Commercial standard is a set of Visa interchange categories that indicate a business was penalized with more expensive rates to accept certain cards.
When accepting a credit card, there will be a “target” interchange category for each transaction. But if the transaction doesn’t meet the requirements for that category, it will “downgrade” to a more expensive category. For commercial credit cards, “Standard” is that downgrade.
The Commercial Standard downgrade category applies to all commercial cards, including business, corporate, and purchasing cards, regardless of whether they’re credit, debit, or prepaid cards.
- Commercial Standard Interchange Rates
- Commercial Standard Interchange Requirements
- Understanding Commercial Interchange
- Commercial Standard on Statements
Commercial Standard Interchange Rates
Visa publishes the rates for all its interchange fee categories. The following interchange fees come directly from the Visa interchange table.
|Volume Rate||Per-Transaction Fee|
|Purchasing Card Standard||2.95%||$0.10|
|Business Card Standard – Spend Tier 1||2.95%||$0.20|
|Business Card Standard – Spend Tier 2||2.95%||$0.20|
|Business Card Standard – Spend Tier 3||2.95%||$0.20|
|Business Card Standard – Spend Tier 4||2.95%||$0.25|
|Corporate Card Standard||2.95%||$0.10|
|Commercial Card Standard – Business Debit||2.95%||$0.10|
|Commercial Card Standard – Business Prepaid||2.95%||$0.10|
Rates subject to change.
As you can see, the rate is the same across all categories; only the per-transaction fee changes. In the “criteria” section below, we’ll take a look at when these categories will apply to commercial transactions.
Business Card Standard Spend Tiers
Visa splits business card interchange by the spending limit of the card. Currently, the spending limits break down as follows:
- Spend Tier 1: $0 – $19,999.99
- Spend Tier 2: $20,000 – $39,999.99
- Spend Tier 3: $40,000 – $99,999.99
- Spend Tier 4: $100,000 and up
Commercial Standard Interchange Requirements
It’s a bit misleading to call the criteria “requirements” as Standard interchange applies when you haven’t met requirements for other categories. However, for simplicity’s sake, we’ll call it requirements to qualify.
For commercial standard interchange, the transaction:
- Does not meet CPS requirements
- Does not pass enhanced data
Visa’s CPS (custom payment service) program lays out criteria for certain “CPS” interchange categories. Meeting CPS criteria means the transaction is “CPS qualified.” Transactions that fall to Standard did not meet CPS criteria.
Additionally, the transaction did not provide level 2 or level 3 data, meaning it was not eligible for enhanced data interchange.
There are no business type restrictions for commercial standard interchange. Any business that accepts a commercial card (including corporate cards, purchasing cards, and business cards) can “downgrade” to commercial standard.
Lastly, any type of commercial card can be subject to the Standard downgrade. That includes corporate, purchasing, and business credit, debit, and prepaid cards.
Understanding Commercial Interchange
Commercial card interchange is a little different than consumer card interchange. For one thing, commercial cards are eligible for lower costs if you provide extra information that normally isn’t included, like a purchase order number and tax rate.
If you don’t supply the extra information (called “enhanced data” or level 2 / level 3 data) you won’t receive the lower rates. However, that’s different than receiving penalty “downgrade” rates.
Think of it this way: If you only provide the basics for a commercial transaction, you’ll hit the “target” or base interchange qualification. Those rates will be the middle of the road cost for that transaction.
If you provide level 2 or level 3 data, you can hit “enhanced” interchange. Those rates are the best (least expensive) you can pay for that transaction.
If you don’t provide level 2 or level 3 data AND you fail to meet the basic requirements for “target” interchange, you’ll “downgrade” to the Standard interchange category. Those rates are the worst (most expensive) you could pay for that transactions.
This concept is summed up in this diagram:
As you can see, “target” interchange is neither an enhancement nor a punishment. But choosing to provide more info can result in enhanced interchange qualification, meaning lower costs. By contrast, not meeting requirements for “target” interchange can result in a downgrade, meaning higher costs.
Do I need to provide enhanced data?
If you accept a lot of commercial cards, it’s in your best interest to qualify for enhanced data rates. But even if you can’t / don’t want to take steps to provide enhanced data, you’ll want to ensure you’re not receiving lots of downgrades. That indicates you’re essentially paying a penalty rate.
CardFellow members can get assistance with interchange qualification and downgrade correction by contacting us for your free audit. You can also become a CardFellow member for free if you aren’t already.
Commercial Standard on Statements
You can usually identify Standard interchange on statements. Many processors provide statements that include a section for “interchange detail.” That will list the categories that applied to your transactions for the month.
However, flat rate processing companies (such as PayPal, Square, Stripe, and others) don’t list interchange for you. You will not be able to see which individual interchange categories applied.
Different processors use different terms or abbreviations for interchange categories. Some of the ones you might see for Commercial Standard include:
- STND PURCH
- STND BUS
- STND CORP
- STND BUSDB
The first three refer to commercial credit cards while the last two are debit and prepaid. However, this is not a complete list of all possible aliases.