Optimizing B2B payments with credit card solutions

Whether you’re an emerging start-up or an established enterprise, the right B2B payments processing system may mean the difference between surviving and thriving. Now that credit cards are the leading form of payment, a B2B processing system with credit card solutions is an operational essential. 

Here’s what your business may stand to gain from using a B2B payment processing system with credit card solutions.

Advantages of B2B payments processing systems with credit card solutions

1. Expanded processing (reducing risks and costs)

When it comes to credit card payment processing, the needs of businesses and corporations differ significantly from those of typical consumers. While consumer credit card processing usually involves straightforward transactions with limited shared data, corporate and business payment systems are designed to handle more complex data transfers, requiring faster, more secure interchanges—especially for level 2 and level 3 corporate cards.

Here’s a need-to-know summary of card levels:

Level 1 card data is the most basic level and is mostly associated with business-to-consumer (B2C) transactions. At this level, the information collected is fairly simple—card number, expiration date, CVV code, and maybe a zip code. For cardholders, it provides limited purchase details to their bank, which works well for everyday consumer transactions.

At Level 2, data collected includes the same information as Level 1, plus additional data fields like customer codes, tax amounts, tax identifications, and other data. These extra data points are helpful for corporate and government buyers because they allow for better tracking and analysis of spending. Plus, they come with a financial perk: optimized interchange rates, which can lower processing costs.

Level 3 transactions offer even more control. This is the B2B option mostly used by merchants who work with government agencies or very large corporations. Level 3 requires users to provide more data with each purchase, including line-item details like item descriptions, quantities, and freight amounts. 

While providing this additional information may seem like extra or even superfluous work, it’s actually incredibly useful. The additional transactional data provided minimizes the risk of fraud significantly. What’s more, credit card companies often offer lower interchange fees in exchange for the additional information passed through on higher level transactions, potentially saving your business money. Further, accepting payments at these levels opens the door to working with larger businesses, corporations, and even governmental agencies who require Level 2 and Level 3 processing.

2. Seamless integration with operations systems

One major advantage of a B2B payment processing system with a credit card solution is its potential for integration. Integrating B2B credit card processing with your current accounting, Enterprise Resource Planning (ERP), or Customer Relationship Management (CRM) software can save you time and may even reduce errors by simplifying reconciliation and eliminating redundant data entry. You can say goodbye to manual invoicing or recording and hello to a leaner, more integrated payment management and reconciliation.

Even better, credit cards lend themselves to payment integration. And, with integrated B2B payment processing, it’s possible to automatically sync all of your sales data with your accounting, CRM, and ERP platforms. Without this integration, checks and money orders may have to be processed manually.

READ: How to declutter your small business operations

3. Increased security features

Credit card payments can be significantly safer than debit cards, eChecks, and even ACH payments. With credit card payments, both sides of a credit card transaction have various protections, depending on the card issuers, of course. Most credit card issuers also offer features that aim to prevent fraud such as virtual card numbers, card locks, and free credit reporting.

There are other ways to ensure B2B transactions are secure. For instance, when choosing a merchant account provider for your B2B payment needs, ensure it offers the highest level of data security in the payments industry, including:

• Point-to-Point Encryption (P2PE)
• Tokenization
• Fraud filters

You can also protect your customer’s sensitive payment data by using PCI-compliant business-to-business credit card processing.

READ: How to upgrade our small business cybersecurity

4. Business-preferred payment method

One survey conducted on business leaders reports a whopping 44% charge more than half of their total spending to credit cards. Why? Convenience. Of the business leaders surveyed that use credit cards, over 50% admit it’s due to the sheer speed and convenience a credit card offers. 

The truth is, credit cards offer a safe and convenient way to make business purchases. And, it’s likely that many of your business customers prefer paying with credit cards—especially small businesses and startups. Not accepting credit cards could put you at risk for missing out on opportunities to work with a wider variety of businesses, up your revenue, and build working relationships with other businesses. 

5. Faster payment method 

Credit card transactions typically clear faster than other payment solutions, giving you quicker access to your hard-earned funds. This can be a huge advantage if cash flow is a concern or unexpected payment delays block up important projects within your pipeline. No need to wait long, grueling business days before having access to your well-deserved revenue. 

READ: How to manage irregular overhead and cash flows

Reaping the benefits of accepting B2B credit card payments begins with selecting the right POS system for your business. With features such as invoicing, recurring payments, and inventory management, Clover’s point-of-sale systems can help make B2B payments easier.

Already have a Clover POS System?  Learn how business-to-business credit card processing solutions can help you increase sales, reduce costs, and eliminate fraud, contact our merchant services team today.

Image designed by Freepik.com

Editorial Team

Insights, Payments & processing, Run your business

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