Tech Mahindra and Mastercard Push B2B Virtual Cards: Supplier Playbook

The Tech Mahindra and Mastercard B2B payments deal will send suppliers more virtual cards. Here's how to accept them without giving up margin.

Adrian ReyesSenior Payments & Fintech Editor

October 27, 2026 · 8 min read

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Photo: Pixabay

On this page 7 sections

What the Tech Mahindra and Mastercard B2B Payments Deal Covers
Why Big Buyers Are Moving Supplier Payments to Virtual Cards
What Accepting Virtual Card Payments Really Costs a Supplier
Level 3 Data and Interchange Savings Under Visa's New Program
Surcharging and Card Acceptance Policies for B2B Invoices
Matching ERP Virtual Card Payments to Open Invoices
Supplier Action Checklist Before Buyers Switch Payment Methods

Key takeaways

Nuvei reports that Visa's Level 2 program ended on April 18, 2026. Visa now gives lower commercial rates only to "verified" merchants who send Level 3 (Product 3) data.
Better data lowers your interchange only if your pricing passes interchange through to you (interchange-plus). On flat-rate or tiered pricing, sending perfect data may save you nothing.
Single-use virtual cards are often issued for the exact invoice amount. If you surcharge, put it on the invoice before the buyer issues the card.
In our illustrative $12,000 invoice, a verified Visa Business Tier 1 sale cost $216.10 in interchange plus the CEDP fee. The same sale without enhanced data cost $318.10.

Tech Mahindra and Mastercard announced on Oct. 26, 2026, that they will build Mastercard's virtual card and embedded payment tools directly into the ERP and procurement software large companies use to pay their suppliers. For suppliers, the Tech Mahindra and Mastercard B2B payments partnership points to one practical change: more invoices paid by virtual card instead of check or ACH, keyed in at commercial card rates. You can take that volume without giving away your margin. To do that, your processing setup has to send the right transaction data, your pricing has to pass the savings through to you, and your card policy needs to be settled before the first card number lands in your inbox.

What the Tech Mahindra and Mastercard B2B Payments Deal Covers

The announcement was made from Pune, India. According to coverage of it, Mastercard's virtual card and embedded payment capabilities will be integrated with major ERPs and with procure-to-pay and source-to-pay platforms, and Tech Mahindra will handle the integration and transformation work. In practice, a purchase approved inside a buyer's procurement system can be paid with a virtual card or another Mastercard payment method from the same screen, without a trip to a separate bank portal.

The companies say the integration will rely on APIs, payment automation, real-time reconciliation, fraud management and tighter payment controls. Their stated goals are better working capital, stronger spending controls, faster payment and reconciliation, and simpler supplier onboarding, all without replacing the buyer's existing systems. Roshan Shetty, Tech Mahindra's BFSI and public sector head for the Americas, described the aim as "bringing payments directly into the flow of procurement and finance." The release also mentions agentic AI workflows.

The coverage we reviewed does not include named enterprise clients, specific ERP products, a launch timeline, pricing or terms for suppliers. Treat anything beyond the points above as unconfirmed.

Why Big Buyers Are Moving Supplier Payments to Virtual Cards

A virtual card is a card number, usually issued for a single payment or a single supplier. It comes with limits on the amount and the date window, and sometimes on the type of merchant. The buyer's accounts payable team sends the number to the supplier by email, portal or remittance file, and the supplier runs it like any other card.

The buyer gets three things out of that. The card bill comes due after the supplier has been paid, which stretches the buyer's cash. Each payment is tied to an approved purchase, so spending controls are built in. And commercial card programs commonly share revenue with the corporate cardholder based on spend. The supplier, meanwhile, pays the acceptance cost.

Embedding matters because it turns card payment into a default option inside AP software instead of a side project. "Simplify supplier onboarding" is one of the partnership's stated goals, so expect enrollment requests from buyers whose systems adopt it. Before you answer one, know what card acceptance costs compared with the ACH or check you get today. Our comparison of ACH vs. credit card payments for costs, speed and risk lays out that trade-off.

What Accepting Virtual Card Payments Really Costs a Supplier

Your cost on any card sale has three layers. Interchange is set by the network and paid to the card issuer. Network fees go to Visa or Mastercard. The processor's markup is the only part your provider controls.

Virtual cards are commercial cards, and commercial cards generally carry higher interchange than consumer cards. Virtual cards are also always card-not-present. There's no physical card to tap, so you enter the number in a virtual terminal for keyed B2B payments or a gateway. Card-not-present sales cost more than in-person sales because they carry more fraud risk, as we explain in why keyed transactions cost more and trigger reviews.

Ticket size also matters. B2B invoices are often far larger than a typical retail sale. For example, an illustrative $40,000 keyed charge on an account whose usual ticket is $3,000 can set off a risk review or hit a monthly volume cap. If a large customer is about to switch to card, ask your processor to review your limits first. Our guide to raising your merchant account processing limit covers what underwriters want to see.

Misunderstood point: The interchange savings in the next section only reach you if your pricing passes interchange through to you, as interchange-plus pricing does. On flat-rate or tiered pricing, you can send perfect data and still pay the same rate. That comes from your processor's pricing, not from a network rule.

Level 3 Data and Interchange Savings Under Visa's New Program

Level 2 data adds fields such as sales tax and a customer code or purchase order number. Level 3 adds invoice-style line items: product codes, descriptions, quantities and unit prices. The networks give lower commercial interchange to transactions that carry this detail.

Visa changed its rules in 2025, and a lot of older advice hasn't caught up. Visa launched its Commercial Enhanced Data Program (CEDP) in April 2025. It also began charging a 0.05% participation fee on commercial transactions that include Level 2 or Level 3 data. According to the Merchant Advisory Group, Visa started using machine learning on Oct. 17, 2025, to rate each merchant's data quality and label it verified or not verified.

Verified merchants qualify for what Visa now calls Product 3 rates (the old Level 3 discount). Gateway provider NMI reports that CEDP replaces Visa's Level 2, Level 3 and non-GSA Large Ticket interchange programs. Nuvei reports that the Level 2 program fully ended on April 18, 2026. If your gateway still sends only tax and a PO number, don't assume Visa is giving you a discount for it.

Nuvei published this comparison of Visa business card rates effective Oct. 17, 2025:

Visa Card Tier	Verified (Product 3)	Not Verified
Business Tier 1	1.75% + $0.10	2.65% + $0.10
Business Tier 2	1.90% + $0.10	2.80% + $0.10
Business Tier 3	1.95% + $0.10	2.85% + $0.10
Business Tier 4	2.05% + $0.10	2.95% + $0.10

NMI reported more changes in January 2026, including higher Product 3 rates for small business cards. Check Visa's current interchange table with your processor before you budget. Small details also decide whether you qualify. Versapay notes that tax-exempt sales have to be marked exempt explicitly; a tax amount of zero isn't enough.

Here's an illustrative example. Assume a $12,000 invoice paid with a Visa Business Tier 1 card, interchange-plus pricing and the October 2025 rates above. Processor markup and other network fees are left out because they're the same either way.

Not verified, no enhanced data: 2.65% of $12,000 plus $0.10 is $318.10.
Verified with Product 3 data: 1.75% of $12,000 plus $0.10 is $210.10. Add the 0.05% participation fee of $6.00 and the total is $216.10.

That's $102 saved on one invoice. Under the same assumptions, a supplier running ten invoices like it each month would keep about $1,020 a month, or about $12,240 a year.

One caveat applies to this partnership in particular. Its virtual cards are Mastercard cards, and Visa's CEDP doesn't cover them. Mastercard sets its own commercial interchange schedule and its own enhanced-data requirements. Ask your processor to show which Mastercard commercial categories your transactions qualify for today. For field-by-field setup, see Level 2 and Level 3 processing for B2B cards.

Surcharging and Card Acceptance Policies for B2B Invoices

A supplier has four ways to handle virtual card fees:

Absorb them.
Build them into your prices.
Add a surcharge where it's permitted.
Decline to enroll in a particular buyer's card program and keep that account on ACH.

Enrolling in a buyer's program is a business decision you can negotiate. Some suppliers accept the card in exchange for faster payment than the net 30 terms they'd otherwise wait out.

Surcharging falls under two sets of rules. Visa and Mastercard set caps and disclosure and notice requirements, and they limit which cards you can surcharge. Some states add their own restrictions. Our breakdown of Visa and Mastercard surcharge rules and our guide to passing card fees to customers on B2B invoices walk through the current requirements. This is general information, so confirm your setup with your processor and a qualified attorney.

Virtual cards add a practical problem. A single-use card is often issued for the exact invoice amount, so charging the invoice plus a surcharge can be declined. The buyer's enrollment agreement may also cover surcharges. Read it before you sign. If you do surcharge, show it on the invoice before the card is issued so the buyer's AP team can approve the right total. A provider that runs a compliant surcharging program can handle the disclosure and the math at the gateway.

Matching ERP Virtual Card Payments to Open Invoices

The buyer gets real-time reconciliation inside its ERP. You don't, unless you set it up. Virtual card payments tend to arrive as an email with a card number and a remittance note. The money then lands in your bank as a batch deposit that doesn't line up with any one invoice.

A few habits fix most of that:

Run one transaction per invoice, even when a remittance email covers several.
Enter your invoice number in the gateway's invoice or PO field. That field feeds your enhanced data as well as your records.
Process cards the day they arrive. Virtual cards are only valid for a set period, and an expired number means chasing AP for a new one.
Ask whether your processor can deposit gross amounts and take fees out monthly, so each deposit matches invoice totals.
Sync your gateway to your books. A QuickBooks payment integration can post card payments against open invoices instead of leaving them for manual entry.

Keep the remittance email, the PO and proof of delivery with each payment. If a buyer disputes a charge later, that file is your evidence in chargeback representment.

Supplier Action Checklist Before Buyers Switch Payment Methods

Do these before the enrollment emails arrive:

Pull your last three statements. Find your commercial card volume and the interchange categories it qualified for.
Confirm your pricing model. If it isn't interchange-plus, ask what you'd pay on it.
Ask your processor whether your payment gateway sends Level 3 line items in the format Visa's CEDP requires, and what your verification status is.
Request a limit review if any customer could move large invoices to card.
Write a card acceptance policy: which accounts you'll enroll, whether you'll surcharge, and who in accounts receivable handles virtual card requests.
Prepare questions for buyers. Ask whether the card is single-use or multi-use, how numbers are delivered, what remittance detail comes with them, when payments go out and what their surcharge terms are.

Then run the worked example above on your ten largest customers, using your own rates. If the numbers look wrong, MannyPay can review a recent processing statement with you. Request a free quote and a specialist will respond within one business day. The open question to watch is which ERP and procurement platforms go live with the Mastercard integration first, because that tells you which of your buyers will ask next.

Sources

About the author

Adrian Reyes

Adrian Reyes is Senior Payments & Fintech Editor for Beyond the Swipe, covering credit card processing, merchant accounts, payment technology and processing fees.

This article is for general educational purposes and is not legal, tax or financial advice. Card network rules and state laws change; confirm current requirements for your business.