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1. How will your virtual terminal help my business manage credit card processing fees?
2. How long is transaction data stored for?
3. Can I perform a zero dollar authorization to see if card is good and then bill my client later?
4. If I want to also accept payments with a card reader, including on a cell phone, will I get retail interchange rates?
5. What happens if a card on file is expiring?
6. Do you accept credit and debit cards and checks?
7. If I change vendors, can I extract stored payment data?
8. Can I block prepaid debit cards?
9. Can I store both credit/debit and check data, for variable amount recurring billing?
10. How will you protect my company from internal fraud?

Our own answers using the CenPOS Virtual Terminal:

1. CenPOS helps your business manage credit card processing fees with proprietary patent pending least cost routing and interchange optimization technology. The CenPOS VT isn’t just a web page with fields to fill in. It’s the hub for all payment entry points whether mobile, retail, ecommerce, or web. It’s an intelligent switch that makes decisions on the fly for you, removing people, software, and hardware limitations and errors from affecting your payment processing costs. Other virtual terminals have fixed fields to fill in. CenPOS data fields appear and disappear based on many factors, including how the payment information is being received, and  fraud control settings you manage.
2. All data is store for 7 years.
3. Yes, CenPOS supports zero dollar authorization; check with your processor to make sure they support it.
4. Yes, CenPOS proprietary switching technology automatically presents the correct data required to qualify for the best card not present or retail interchange rates. Additionally, this switching mitigates dispute risk by collecting and storing signatures, if required. If you offer pin debit, CenPOS will automatically prompt the consumer for their pin number, converting 76% vs national average under 25% in 2010. ALERT: if your business is mostly card not present, and you add a phone with credit card reader, for most virtual terminal solutions, you’ll have the signature as a benefit for sale, but unless you get a separate retail merchant account, you’ll still pay MOTO rates (card not present), which can cost 1% more.
5. CenPOS will automatically notify customers with an email address on file beginning 60 days prior to expiration. Merchants can also see a list of expirations, dynamically sort/search them, and even export them if desired.
6. Yes, CenPOS supports almost any payment method. CenPOS is future proof and will support all new payment types. Updates are virtually every month with no disruption to merchants or added costs.
7. No, you cannot extract stored payment card information. CenPOS is a PCI Compliant solution that uses both encryption and tokenization for maximum protection. If you can extract it, can the data really be that safe?
8. Yes. Membership, installment, and recurring billing merchants usually need this feature.
9. Yes. You can even print out a form with the merchant token ID and the last 4 digits that the customer can sign- replaces faxed forms with exposed card data.
10. There are numerous ways CenPOS protects merchants from internal fraud, a rising crime problem that often goes unnoticed for years, especially when a trusted, high-level employee is involved. In addition to micromanaging user permissions, and what types of transactions are even allowed, merchants can create real-time automated alerts. Additionally, the report writer provides endless opportunities for multiple executive staff member notifications of any payment aspectyou wish to track. For example, a daily email with all refunds, with credits without offsetting debits, with daily sales, with all refunds over a certain dollar amount, or with all refunds by specific employee.  By controlling access permissions, and how data is delivered, you can eliminate number fudging by a crafty employee.

    

 

 

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.

 

 

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Ecommerce receipts must include the Authorization Code and Transaction Type,  Purchase or Credit to protect merchants from chargebacks as a result of customer disputes, per the 2011 chargeback management guidelines for Visa merchants.

When a merchant cannot produce a receipt per the guidelines, the consumer will normally automatically win any dispute*, resulting in a chargeback to the merchant. This presents significant risk to ecommerce store owners. 

 

Receipt requirements are different for card present, thus the requirement to state the URL where the transaction occured. If a merchant submits an ecommerce transaction on a merchant account without the ECI indicator (ie a retail or MOTO account) this is another way merchants can automatically lose disputes.

Search “ECI” in the PDF for related ecommerce items. Customers cannot reverse transactions, they can only dispute them and the bank can reverse pending investigation.

Because the auth code is dynamically generated, this is a function of the shopping cart application and gateway.

* Although the Visa document contains “guidelines” merchants affirm that in their experience, it’s hard to win any dispute that does not meet all guidelines.

What is the payment flow from beginning to end of an ecommerce transaction? This is the credit card processing payment flow for MOST but not all gateways.

1. If ecommerce, the customer places an order. The ecommerce solution defines what data will be passed to the gateway. It uses an API to pass specified data to the gateway.
2. The gateway receives the transaction information and securely passes it to the payment processor.  Each gateway defines what data it will pass to the processor and it may collect more information than it passes. Each processor defines what information it will accept from a gateway.  The API uses the approved data and data format. The gateway must be certified to connect to the processor via a rigorous approval process to ensure security. The gateway transaction file includes yes/no parameters that were predetermined at the account set up level. For example, the “zip code must match or decline the transaction”. The gateway may also kill the transaction before sending to the processor based on merchant risk parameters that were set up.
3. The processor submits to credit card interchange network.
4. The credit card interchange network routes the transaction to the customers credit card issuer.
5. The credit card issuer approves or declines.
6. The credit card interchange network relays the answer back to the processor.
7. The processor records the transaction details and deposits funds in your account per your merchant account terms. It relays the results to the gateway.
8. The gateway records the transaction results and passes it to the ecommerce solution, which then stores on the customer record.  Again, the ecommerce solution defines which data it will accept from the gateway.

At the very beginning I noted the above applies for most but not all gateways. The exception is if the gateway is also a switch. In that case, the switch can bypass steps and go straight to the credit card issuer. This is more rare and none of the most popular gateways can do this.

If you could negotiate your credit card processing fees to Zero, how much would you pay a month? Probably a bundle, because over 95% of your fees are non-negotiable. They’re set by the card associations and there’s nothing you can do about it. Right?

Wrong! There are rules within rules about how to qualify for each rate, creating 100’s of rates.  They are fluid and changing, yet merchants have dumb equipment that’s programmed one time to collect just enough information to process a transaction and, if they’re lucky, include basic fraud prevention and commercial card data collection prompts. It’s virtually impossible for a business to control credit card processing costs this way.

The solution is an Intelligent Transaction Engine, allowing each card type to be processed in the least costly manner. It automatically identifies credit vs. debit cards as well as different credit card types, i.e, personal vs commercial cards, and then sends the necessary data to qualify that transaction for the lowest cost possible. It eliminates costly human errors. Since other solutions cannot identify the card-issuing bank to determine what elements are needed to process efficiently, this is truly unique.

Unique benefits for moving and relocation industry:
* How often are your good faith estimates exactly the same as the final bill? When an authorization amount and capture amount are different, it automatically costs more. Our engine resolves this, saving you up to .7% in interchange fee downgrades.

* For commercial accounts, eliminate repetitive steps to charge the same account over and over again. Create billing contracts and enter card data one time only. Add multiple cards and multiple contracts. To charge enter a Token ID, amount, and an invoice number, and the receipt is automatically emailed to your client.

Will this hosted payment processing technology improve your EBITDA?
Does your business accept credit cards over the phone?
Do you get an initial authorization, and then charge later? Is the amount you charge different
than the initial auth?
Do you have accounts that you bill over and over again?
Do you have multiple business units?

If you answered yes or sometimes to any of these questions, the answer is YES. Nearly EVERY business just like yours who saw a demo, also implemented our platform.

3D Merchant Services Moving and Relocation brochure. PDF download 256kb.

Reduce the risk of accepting credit cards with these tips for summer resident camps. How many people who handle credit card processing really understand PCI Compliance? Below I list some do’s, dont’s and solutions that really work.

Best practices for payment PROCESSING TIPS FOR CAMP ORGANIZATIONS:

DEPOSITS: To accept reservation deposits, the merchant must clearly state the rules for refunds whether online or via mail in form. Does your system allow refunds to occur without a corresponding sale? Ask me about solutions that block this type of transaction and also control who can perform refunds. Do not refund a credit card if the original transaction was a check.

MAIL IN FORMS:

1. Do not ask customers to put their security code on the mail order form. It’s just too high of a risk. Remember, the 3-4 digit security codes (CVV, CID) never affects your credit card processing costs.
2. Create a form that enables you to shred the card data, yet still maintain the rest of the information you need, including signature.
3. If applicable, ask the customer for permission to allow you to rebill their credit card with whatever terms you want to create. A simple check box works great. Instead of storing card data, use Tokenization for recurring billing or rebilling.

PHONE ORDERS AND COLLECTIONS

It happens all the time. The date when final funds needs to be received has arrived.  Who calls who is irrelevant. If the customer wants to give you the information over the phone, how are you obtaining it? In most cases, the phone order taker simply writes it down on a piece of paper. The information is then used to process the payment later, whether after hanging up or by someone else in the office. How often is that card data then immediately put into a cross cut shredder to destroy it?

RECOMMENDATION: Have the phone operator enter the card data into a virtual terminal (VT).  The VT is a secure web page in which you enter transaction information. If that person is not authorized to run transactions, we have a solution that enables the operator to enter the card data and get an immediate authorization, and the proper personnel can process the transaction later. The receipt can be automatically emailed to the customer, or you can print and put in the mail.

ECOMMERCE: Don’t choose a payment processor just because they have a solution for your ecommerce needs. There are several excellent gateways to choose from for online payments, so the processor and gateway need not be the same and in my experience they almost always have higher costs. Even though I could offer a single solution myself, I never tie the two together. Keeping them separate gives you the most flexibility over time. I liken it to getting free equipment. There’s a catch and it’s usually not to your benefit.

COSTS:  Is your account set up the best way to qualify for the lowest rates for your type of organization? How do you know? In most cases you need a MOTO account, which stands for mail order, telephone order. Did you know it’s a violation to accept payments on your web site with a MOTO account? Merchants are required to have an ECOMMERCE designated account to accept payments online.

Payment processing is very complex and the nature of a business that gets the bulk of its payments in a short window only makes it harder for personnel to keep up with all the latest information.

Our team can help you with data security, compliance, cost control, and any other issues you face regarding payment collection, especially with temporary summer personnel.

Related articles:

Should you require CVV or AVS for phone orders?

2009 story on credit card processing for summer camps.

Want a FREE Camper Reservation Order Form makeover? Fax your existing form with FREE MAKEOVER on the cover sheet  to 954-942-9804 and I’ll mark it up with recommended changes to improve your PCI DSS Compliance at no cost! Include your merchant statement(s) along with total annual volume and I’ll send you a video report you can view at your leisure that clearly identifies areas for improvement including cost savings.

Cost reduction specialists choose 3D Merchant Services to partner with for credit card processing because we offer value added services just like they do.  Cost reduction specialists look for ways to reduce credit card processing costs and frequently are paid on a contingency basis. Merchants don’t switch processors just to save money though. They need a bigger reason than that.

Merchants hear from sales people every day “I can lower your costs.”  While some cost reductions are achieved with merchant discount changes, most long term savings are achieved through interchange management. There’s also improved efficiencies (save time) which can be huge. If the cost reduction specialist uses just the  ‘save money’ approach, they’ll lose more deals than ‘save money AND get more benefits’.

Our competitive advantage:

• PCI Compliance Certification Assistance.
• Fortune 100 Pricing Structure.
• Relationship Manager proactively helps you manage costs; regular account reviews.
• On demand access to transaction details and reports you really want.
• Tools and resources to prevent internal and external fraud.
• Hardware/software agnostic- compatible with most systems.

Our Top 5 vertical markets: ( not in order)

• Retail, especially durable goods, automotive, construction supplies and electronics.
• Non-profit
• Wholesale building supply; any Business to Business (B2B)
• Hotel and entertainment (golf, amusement)
• Ecommerce

Market niche comments:

• Card not present transactions have many potential cost and risk problems. We’re seeking B2B, insurance, medical billing and non-profits in particular.
• For retail stores processing more than $1 million per month, our CenPOS technology solution is frequently desirable and has benefits not available from other competitors.
• Our average merchant is processing a minimum of $1 million annually.

Service reliability- I hope that this is a non-issue in any organization. Downtime is non-existent in my experience.

Another worry for merchants is the process of changing.  We address this upfront with an implementation schedule. Both parties need to have all elements or questions answered completely before we start to ensure a smooth and flawless transition.

For the Cost Reduction Specialist to prove savings, and thus get paid, you’ll need reporting that shows not only costs, but the full detail of all costs. Merchant reports show full details so that you can discern non-negotiable cost increases (such as an interchange rate increase) that are out of anyone’s control.

Our services are not limited to just credit card processing. We offer services for all aspects of payment processing, including checks, loyalty cards and more.

We conduct account reviews, training, and other conference calls using Webex, a web based meeting program that allows us to exchange voice, data, pictures and video in real time with customers, and you, regardless of location.

Merchant services for political campaigns tend to cost more than for retail merchants. Why? The main reasons are their lack of knowledge about the subject and then all the other reasons. Other reasons include how payment is collected, the types of cards presented, and the credit card processing price plans they are on. Below I’ll address each issue in brief.

First their lack of knowledge makes it easier for other companies to charge them more money. Think used car salesmen 25 years ago. Small campaign races will generally pay more than big races because there is little to process. This is simply an ROI issue just like with small businesses. But what about the bigger campaigns?

How do politicians collect money for campaign contributions? The most popular are checks in the mail, donor cards collected at speaking events (check or credit card which is key entered later), and online donations. The donor card exposes the politician to substantial risk. Where are the cards stored while traveling from one event to the next? Who opens the mail? Who keypunches the data? What kind of training have they had in protecting card data? Do you perform background checks on volunteers who see donor cards?

• Reduce risk by keypunching data into a virtual terminal on site.
• Reduce risk and cost by attaching a card reader to a computer. You’ll save about 0.5% by swiping vs key entering.
• Always securely shred card data upon completion of transaction. With a well-developed donor form, you can detach or cut off the credit card data while still keeping critical information on the form such as payment amount. Record the authorization number and date processed on the form for your records.

Costs are affected by the type of card presented for payment. You can’t control this. But you also need to know the merchant services game because this is a big gotcha. In my experience, the card type can relate to the type of race; the bigger dollar donors use rewards or corporate cards. Campaigns targeting smaller donations attract a high amount of debit cards, up to 50%. Here’s the big catch on merchant agreements- QUALIFIED RATE. Chances are 80% of cards presented will never hit the qualified rate. So what’s your non-qualified rate? What’s your best rate for corporate cards for a MOTO merchant account? (Interchange is 2.2% plus $.10 per transaction. )

Common Visa interchange rates for reference: RETAIL= swiped card. MOTO = mail order or phone order. Ecommerce rates are the same, but account set up and rules are different. Below is a very small list of the 500 or so possible rates. We see every day on merchant accounts.

• debit/check card, swipe .95% plus $.20 per transaction
• debit/check card, MOTO 1.53% plus $.10 per transaction
• credit card, swipe 1.79% plus $.10 per transaction
• rewards card, MOTO 1.95% plus $.10 per transaction
• Commercial card MOTO 2.2% plus $.10 per transaction
  Downgrade costs can be nearly 1%, and remember, these are interchange costs. Your fees will be higher.

Credit card processing price plans vary widely for this industry, but in general, are much higher than others. That’s not because the raw costs are higher, its because the payment processors take bigger profits. Remember what I said about the used car salesman. Credit card processing is not the core skill of the average politician and it may not be for the finance manager either. One of the most valuable assets of a politician is their time. Therefore they tend to copy what others in their party are doing, or simply look for the easiest solution that solves many of their time issues.

Ecommerce solutions for politicians are plentiful as they are for non-profits. I have no problem with payment processing costs being higher than average if you get a robust software package at no cost. Companies have to recoup their investment somewhere. But what if you pay for the software and the payment processing?

Let’s look a little deeper into an example such as Click & Pledge. It has lots of cool features to manage donors and build an online community. They also have an integrated payment processing solution option. I had to read several sections a few times, and based on what I read,  I’m still not sure. Can you use their other features but not the payment processing/ They have API section which looks like a yes, but the non-existent comments in the forum make me wonder.

Their rates are among the highest I’ve seen at 4.5% and $.35 per transaction. But wait- that’s not for all cards. “Visa & MasterCard may add additional fees for affinity and cards which earn points. These cards are referred to as non-qualified cards and typically have 1% surcharge associated with them. The fees are not being charged by Click & Pledge and we have no control over which cards will be charged as a non-qualified card.”  So merchants can expect to pay up to 5.5%. Basically they’ve locked in at least 2% profit (also known as 200 basis points) by my estimation, and that’s very high in todays marketplace.

Two percent is about double the norm for a small business from what I’ve seen, although that market is not my specialty. Maybe solutions like this are still a good fit for your campaign. But before  you buy, ask if you’re allowed to use your own merchant account. In most cases you’ll do better far on price and there are other benefits as well. For example, if I were managing your account, I’d make sure you had the right type of merchant accounts for different situations to meet Visa and MasterCard regulations. You’ll get advice and handouts for volunteers on proper data security. We can assist with your check processing, including remote deposit capture. We can assist with payment type and provide risk management advice to help protect you against embarassing data security breaches.

Keep more money from your online donations. Get a merchant account separate from your software or web host.