As a government contractor, you’ve invested significant time and energy in winning government contracts. Now, with a contract in hand, do you know how to accept government purchase cards while maximizing your earnings?
Government contracts can be lucrative, but few contractors are informed on the most cost-effective ways to handle government credit card payments. Many don’t realize that Visa and MasterCard offer special incentive rates for contractors who meet certain processing requirements, which can lower transaction costs by 1%-1.5%, regardless of the processor’s rate. These programs have existed for over 20 years, yet 3 out of 5 contractors aren’t taking full advantage of these savings.
Due to the unique challenges contractors face, many have defaulted to basic setups provided by their bank. Unfortunately, many processors and banks lack expertise in government contracting and fail to guide contractors toward solutions could significantly cut their costs.
Level III line-item detail entry—created to enhance purchase card programs—can lower the discount rate by up to 1.5%, depending on the card type and transaction amount. By incorporating Level III processing, contractors not only benefit from lower fees but also help buyers better manage their purchase card programs. In additional to the level 3 processing savings, if you accept a government card $5557.14 or above, you are eligible for interchange rates of 1.2%.
While credit card fees are part of doing business, understanding credit card processing fees and rate structures that impact your bottom line enables you to make better business decisions. Leveraging the right setup could mean the difference between just doing business and maximizing your profits on every government transactions.
Got questions? We’re here to help! Contact us at (888) 790-3450 or info @revolution-payments.com.