What’s Next for Mobile Credit Card Processing?

Everyone’s talking about mobile credit card processing.

Magazine editors, blogger and pundits are constantly forecasting the next development, the next startup to seize the industry, and how it will all affect merchant service providers. With so much buzz, it’s hard to keep up.

But the gist is that consumers are slowly adopting mobile payments, and that this rate should soon increase. A recent survey by MarketLive survey showed that during the 2012 holiday season, 16 percent of consumers planned to do all or most of their shopping on a tablet or smartphone. This was up from 3 percent in 2011.

Not Just One Option

When many merchant service providers think about mobile credit card processing and mobile payments, they think of Square. The company has been in the news a lot recently. They announced a partnership with Starbucks (Square will process all debit and credit card transactions for the company). They announced fixed merchant pricing. And they launched a television ad campaign.

Although Square is the big name in mobile processing right now, remember that there are many other options available. Your processor can offer you other solutions to compete with Square, including ePN Mobile, Magtek QwickPAY, VeriFone PAYware Mobile and TSYS Mobile Payment Acceptance.

The Jury is Out On...

Mobile Wallets. There’s a lot of buzz around them and many options have been launched, but consumers aren’t adopting them quickly. Furthermore, there aren’t many standards for mobile wallets, so some in the industry are questioning their security.

Near Field Communications (NFC). Near Field Communications is a type of technology that some in the industry have praised as the next big thing for mobile processing. But at a recent conference, many of the speakers were not as optimistic. NFC isn’t the only way data can be exchanged between mobile phones and POS systems. So the future of mobile payments doesn’t necessarily depend on it.

And the Future Holds...

Mobile credit card processing is in flux right. No one really knows the future. But you can count on one thing: the technology that becomes king will be the one consumers like best.

Most likely, it won’t be a simple option. It will probably include coupons and tie in to loyalty programs, offering extra value to the consumer instead of just being another way to pay.

What you think the future holds for mobile credit card processing? Which solution do you think will grow to dominate the industry? How will it affect you? Leave a comment below. We’re eager to hear your predictions.

 

Jeff Zimmerman is Vice President of Product Management and Marketing at Clearent. He has 15 years of experience in finance, marketing and product management, and has held management positions at Network Solutions and Intuit. Clearent is staying on the cutting edge of mobile credit card processing (http://www.clearent.com/financial-institutions/products-services/) and as one of the fastest growing merchant service providers, (http://www.clearent.com/about/) offers an array of different mobile payment solutions.

Normal Credit Card Processing vs. Next Day Funding Merchant Services

Many merchant services providers are adopting next day funding to grow their next day funding merchant services, and in a post last February, Carry Notheis explained many of the basics and benefits of this hot new service. However, despite the popularity of next day funding merchant services, many merchants don’t completely understand how it works. So to clarify this tricky topic, we thought it would help to compare next day funding to how credit card payments are typically processed by merchant services providers.

Normal credit card transaction processing
Typically, it takes two days from the time of sale for funds to appear in a merchant’s bank account. Say a boutique sells a blouse for $100 dollars on Tuesday afternoon, and after closing at 6:00 pm, the manager batches out and settles the terminal. That $100 (minus any fees) will be deposited in the boutique’s bank account on Thursday.

So what occurred between Tuesday and Thursday to make that deposit happen? Early Wednesday morning, the merchant service provider processed the debit and credit card transactions from Tuesday, submitted them to the card associations and initiated a transfer of funds to deposit the money into the boutique’s bank account. The money was then transferred via the ACH network. Because the ACH network transfers money between bank accounts overnight, the transfer occurred late Wednesday or early Thursday, and so the boutique received the funds sometime on Thursday during the day.

Next day funding
Now, using the same boutique example, let’s examine the next day funding cycle. If the boutique had next day funding, their merchant services provider would have processed the blouse transaction late Tuesday night and initiated the funds transfer to the ACH network Tuesday night before its last cut-off time. The ACH network would have transferred the funds overnight, and so the deposit would have appeared in the boutique’s bank account on the next day---Wednesday.

It sounds simple, but it can be tricky because each payment processor has its own processing and funding methods. Processors have to meet the cut-off time of the ACH network, and so they have to set a cut-off time for their merchants. This cut-off time varies from processor to processor because, depending on their systems and capabilities, some processors need more time to get everything in order to meet the ACH network cut-off time.

Furthermore, other processors may circumvent the ACH stipulations altogether. Collaborating with banks, they may “memo post” the transactions to the merchants’ accounts before the funds have really been transferred. This process relies on the policies of each bank and often requires funds to be held at a certain bank.

Jeff Zimmerman is Vice President of Product Management and Marketing at Clearent and has held management roles at Network Solutions and Intuit. Jeff brings 15 years of product management, finance and marketing experience to Clearent. Clearent is an experienced merchant services provider offering solutions such as mobile payment processing, wireless terminals, and next day funding merchant services. Learn more about how we can aid your credit card payments service and let us know any questions you might have.

 

4-Step Routine to Create the Best Merchant Services Program

We all have a daily routine, and whatever it may be, we consistently follow it. It helps us keep our lives in order. It makes us feel good. It just works.

And just as we should all follow our personal routines, Independent Sales Organizations (ISOs) and agents should follow routines of their own to get the most productivity out of their merchant service program. So to help you develop the best merchant services program possible, we’ve created this simple, 4-step routine.

1. Stay up-to-date

Like many other industries affected by the rise of the digital age, things constantly change in the world of merchant services. New technology is being produced, critical regulatory changes are taking place and your customers may be talking about you in a digital social sphere.

2. Make time to make sales calls

You know your portfolio isn’t going to just build itself. However, many ISOs fall into a trap of complacency when it comes to sales. They think that because their portfolio is adding to their bottom line, then there is no point changing anything. Building your portfolio with one or two successful merchants can do wonders for your profits. Yet to realize true organic growth, every day you should set aside a time to call prospective merchants and see if you can help them.

3. Follow-up with your customers

If your merchant has just been set up, call them to see how they’re doing and see if they need anything else. From a customer service perspective, staying in touch with your merchants is the best way to gain their trust and make them feel valuable. Managers of the best merchant services programs will consistently check on their customers.

4. Know where your merchants stand

It is important to know which of your merchants you’re at risk of losing. The best merchant services provider will be able to provide you with data that will help you figure out which merchants may be seeking a more profitable merchant services program. Additionally, checking on your merchants’ sales volume each day is a quick and painless process, and if you find a merchant that is dissatisfied, see if you can meet them halfway to salvage what profits you can.

Jeff Fortney is Vice President of ISO Channel Management at Clearent™. His career includes over 35 years in financial services, with the last 17 focused on the debit and credit card processing industry. As one of the best merchant services programs, Clearent is a valuable partner to many ISOs and agents. If you’re looking for a new partner for your merchant services program, Clearent will be sure to give you and your merchants high-quality service, competitive pricing and sought-after products and services.

How to Be Better Merchant Services Providers

No matter their size or industry, merchants should demand excellent customer service from merchant services providers. The best credit card processing companies know this, and do everything they can to ensure that their merchants are taken care of.

Although many companies do offer the kind of topnotch customer service that they claim, some fail at satisfying the consumer. They may think that their customer service is topnotch simply because there is no phone wait time and a building full of representatives in headsets answering calls immediately. Maybe they call their customer service “unmatched” because they have an “advanced troubleshooting program” and the representatives just have to read from a script.

Unfortunately, people don’t like feeling like they are being read to when they should be getting talked to, and people don’t really mind a short wait for a merchant service providers to answer the phone as long as the customer service experience is good. Not to mention that questions that aren’t contained in the computer script may arise during a call.

When something has gone wrong during a customer service call, customers don’t want to be formally addressed by their last name and profusely apologized to. They just want to know that the representative is doing everything he can to solve the problem. They want the customer service representative to show genuine concern for their problem.

The best credit card processing companies know that customer service representatives need to actually care about the problems of the customers. If a representative cares about the concerns of the customers, it will come through in his or her voice, and ultimately reassure the customer. Customer service representatives who care are also much more effective at solving problems because they want to see them resolved. It’s easy for customers to tell if a customer service representative is truly sympathetic to their situation or not.

They don’t want a customer service representative who speaks in a monotone voice or one that constantly uses industry jargon and big words to make them feel inferior. Customers want representatives to talk to them like normal people. Representatives of a merchant service provider can easily fall into industry-speak and forget that customers aren’t experts in their business.

The best credit card processing companies treat customers cordially, respectfully and honestly. Customers who have exceptional customer service experiences are likely to refer others to your credit card processing company just because of that one call.

All merchant service providers could benefit by reevaluating their customer service quality and revamp it where needed.

About the Author

Jeff Fortney is Vice President of ISO Channel Management at Clearent™. His financial services career includes over 35 years, with the last 17 focused on the debit and credit card processing industry. Clearent is one of the best credit card processing companies, providing passionate service that does not go unnoticed. Learn more about what merchant service providers can do for their clients.

Should merchant service providers attend trade shows?

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Should merchant service providers attend trade shows?

Whether or not to attend trade shows is a typical question that comes up among merchant service providers. The fact is, there is no simple yes or no answer. One has to analyze the cost to make a decision on whether the outcome will justify the expense.

 

There are five different trade shows in the world of merchant processing. The regional shows include those hosted by the Northeast Acquirers Association (NEAA), Southeast Acquirers Association (SEAA), Midwest Acquirers Association (MWAA) and the Western States Acquirers Association (WSAA). The Electronic Transactions Association (ETA) hosts the national show. To decide which to attend, it is good to have an understanding of the differences of what makes each show different.

 

 

Regional or National?

The regional shows are much smaller than the national show, and are even tailored to smaller ISO or MLS. In a large national show, smaller merchant service providers may be overloaded with an abundance of information – more than they can take in. However, in a smaller, regional show, they may leave with more great ideas for selling credit card processing solutions and information about the future of the industry.

 

Who should attend the show?

The more experienced the merchant service providers, the better. Although this may seem counterintuitive, it’s true. Trade shows will be filled with experts who understand the industry as well as the lingo. Attending a trade show before you’ve been in the business for a few years can be overwhelming. If you are overly excited to get started with trade shows and learning as much as possible, try working with a processing mentor for a year to increase you knowledge of credit card processing solutions beforehand.

 

Considerations Before Registration

Budget: Travel and hotel expenses can add up and they are the two largest expenses associated with regional shows. Typically, regional shows are inexpensive to attend as they generally only last one day. If the venue is close enough, you may even save more money by not having to book a hotel room.

 

 Expectations: Decide beforehand what you plan to take away from a specific show. Are you looking for any highly specified information? Have these goals and objectives in mind and remember that a trade show is a learning experience, not a vacation.

 

Look up any specific speakers prior to attending the show and come fully prepared to take notes. You may find yourself with many new credit card processing solutions and ideas. However, be sure to compare the possible takeaways with your budget to ensure that what you will be getting out of this outweighs the cost of attending – especially for national trade shows. 

It will be easy to get swept up in meeting new people and visiting the exhibits, but be sure to keep your goals in mind throughout the entire show.

 

About The Author

Jeff Fortney is Vice President of ISO Channel Management at Clearent. His financial services career stretches back over 35 years, with the last 17 years being focused in the debit and credit card processing industry. Clearent offers a variety of credit card processing solutions, including wireless options and next day funding. Find out how the right merchant service providers can make a big difference for your customers.

 

 

 

Merchant Credit Card Processing: Business & Profits Explained

After recently visiting a trade show and speaking with a number of people who were in some way professionally involved with a medium-sized bank’s credit card processing business, I learned an interesting piece of information that was a common factor among attendees. When I questioned the amount of money they were making from their merchant services program, the majority agreed that they weren’t profiting as much as they’d like.

After hearing this, I realized that others might be in a similar situation. I’ve outlined 3 reasons why you may not be making as much money as you would like, and how to grow your merchant credit card processing profits.

1.    Program growth is at a stand still

Think about the goals you originally set out at the start of the year. Are you reaching your portfolio objectives? The number of merchants you have may be influenced by your current sales efforts as well as how much effort you’re putting into your customer service or customer satisfaction program. Because you are trying to gain customers’ credit card processing business, be sure to have employees trained in customer service and are comfortable talking with future clients.

When it comes to growing your portfolio, it’s also important to think about yourself and whether you are getting the proper amount of attention from your merchant services provider. Do they call or visit you frequently and do they help you think of new ways to grow your portfolio? This is an important part of your merchant credit card processing partner’s job.

2.    Bottom line confusion

Your merchant sales volume ultimately affects the bottom line of your merchant services program. Your profitability can be directly related to each merchant and the branch level. Be sure to closely assess each merchant as a way to discover which customers are profitable, and which are not. Verify that each merchant is getting a satisfactory level of support.

It may be helpful to learn more about merchant service software to help with merchant credit card processing. Some merchant services providers offer software tools that include charts that can easily calculate the net profitability of each individual merchant within your portfolio.

3.    Market price regulation issues

Go through your portfolio and look at how you are pricing your merchants. Be sure that you are neither pricing too high, or too low. Both can have an impact on your financial wellbeing.

Remember, your pricing is dependent on what you are receiving from your merchant services provider. Your partner’s price could be too high, or perhaps you’re just not pricing your merchants high enough. To assure you are making the most of your profits, sit down with your financial partner and refresh your pricing plan.

Try implementing these three important tips and see if your credit card processing business begins to develop its profits.

About The Author:
As Vice President of Business Development, Kate Root is focused on helping Clearent expand its strategic ISO partnerships, as well as growing financial institutions’ merchant services programs. Kate’s 25 years in merchant services spans senior management roles in both issuing and acquiring, supporting financial institutions and ISOs. The right merchant service provider can help you increase your profits and reach your portfolio goals. Contact us for more merchant credit card processing needs.

 

Providing the Best Merchant Credit Card Processing Service

The word routine is most common in the part of our lives that encompasses the time we spend away from work. Be it making your breakfast, brushing your teeth or tying your shoes, a routine is something you do without even thinking. When it comes to the world of business, however, the word routine is less ubiquitous. Somehow the idea of doing something so many times that you don’t even have to think while completing it, rubs people the wrong way.

A routine does not have to be a mindless activity. On the contrary, it could be a very well thought out and executed task, the only portion that needs to be second nature is the initiation of the task.

In every industry there is a standard for success, and achieving this success is built upon growth – whether personal, financial or for your business as a whole. This is especially true in the highly competitive field of merchant services.

If a merchant services sales person developed a list of mandatory task he or she had to complete each and every day, these tasks would eventually become a routine. Not in the execution of these tasks, but in the initiation of them. Below is a list of tasks that, if committed to a daily routine, will set you on the right path becoming the best merchant credit card processing service.

1. Merchant Management
   Knowing the sales volume of each of your merchants will help you understand which of them are satisfied with your services and which are at risk of leaving. Addressing the high-risk merchants before they have left will build strong CRM as well as save you profits. Your merchant services partner should be able to provide you with reporting on you merchants.

2. Merchant Acquisition
   Growing your merchant services program rarely happens on its own. Bringing in new merchants takes time and effort. Dedicating a portion of every day to calling new merchants is the most reliable was to improve your current portfolio.

3. Merchant CRM
   Acquiring new business is only half of the equation. Following up with them is equally important. Customer relationship management should be added to your schedule each and every day.

4. Staying Relevant
   The merchant services industry is one that is always changing. This means that in order to be the best merchant credit card processing service and to stay relevant to your merchants, you must stay informed. Setting aside a few minutes of your day to look up industry terms, new technologies and what your competitors are doing is a great way to stay on top.

The common belief is that is takes 21 days of repetition to turn something into a routine. When thinking about next month’s schedule, it may be ideal for you to add each of the listed items above to your daily checklist. What may start as being something time consuming and tedious will turn into something that is simple and the driving force that is turning you into the best merchant credit card processing service in your industry.

New Merchant Services Software Gaining Popularity

If you are not familiar with Square you should be, as it is one of the most highly acclaimed merchant services around today. Square recently developed a mobile wallet called Card Case, which is an app that allows you to purchase items directly from your mobile device. This new merchant services software has not generated the popularity that its mother company Square has, but the trend is gaining buzz in select businesses and markets across the nation.

Getting started requires that you make an initial visit to the business and register your information. Then the next time you return you will be able to “start a tab” as soon as you are in range of the store and order. For example, once you pull into the parking lot you can start a tab while sitting in your comfortable air-conditioned car with your favorite music playing. The cashier will then find your information when you pick up your order and that’s that, no need for cash or a card as the transaction has already been made and will appear in the history tab of your Card Case app.

While this is a neat app for small take-out businesses, it’s difficult imagining it moving to the mainstream of merchant services software. The setup is somewhat annoying, in that it requires you to visit the business to set up an account and then make a second visit before you can actually use it. Also it will be hard to get people to use it over cash or a typical card-based payment because Card Case isn’t really that much of a time saver. Unless of course the business is insanely crowded, then sitting in your car greatly trumps a long line.

The mobile wallet has in no way become an ordinary method of payment. However, if businesses paired its use with an incentive of some kind, a coupon or product give away, it would become more desirable to consumers. But with the rapid growth of mobile payments, it will be interesting to watch the changes unfold.

Procrastinate No More: Make Decisions Today – NOT Tomorrow

The easiest way to eliminate today’s “to do list” is to put off items for another time. Be it a simple task like mailing some thank you cards or a life changing decision like planning your retirement options, it is much more simple to push it back rather than sitting down and working on it. Procrastination often occurs when a task is either too menial to matter, or is so daunting you don’t know where to start.

It is the latter that hurts people more in the long run. A common complaint among today’s banking industry involves providing merchant services for small businesses. Although many bankers report being unsatisfied with their current merchant services provider, there is little turnover. Starting the process of finding another provider or fearing the result from confronting them prevents many from finding a provider they like. Similar scenarios are found in all professions, and all have negative results, the most common being merchant attrition and reduced income. So how can procrastination be overcome? 

When dealing with this problem it is important to examine the products and services offered to your clients. Are these products innovative? Does each member of your company have a thorough understanding of these products? Is your provider staying on top of the industry? These are all questions that should be addressed on a regular basis. 

Reviewing your portfolio is your next step. Knowing the state of your portfolio at all times is key. Is it growing or shrinking in terms of total revenue and your total number of merchants? One simple way to find out where your portfolio stands is to conduct a portfolio check up. This will help you keep your finger on the pulse of your business.  

Aggregation of information is the next huge hurdle. With so many sources to choose from, most wonder why they should even start. However, quality information can often come from individuals you already know. In the case of our banker friends who can’t find the right provider, starting information would actually come from the provider they’re currently using. Your merchant services provider should have all of your pricing information at their finger tips, including your Schedule A. They should also be able to provide you with a current profitability report.

Your own team members are a good source to determine exactly how well you’re doing in your own market. Are you adding merchants at a rapid pace? Are your products competitively priced? Answering these simple questions takes little effort, and will jump-start your work on what has previously been an undesirable task.

Find a niche as a merchant services provider

If your approach is still broad when it comes to finding new merchants, you may find that you are losing business to competitors who have tactically focused on a particular niche in the industry. It’s my recommendation that you reevaluate your strategy and brainstorm ways to differentiate your service from your competitors.

I spoke to many ISOs in early March 2011 at the Southeast Acquirers' Association (SEAA) 2011 Annual Conference in Weston, FL. I was enamored by the fact that a large percentage of the ISOs in attendance no longer thought of themselves as a general merchant services provider. They have moved their focus to a niche segment of the market and offer a unique and more tailored solution to successfully target specific merchants.

So what is a niche exactly? Well, Merriam-Webster defines a niche as “a place, employment, status, or activity for which a person or thing is best fitted” as well as “a specialized market.” I like to consider it as focusing on something you do very well – better than your competition – instead of trying to provide everything for everyone.

If you are wondering what some example niches for an ISO might be, let me start with a few examples that were brought to my attention at the SEAA 2011 Annual Conference. One gentleman is in the process of starting a new ISO focused on point-of-sale solutions. He is planning to help merchants find the right software/hardware to meet their needs, and the merchant account is what comes along with it. Another ISO had the idea to create a loyalty program to use as a lead for new merchant acquisition and to help with customer retention. A third ISO focuses on businesses that create POS and other related software used by merchants to help integrate his merchant services into their software.

While each approach is different, they all have something in common: they make sure to focus on a niche rather than a shotgun approach in addressing the merchant services market. Given the highly competitive nature of our business, their approach makes sense.

• How will you find your own niche as a merchant services provider? Here are additional examples to consider:
• Specific merchants (e.g., medical offices, contractors, auto dealers, e-commerce)
• Products (e.g., gift cards, mobile payment devices, plug-in for QuickBooks)
• Geographic (e.g., new communities, small towns with less competition)
• Cultural (e.g., Spanish-speaking merchants, your local ethnic hotspots like a “China town”)

To help identify your niche try asking yourself the following questions:

• Which merchants are providing the most referrals?
• What am I receiving the most compliments on?
• What do I feel is my strength?
• Which merchants and products excite me the most?

Really take some time to think of potential niches that fit you well. Chances are you will find it will make you more efficient in finding leads, closing them, and retaining your merchants. If you like the content of this post, please be sure to visit and subscribe to our payment processing blog for ISOs.