Unexpected cost savings may be hiding in your payment strategy

Many business leaders are examining their organizations for ways to reduce costs and free-up cash for strategic investments. In a 2025 Deloitte survey, 70% of companies said they planned to cut costs, and nearly one-third rated cost savings as their top priority.

The challenge for financial professionals is to find quick, effective ways to cut costs that deliver value in months, not years. An unexpected and simple opportunity lies within their payment strategy. For many companies, credit card acceptance fees are the second-highest expense after labor, so lowering them can make a big difference. Payment optimization helps companies reduce costs and reinvest savings in technology and resources to meet evolving customer needs, address security concerns, and manage supply chain challenges.

With little to no investment and minimal disruption to business operations, companies can rapidly implement Payment Optimization Solutions that lower or offset card acceptance costs.

Reduce costs on B2B transactions

Businesses and government agencies that accept a large volume of commercial card transactions can reduce related expense through Commercial Card Optimization. Commercial cards include business cards, fleet, corporate, and purchase cards. While business-to-business (B2B) companies and government agencies are natural fits for the program, any company providing goods and services to vendors, partners, contractors, and service providers can benefit.

For example, U.S. Bank collaborates with consumer retail and service firms, universities, and non-profits to help them save significantly by optimizing their commercial card payments. These payments are among the costliest due to higher interchange fees, and acceptance costs increase as usage grows. The good news is that these costs can be effectively managed with Commercial Card Optimization (CCO).

Our managed Commercial Card Optimization enables companies of all sizes to easily transmit Level 2 and Level 3 transaction data, helping qualify commercial card payments for lower interchange rates as established by Visa and Mastercard. Additionally, our CCO program removes the costs and complexity of using a third-party Level 2 and 3 gateway.

In October 2025, Visa introduced a new Commercial Enhanced Data Program (CEDP) that uses machine learning to check the quality of transaction data flowing through the Visa network. Visa now validates Level 3 data and assigns a “CEDP Verified” status before a merchant's eligible transactions can qualify for lower rates. If data doesn’t meet the new criteria, transactions will default to higher interchange rates.

Additionally, as of April 2026, Visa is eliminating most Level 2 programs.

Our managed CCO program enables businesses to unlock the full cost-saving potential of each eligible transaction without creating complex manual processes that burden staff and lead to errors and missed savings. Generally, our clients have seen an average reduction of 0.15% to 1.50% in their commercial card rates, though these savings can be affected by factors such as card network rate changes. Our Payment Optimization Consultants quickly estimate cost savings based on a company’s existing payment data.

Offset costs

Fee acceptance programs help businesses, government agencies, and higher education institutions offset or lower the costs of accepting card payments. We provide three programs that let organizations add a small fee to help cover these transaction acceptance costs.

Our fee programs Include:

• Service fees for Public Sector & Higher Education
• Credit card surcharging
• Convenience fees

Fees are either at a flat rate or a percentage of the transaction amount, depending on the program and payment method. Each fee structure is governed by various card brand rules, limitations, and requirements, which is why working with a Payment Optimization Consultant is essential to find the right program for your organization. Our Payment Optimization Consultants collaborate with an experienced implementation team to ensure the proper fee program is applied in accordance with relevant card brand rules and certain state laws. Since implementing fee programs can be complicated, we handle the programming, administration, and maintenance for our clients, helping them save money with minimal disruption to their operations or customer experience.

Streamline currency conversion

A lesser-known way to better manage payment acceptance is through Dynamic Currency Conversion (DCC). Each year, tens of millions of travelers from around the world visit North America for both business and leisure. DCC helps U.S. and Canadian businesses better serve international travelers.

Before completing a purchase, DCC calculates the transaction amount and shows the total in both the cardholder’s home currency and the business’s local currency on the terminal screen. The cardholder can choose to pay in their home currency and convert the amount before submitting the transaction for authorization. If they opt to convert to their currency, the conversion is based on the current exchange rate, not the rate used by the card brand or issuer after submission.

Each receipt displays the purchase amount in the business’s local currency, the conversion rate, and the cardholder’s home currency amount. This makes it easier for international cardholders to reconcile charges when paying their card balances and reduces the chances of chargebacks from unrecognized transactions. Additionally, our DCC service allows businesses to earn a share of the conversion fee for each completed DCC transaction, creating a new revenue stream.

These are just a few ways we assist our clients in reducing expenses and managing the cost of card acceptance more effectively. We provide multiple opportunities for cost savings through Payment Optimization, which could be available to your company depending on your industry and transaction mix.

You can arrange a consultation with our Payment Optimization team by contacting your U.S. Bank relationship manager.