Interchange has always shaped how suppliers view card payments. A small change in the rate can move margins, and for commercial transactions, those margins matter. Visa’s Commercial Enhanced Data Program, or CEDP, introduces one of the most sweeping changes to interchange qualification in decades. It connects lower interchange rates directly to the accuracy and transparency of the transaction data that suppliers submit.
Dean M. Leavitt, founder and CEO of Boost Payment Solutions, told PYMNTS’ Karen Webster that CEDP is designed to clean up years of inconsistent practices. “For quite a bit of time since level three and level two have been introduced [the data programs for commercial card transactions], there were concerns about the quality of the data that was submitted with transactions,” he said. “A lot of players in the industry were what’s commonly referred to as stuffing data, meaning they were putting erroneous data into the fields that would otherwise qualify the transactions for the lowest possible interchange rate.”
CEDP, he explained, now requires suppliers or their agents to submit actual data, essentially from the invoice that the supplier sent to their customer.
That information must flow into Visa’s system exactly as it appears on the invoice. “This is all about validating the data and making sure that it’s accurate and real so that the supplier can enjoy the lower interchange rate,” Leavitt said.
The program, which took effect Oct. 17, also changes how compliance is enforced. “Suppliers are treated as guilty before being proven innocent,” Leavitt said. “You have to prove that your transactions are verified.”
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Those that do not may pay roughly a full percentage point more in interchange than verified suppliers. For those who meet the standard, the incentive is clear.
“If you do send in qualified transactions the correct way, the interchange rate is actually 15 basis points lower than the current level three rates,” he said. Visa has also added a small assessment increase, so “the net result to suppliers that are submitting verified transactions is a 10-basis-point reduction in their interchange fee.”
The Role of AI
Preparing for CEDP has also been a technical challenge. Boost has used generative artificial intelligence (AI) tools to help parse and reorganize invoice data and to automate checks on transaction accuracy.
“We are using AI in a variety of different ways, and we have deployed it for this CEDP initiative,” he said. “We use AI to check other AI within our organization. It’s kind of AI checking AI.”
AI’s role will only grow. Leavitt said it will reduce manual work tied to exceptions, accelerate speed to market for new products, and improve accuracy in large enterprise payments where a single transaction can include thousands of invoice lines.
“By utilizing AI, you could really meaningfully reduce the work associated with those exceptions,” he said.
The change has created urgency across the commercial payments ecosystem. Webster asked how ready suppliers and their partners are for the new requirements. Leavitt said readiness varies widely. “We’ll know over the next month or two who has been doing what needs to be done to get ready for this,” he said. Some acquirers, processors, and FinTech facilitators have spent months preparing, while others, he noted, are “very concerned about their readiness.”
On the supplier side, readiness involves more than technology. Visa’s own AI and machine learning systems will review transaction data after the fact and may issue rebates if transactions later qualify for the lower rate. “You may receive a payment, pay a much higher interchange rate, and then get a rebate after the fact,” Leavitt said. “Depending on how you account for the cost of these card-based transactions, that can create reconciliation issues.”
Boost designed its platform to remove that problem. “We’ve made sure that all of our transactions process in a fully verified way,” Leavitt said. “We are going to pay suppliers and charge them the interchange rate as if all of their transactions are in fact verified. There’s no reconciliation issue and there’s no rebate down the road.” He added that this “prefunded” approach forwards funds on the assumption that transactions will be verified, allowing suppliers to see the benefit immediately rather than weeks later.
Verifying the Data
Leavitt said Boost’s prequalification efforts are comprised of two layers. “The supplier needs to be verified and the transactions need to be verified,” he explained to Webster. When Visa recognizes a supplier that receives transactions in a verified way, “any payments made to them will be treated as verified, and they will be entitled to that lower CEDP rate.”
Boost’s world is buyer-initiated payments. “All of our payments are initiated by a buyer who has received and reviewed and approved an invoice, and then somebody in AP [accounts payable] hits that button that triggers the transaction to flow through us to the supplier via straight-through processing,” he said.
Because the data comes directly from the buyer’s approved invoice, “every single one of the transactions that we facilitate takes the accurate data that the buyer has given to us, pretty much off their invoice, and we then process that transaction the way Visa has prescribed it.” Boost’s testing shows nearly a 100% verification rate, giving the company confidence to guarantee the lowest rate.
Webster noted that this flips the usual risk assumption. Leavitt agreed. “Our view is you are innocent until proven otherwise,” he said. “Any transaction processed through us is going to pay the lowest CEDP rate because we have confidence that those transactions will be verified by Visa.”
Leavitt views CEDP as part of a broader acknowledgment that commercial transactions differ from consumer payments and deserve a right-sized rate structure. “You’re willing to offer suppliers a lower interchange rate, but it has to be done in a proper way to make sure the data is real,” he said. For suppliers and their providers, the message is clear: Get the data right, or pay for getting it wrong.
PYMNTS CEO Karen Webster is one of the world’s leading experts in payments innovation and the digital economy, advising multinational companies and sitting on boards of emerging AI, healthtech and real-time payments firms, including a non-executive director on the Sezzle board, a publicly traded BNPL provider. She founded PYMNTS.com in 2009, a top media platform covering innovation in payments, commerce and the digital economy. Webster is also the author of the NEXT newsletter and a co-founder of Market Platform Dynamics, specializing in driving and monetizing innovation across industries.
Dean M. Leavitt is the founder and CEO of Boost Payment Solutions, a technology-driven provider of B2B payment solutions that helps suppliers optimize commercial card acceptance and data compliance under Visa’s Commercial Enhanced Data Program.
