If one thing is certain, it’s the uncertainty of what the mobile payment space will look like five years from today. Professional sports organizations seeking new payment technology, while improving PCI Compliance (Payment Card Industry Data Security Standards), need to consider whether the company they partner with will still be around in the future.

I recall back in the mid-90′s, working as a trailblazer bringing professional sports and related parties onto the internet. So many companies came and went. Yahoo, DoubleClick and Real are still in business. About a thousand other hot companies have long since disappeared.  Similarly the entire payment industry is going through a transformation, with hundreds of companies vying for a position in mobile payments or some other slice of the payment pie. Even big Google Wallet couldn’t generate a dominant marketshare. It’s a safe bet that 90% of them will fail, and some of them already have.

A little history might help breen caution. For over a decade, ISO’s, or Independent Service Organizations, grew dramatically. Instead of obtaining a merchant account from one of a few options via the big banks, businesses could buy the same product, or nearly the same product,  from an ISO, but often with lower mark-ups over interchange fees. As the economy grew in the last decade, a large number of companies borrowed against their residual earnings. When the economy tanked, businesses went under, and many businesses were over leveraged. There is a contraction underway in the ISO industry. The mobile payments space doesn’t typically have the revenue stream, and instead often relies on angel investing. A contraction will come for them as well.

What does an ideal mobile payment solution look like? The equipment makers and others pounded the drums for NFC, but to date, it’s made little movement. Ideally, both the consumer and merchante will benefit from any new payment solution. It needs to create efficiencies, and improve security.

CenPOS is a fast growing payment technology network that streamlines the payment experience for merchants and consumers alike. It has several advantages over other solutions:

1. CenPOS is non-disruptive to operations. It routes transactions to existing financial partners, including credit card and check processors.
2. CenPOS supports multiple channels. Kiosk, mobile, retail POS, ecommerce and more.
3. CenPOS reduces PCI burden.
4. CenPOS is scalable and flexible.
5. Integration options vary widely by need.
6. CenPOS started years ago as a company to create efficiencies for consumers and merchants. The others are playing catch up.

When all the facts are considered, CenPOS is the most robust solution on the market today, and with continual innovation, markets will drive future enhancements.

About CenPOS: CenPOS is an innovative payment processing network that streamlines the payment experience for both merchants and customers. It’s multi-channel support and SaaS model, has catapulted a shift in payment technology adoption in a variety of industries. CenPOS is fast, easy to use, and requires no capital investment to implement. For CenPOS sales call Christine at 954-942-0483 or click here for more information.

Law firms and other professional services businesses often have tax exempt sales. Regarding credit card processing interchange rates, if Visa Level II is only applicable on transactions with sales tax,  does this mean Comm Card Elec transactions that are at 2.95% cannot qualify for Level II and lower rate?

Not exactly. Merchants, including law firms, can qualify for lower rates than 2.95% for corporate cards.  The merchant must have a qualified business code (MCC) as submitted on their merchant application. The transaction must also be supplied with the correct data to qualify the transaction, which may vary depending on different factors.

Below is related information from Visa. Visa does not publish the ‘qualification criteria’ for different rate types, leaving it up to merchants to figure it out, or to rely upon their credit card processing vendor to help them.

Visa International Operating Regulations April 2012:

Commercial Card – Non-Travel Service, Level II Interchange Reimbursement Fee – U.S. Region In the U.S. Region, the Commercial Level II (non-Travel Service Category) Interchange Reimbursement Fee is available for taxable Commercial Visa Product Transactions that are CPS-qualified and meet certain additional data requirements as specified in the U.S. Interchange Reimbursement Fee Rate Qualification Guide. Tax-exempt Commercial Visa Product Transactions and Commercial Visa Product Transactions using the CPS/Account Funding program are not eligible for the Commercial Level II (non-Travel Service Category) Interchange Reimbursement Fee.

Commercial Card Business-to-Business (B2B) Interchange Reimbursement Fee – U.S. Region
In the U.S. Region, Commercial Visa Product Transactions that do not meet the Level II Enhanced Data requirement will qualify for the Commercial Business-to-Business Interchange Reimbursement Fee. To qualify for this program, the Transaction must be CPS-qualified as specified in the U.S. Interchange Reimbursement Fee Rate Qualification Guide and be completed at a Merchant properly assigned a business-to-business Merchant Category Code as specified in the Visa Merchant Data Standards Manual.

EDITORS NOTE: Looking at the Visa chart above, can you tell which rates are ‘qualified’ or ‘non-qualified’? No. And that’s the difficulty merchants, CFO’s,CPA’s and controllers face every day. The qualified rate rules are also different for MasterCard corporate cards which will be addressed in a later article.

CenPOS is a universal payment processing platform that provides efficiencies for merchants and their customers, reduces PCI DSS compliance burden, and many other benefits, including,  CenPOS is an intelligent payment processing platform that replaces inefficient and outdated solutions. A key differentiator is the proprietary way CenPOS helps merchants qualify transactions automatically. Unlike other solutions, it doesn’t rely on employees to do the right thing at the time of transaction.

WHERE TO BUY

CenPOS is sold through direct agents and resellers. There is also a referral program. Click here to become a CenPOS agent, reseller, or referral partner.  Click here to become a customer or call the hotline at the top of this web page.

MasterCard updated their merchant interchange rates and fees portion of their web site. It’s a useful for all merchants. The missing link to all this data however  is a clear identification of which transactions are qualified and which ones are not.  For example, if a merchant is on Interchange plus pricing, it lists all the interchange rates the merchant paid. But it doesn’t indicate which ones are qualified and which ones downgraded to a higher rate. Some processors provide this information, with a section call ‘non-qualified’ transactions, however, the software frequently shows transactions as non-qualified that truly are the best qualified rate that a merchant can receive.

As a merchant I would want to know which rates are the best possible for a given card type at a glance. Why should a merchant have to hunt through hundreds of pages to figure it out? Interchange is not getting less complicated. Our team offers merchants an automated solution to qualify transactions for the best interchanges rates. Contact us for details.

3D Merchant maintains a list and links of all official interchange rates here.

Accept payments via mobile, internet, and at fundraising events all with a single gateway solution that provides optimum security and cost containment. Fundraising solutions for any candidate must include a variety of payment methods, cost controls, reporting tools, and be simple to implement. This article explores how our solution achieves this.

Just like a business, accepting funds via credit card can be expensive when running for Congress, Senate, President or other offices. However, thanks to debit legislation under the Durbin Amendment that went into effect October 2011,  it’s not nearly as much as it used to be. With a wholesale cost of .05% and $.21 per transaction for non-exempt debit cards, the overall cost of credit card processing has been greatly reduced. With a wholesale merchant account, you’ll pay interchange fees at all levels plus a small merchant discount.

Understanding merchant accounts.

1. You can apply for an ecommerce merchant account, MOTO (mail order/phone order), or Retail (card present /swipe). It’s against card association rules to process ecommerce transactions on a MOTO or Retail merchant account. But if you have an ecommerce merchant account, you’ll pay higher card not present rates on swiped transactions. The solution? Our CenPOS gateway  automatically identifies the transaction method and sends the appropriate data so that the transaction will qualify for retail. The CenPOS patent pending switching technology is not available from other vendors and saves big money. For example, save .3% on Visa Rewards cards- the difference between retail and card not present.
2.  Fees are made up of fixed non-negotiable interchange fees, network fees, card association fees, fees that vary by vendor (some hard costs vendors incur may vary), and negotiable merchant discount fees. Altogether when you divide your total fees by the net transactions we call this your effective rate. With a wholesale merchant account, an estimated effective rate for political fundraising campaigns is 2.2%, or 3.5% for very small campaigns. If you’re not paying any where near that, contact us for alternatives.
3. Different payment acceptance points can result in disparate reporting, which is never a problem until you’re trying to research something and then it becomes a nightmare.
4. A gateway is required to accept payments online. You need both a merchant account and a gateway. CenPOS is a universal gateway, compatible with all major processors.

Campaign Fundraising Concerns and how we solve them with the CenPOS gateway:

• Need to accept payments via many methods:  At the core of CenPOS is a Virtual Terminal for card swipe, online payments, mobile payments and any other method. CenPOS automatically switches payment routing for least cost.
• Need to accept multiple payment types: Check and credit/debit cards are currently accepted, and more options will be available in 2012.
• Large volunteer base may assist in payment collection. This creates potential liability for data security, but also a need for simple solution. Have you ever handed out donation cards at a fundraising event that requests credit card information to be written down? Identity theft is a major threat. Instead, use smart phones with the free CenPOS app and get cards swiped at the table or door, or add a card reader to any laptop. Micro manage user permissions and shut them down on demand. CenPOS prompts both the user and the donor for the appropriate actions. “Dummy proof” your payment collection to reduce costs and improve record keeping.
• Donor Management: An API (application interface) is available to exchange data with your donor management software. CenPOS supports recurring billing and can send the appropriate secure token to your software as well. CenPOS stores 7 years of data storage vs the typical 18 months of merchant services providers and gateways.
• Finance scrutiny and Fraud protection: CenPOS mitigates risk of fraudulent cards and also offers advanced protection to block certain payment types including anonymous and foreign issued cards. You’re in control of how tight you want to control donations.

If you use Costco’s credit card processing partner, Elavon, which acquired Nova in 2009, or another processor, then your price plan likely includes prices tiers such as qualified,  mid qualified, and non-qualified. This is where merchants have a difficult time comparing processor quotes and get upset when the bills come in.

We reported the latest 2011 rates in the Costco program with Elavon earlier this year. They offer a low Visa/MasterCard qualified rate. It’s an attention getter, no doubt. Here are some 2010 statistics about cards being used by consumers:

• Visa’s overall volume is 60% check cards, MasterCard 35% check cards.
• Only 10% of all card volume is traditional cards- no business or rewards.

Here are the Costco member Elavon published 2011 rates  again:

Visa/MasterCard Qualified (Traditional Credit & Signature Debit) 1.48% plus $0.20 (reduced)
Visa/MasterCard Qualified Rewards 2.20% plus $0.20 (increased)
Visa/MasterCard Partially Qualified 2.96% plus $0.33
Commercial Non-Qualified 2.96% plus $0.33
MasterCard Non-Qualified 3.80% plus $0.33

As previously reported in April 2010 Costco, Elavon, Nova and merchant rates, I’m still neutral for accounts processing under $100,000 annually. Qualified means retail card swiped in the above numbers. Why neutral? As I’ve said before, if you process $5000 or $10000, there’s not much difference in suppliers if you saved even .5% in fees.

At $20,000/mth, the difference in what you’re really paying- remember most cards are rewards related-on the Elavon plan vs a plan we can put you on can start making a difference.

3D Merchant Services specializes in mid-size businesses. As part of our  giving back to Help American Businesses Prosper program, we’re now accepting up to four small businesses per month into our partner portfolio. After all, we were a small business at one time too. Businesses will receive preferred partner credit card processing terms and education to make their businesses secure while controlling costs.

No, all our processors charge a fee for statements which cannot be waived even if you select electronic statement delivery instead of having them mailed to you. I have two thoughts about this. First, we have to pass through fees and it’s a hard cost that is never waived for us. Second, there is an expense associated with printers, printer maintenance, ink & paper, stuffing envelopes, postage etc. There are also expenses with having an IT team that develops and maintains secure systems for making electronic delivery available. So in both cases, there is a cost to providing an essential service- the timely delivery of your merchant statements.

What if someone else doesn’t charge a statement fee? Can you match that? No. Again, all the processors we work with have a statement fee that can never be waived.

With ever tighter margins in credit card processing, it’s critical to charge for actual costs and work more closely with customers on managing variable costs.

Video message about the high cost of rewards cards also includes information about three tiered pricing and interchange rates. A partial merchant statement is shown to demonstrate what the best rates and price plans look like on a merchant statement.

What 3 things do you need to know to compare credit card processing rates?

1. What is the quoted rate?
2. What are the criteria to qualify for that rate?
3. What is your cost if you do not qualify for the quoted rate?

The same questions put in merchant account lingo?
1. What is the qualified rate?
2. What are the criteria to qualify for the qualified rate?
3. What is your cost if you do not the criteria for qualified rates?

Notice these questions don’t even ask what is the monthly minimum or what is the statement fee. If your business is doing any volume, these are just not a factor. Most businesses that do their research online will only find the quoted rate. There may be some fine print about rates, but in many cases, the information is missing. What’s almost always missing are the non-qualified rates. So you sign up online with a preliminary application, then afterwards they send you an email saying you have been approved and now they need more information. The full details must be disclosed at this point, but most businesses don’t understand or don’t want to spend any more time looking for another deal because they already spent all their time finding that one!

Always request via the contact form or email the full contract details.