing more easily while still providing all the payments functionality they need. Instead of solving the problem, however, this strategy often creates new ones due to added complexity and effort to maintain multiple platforms. Two gateways means keeping up to date with two merchant onboarding procedures, two teams of relationship managers, and two different response codes. providing multiple gateways leads to wasted time and resources when one full-featured gateway is really all you need.

The Solution: Automatic Level III

NMI now offers the most comprehensive solution that Level III merchants are looking for: Automatic Level III. Using the NMI portal, merchants can easily set up the data required for Level III processing. The merchant can enter information for fields that are the same for each transaction and leverage dynamic fields for data that changes, such as PO number or date of sale.

Once Automatic Level III is configured, it will apply to all of the merchant’s card-not-present transactions, whether through NMI or a third party, even if that software doesn’t support Level III. Without any additional effort, merchants will receive the best processing rates on:

  • E-commerce transactions via our Collect Checkout payment form or our inline SAQ-A- compliant iframe solution Collect.JS
  • Our mobile app iProcess (keyed card data)
  • WooCommerce, Quick-click, or any other e-commerce shopping carts
  • QuickBooks SyncPay
  • MOTO transactions through Virtual Terminal
  • Recurring subscriptions, supported by Automatic Card Updater that keeps card data current in NMI’s token vault

Add Value to Your Solution

Automatic Level III processing is a game-changer for merchants. For high-dollar B2B or B2G sales, the difference between Level II and Level III rates can mean savings of tens or hundreds of dollars per transaction, adding up to immediate and significant savings.

Integrating your solution with a platform with Automatic Level III functionality enables your users to get the best possible rates on all of their card-not-present transactions without adding friction to payment experiences. Additionally, when you integrate with NMI, you can board all merchants from a single gateway that works across a wide range of verticals, processors, and gateway connections.

For more information on how easy it is for NMI merchants to set up Automatic Level III, watch the brief video below.

NMI Team