Short answer: most merchants try to negotiate a better rate and stop there. However, the rate is only one of five levers, and usually not the biggest. The others are moving volume to cheaper rails, passing enhanced data on commercial transactions, routing transactions intelligently, and recovering costs through surcharging where the rules allow it. Used together in Dynamics 365, they typically beat anything a renegotiation delivers alone.

Here is what each lever does and when it applies.

First, find out what you actually pay

You cannot reduce a cost you have not measured. So start with your effective rate: total payment costs divided by total processed volume, over a full month.

That single number tells you more than any line on a statement. Meanwhile it also exposes the gap between the headline rate you were quoted and what you really pay once interchange, assessments, markup and incidental fees land.

Our guide to what you are actually paying breaks the statement down properly. Do that first, because each lever below targets a different component.

Lever 1 — Choose and change your processor

Most native Dynamics 365 payment connectors bind you to a single acquiring bank. Consequently your rate is whatever that relationship offers, and switching means a re-integration project.

A processor-agnostic connector changes the economics. You can compare processors on real traffic, move volume, or renegotiate from a position where leaving is genuinely possible.

Two points matter here. First, approval rates matter as much as fees — a cheaper processor that declines more transactions costs you more overall. Second, switching only works if your tokens are portable, which is why processor migration so often stalls.

Lever 2 — Move volume to cheaper rails

This is the lever finance teams most often overlook, and frequently the largest.

Card fees are percentage-based, so they scale with ticket size. ACH and pay-by-bank are typically flat-fee, so they do not. Therefore on a large B2B invoice the difference is not marginal — it is an order of magnitude.

You do not need to force the change. Instead, present the cheaper option prominently at the point of payment, particularly on high-value invoices. See ACH and pay-by-bank in Dynamics 365 for how to do that without hurting collection speed.

Lever 3 — Pass enhanced data on commercial transactions

If you sell B2B, this one is nearly free money and widely unused.

Commercial and purchasing cards earn lower interchange when the transaction carries line-item detail. Visa now requires Level 3 data under its Commercial Enhanced Data Program, having retired the intermediate Level 2 tier. Mastercard still uses Level 2 and Level 3.

Passing that data automatically moves qualifying transactions into better interchange categories. Consequently your effective rate falls without changing anything a customer sees. Enhanced data processing in Dynamics 365 covers the fields required and how they map from your ERP.

For B2B-heavy operations running Finance & Operations, this often produces the fastest measurable saving.

Lever 4 — Route transactions intelligently

Once several processors are available, routing becomes an economic decision rather than a fixed setting.

Least-cost routing sends each transaction to whichever connected processor offers the best economics for that card type, amount and region. Meanwhile regional routing improves approval rates, because domestic acquirers frequently approve local cards better than foreign ones do.

Both require the ability to run multiple processors at once, which single-acquirer connectors do not allow.

Lever 5 — Recover costs through surcharging

Finally, some merchants pass the cost of credit acceptance to the customer who chooses to pay by credit card.

This works, but it is regulated. Rules vary by state and card network, you can never surcharge debit or prepaid cards, and you must register with the networks before you begin. So treat it as a compliance project rather than a pricing change. Surcharging in Dynamics 365 covers what compliant implementation requires.

Where surcharging does not fit your market or brand, the first four levers still apply.

Which lever to pull first

The right order depends on your business.

High-value B2B invoicing? Start with enhanced data and ACH. Together they usually deliver the largest reduction, and neither changes the customer experience.

High-volume, low-ticket retail? Focus on processor choice and routing, because small per-transaction differences compound quickly at volume.

International sales? Regional routing first. Better approval rates recover more revenue than fee reductions typically save.

Thin margins and a market where it is accepted? Evaluate surcharging, with proper compliance support.

Why the architecture decides what is possible

Notice that four of the five levers require something a single-acquirer connector cannot provide: processor choice, method breadth, routing, and portable tokens.

That is the practical case for a payment connector. SensePass links Business Central, Finance & Operations and Commerce to 50+ processors and 112 payment methods through one integration. Consequently cost reduction becomes an ongoing capability rather than a renegotiation you run every three years.

Frequently asked questions

What is the fastest way to reduce payment processing costs? Measure your effective rate first, then target the largest component. For B2B merchants, enhanced data and ACH usually deliver the quickest measurable saving.

Is negotiating a better rate worth doing? Yes, but it addresses only the processor markup. Interchange and network assessments are set by the networks, so no negotiation touches them.

How much can ACH save compared with cards? It depends on ticket size. Because ACH is typically flat-fee and cards are percentage-based, the saving grows with invoice value and is largest on high-value B2B payments.

What is enhanced Level 3 data? It is line-item detail passed with commercial card transactions to qualify for lower interchange. Visa requires Level 3 under its Commercial Enhanced Data Program, while Mastercard still uses Level 2 and Level 3.

Is surcharging allowed everywhere? No. Rules vary by state and card network, and debit and prepaid cards can never be surcharged. Treat it as a compliance exercise.

Does a cheaper processor always cost less? No. A lower rate with weaker approval rates can cost more overall, so compare both on real traffic.

Turn cost reduction into a capability

A renegotiation saves money once. An architecture that lets you change processors, steer methods and route transactions saves money continuously.

Request a demo, or start with the Dynamics 365 payments overview.