In April 2025, Visa launched its Commercial Enhanced Data Program (CEDP) in the U.S., marking the most significant change to commercial card interchange in years. CEDP aims to ensure accurate, validated transaction data so issuers can deliver better insights and improved reconciliation.
CEDP replaces existing Small Business and Commercial Level 2, Level 3, and Large Ticket Programs. Under CEDP, new “Product 3” categories offer reduced interchange rates as an incentive for providing high-quality transaction data.
Visa now categorizes merchants into two groups based on data quality:
- Verified Merchants: Consistently meet Visa’s strict CEDP standards and receive interchange incentives at settlement, similar to current Level 2/Level 3 procedures.
- Unverified Merchants: Submit data that does not meet standards and receive non-CEDP rates at settlement. If transactions pass subsequent Data Quality validation, acquirers receive a post-settlement adjustment to preferred CEDP rates.
A novel aspect of CEDP is the introduction of a 0.05% “CEDP Participation Fee” for every participating transaction.
This new program represents a clear shift away from the traditional enhanced data framework, which operated on an honor system. Historically, merchants who populated Level 2 and Level 3 fields automatically received lower interchange rates. This approach led to widespread practice of inserting default or dummy data, often leading to misleading information that undercut the value of remittance data.
CEDP tightens the reins. With no mid-level qualification and new data validation mechanisms, merchants have a clear choice: commit to sending accurate data or settle for standard rates. The participation fee and delayed rebates introduce strategic complexity. Merchants essentially need to pay-to-play for potential benefits. Delayed adjustments mean merchants and acquirers may experience operational challenges in interchange management.
This new program changes the playing field for B2B merchants and solutions providers. Acquirers, ISVs, and merchants alike need to rethink their approach to data quality and submission. Competitors like Mastercard are undoubtedly monitoring this launch closely.
Here’s what to expect as CEDP rolls out:
April 2025:
- Initial CEDP launch; V.I.P. (authorization) and Base II (settlement) systems updated
- CEDP flag required for Level 3 and Large Ticket transactions
- 5BPS Participation Fee applies to all flagged transactions
October 2025:
- New Business Product 3 interchange categories introduced
- Rate changes for Commercial Product 3 take effect
- Issuers align systems with new interchange adjustment mechanisms
- Transaction Code (TC-20) reporting, used to provide detailed transaction-level reporting, will begin based on data adjudication results
April 2026:
- Level 2 programs for Small Business and Commercial Credit retired
- Fleet Level 2 Fuel-Only and Government Large Ticket transactions remain on existing rates
Considerations for navigating CEDP:
- System Readiness – Ensure front-end systems can handle “verified” and “unverified” flags – these directly impact interchange outcomes.
- Partner Coordination – Engage gateways, middleware providers, and ISVs early to confirm their support and readiness for new requirements.
- Data Quality Monitoring – Develop internal monitoring programs to flag merchants submitting non-compliant or incomplete data, reducing the risk of costly reclassifications.
- Credit and Clawback Processes – Prepare operational teams to manage interchange adjustments and reclassifications.
- Client-Facing Team Training – Provide clear training and documentation on verification criteria, Product 3 qualification rules, potential impacts on residuals and pricing, and effective merchant messaging.
TSG Can Help
Need help navigating the changes? Contact us to discuss strategic opportunities.
Correction (June 2025): A previous version of this article stated that the 0.05% CEDP Participation Fee would be charged for every flagged transaction regardless of eventual qualification. This interpretation was incorrect. The Participation Fee will only be charged for flagged transactions that meet the CEDP Enhanced Data Specifications (i.e., qualifies at Product 3).