Mobile payments company LevelUp has announced plans to drop its interchange fee.

The company said Thursday that businesses that accept LevelUp as a form of payment will not be charged a payment processing fee. Instead, LevelUp said in a press release that it "will only make money by providing value beyond the transaction."

Through LevelUp, companies can create incentives and loyalty campaigns to bring in new customers and generate repeat business. LevelUp then promotes these campaigns and the incentives that customers can unlock as they shop.

Instead of charging an interchange fee, LevelUp will make 35 cents for every dollar of credit redeemed through the campaign.

LevelUp is a part of SCVNGR, which is backed by Google Ventures, Balderton Capital, Continental Advisors, Highland Capital and Transmedia Capital. More than 3,000 brick-and-mortar businesses currently use LevelUp.