Accepting Purchasing cards (p-cards) from the government and Line Item Detail


                   Many government contractors and suppliers are losing a big chunk of revenue every time they process a government  purchase card (P-card) or commercial transaction without even realizing it.

 The barrage of sales solicitation from sales people promising to lower rates and save money has resulted in most suppliers and merchants have become numb when it comes to merchant services.  I can’t blame merchants for feeling this way,  most are victims of our industry and have  conditioned by sales people who only sell on rate. What’s your rate is usually one of  the first questions I receive.


I hope I don’t offend anyone but being an industry veteran, almost 20 years it really pisses me off to see where our industry is going.

Its  one of the only financial services industries that doesn’t require certification or a certain amount of required knowledge to start selling merchant services? That’s nerve shattering.


Payment professional are supposed to serve as a knowledgeable  trusted advisers and ensure government contractors and suppliers are processing properly, and continually monitoring their account to ensure transactions are clearing at the lowest interchange rates.

Unfortunately many companies only teach sales representatives what they need to know to close sales and little about the industry itself.

Credit card fees are generally in the top 5 fees for businesses. Government contractors and suppliers who invest time in learning the basics when it comes to processing fees as and Purchasing cards can make a significant impact on their bottom lines.  You will probably be more educated about the industry than most people selling merchant services.

Selling to the government or other businesses puts in a different bracket than businesses who sell to consumers. You will soon see its not all about rates, but knowing how purchase cards differ from any other type of credit card you accept. In fact, this is the only time you can accept a credit card where you have the ability to dictate your rate, based on your actions.


1st. its important to know that ALL processors operate off the same cost.  This called interchange and amounts to 70%-80% of the fees you pay to accept credit cards. Interchange  fess are actually paid to the card-issuing bank. NOT Processors. Processors see NO revenue from interchange.

No processor or bank can offer you a lower interchange fee.  The only negotiable fee is the processors markup, which can consist of discount fee, transactions and monthly fees etc.,

This is why have a cost plus or pass through pricing merchant account is so important.  It allows you to easily see the processors markup as well as compare offers from other processors.

If you have Non-Qualified listed on your statement you need to Fire Your Processor Right Away.

If you look at your processing statement will see All of your government and commercial cards will be automatically downgrading to Non-Qualified.



 What EVERY Government Contractor and Supplier Needs To Know About Purchasing Cards, but  Probably Never Told!



MasterCard and Visa have created special interchange rates to encourage supplier participation and support of Purchase Card programs by reducing the supplier’s transaction costs IF Level-3 line item detail information is transmitted with the transaction.



The key word here is IF


Even t the GSA website and says Level 3 and a cost plus merchant account may reduce a suppliers processing expenses by 30%-40%.

What does this mean?

Visa and MasterCard have special Interchange  Rates for suppliers IF Level 3 Data is provided which can save 30%-40%. Remember, Interchange goes back to the card issuing bank, NOT processors.  Your processor does have to have you set up correctly and requires technology about to support Level 3, but you can see suppliers have an opportunity to reduce rates on P-cards by up to 40% and Does NOT come from their processor.

Savings can be increased for transactions over $5,100 with High Ticket Interchange.


Many supplies are already set up and processing Level 3 Data.   4 out of 5 suppliers I talk with who are processing Level 3 are leaving a lot of revenue on the table from not being set up properly from their processor.

In closing I am available to answer any questions. This was is a general overview and left out a lot of pertinent information. I was trying to prove the fact that most suppliers are losing a big chunk of revenue that could be going back into their pocket.



Some that read this may be inclined to share this  information to their processor but remember this. If they had your best interest at heart or knew this information and how to do this it would have been done.

They should actually give you a refund for every commercial and government card you’ve processed since your paying 30% more in fees.


Revolution Payment Systems is a leading advocate and Level 3 Payment Processor for Government Contractors and Suppliers with 20 years experience serving the B2G and B2B space.  You can reach us at 888 790 3450 or email [email protected]


PS. Not processing Level 3 could be resulting in lost government business to your competitors.  Call me to find out why.

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