Visa posted positive double digit gains and says it will “live forever with less share than we once had” due to government regulations.

Visa reported “very vibrant transaction growth rates in U.S. (consumer) credit” and also noted that their commercial credit card side is growing at a good clip. As expected, debit volume declined as banks deemphasized debit and removed rewards programs associated with debit cards that once played an important role in driving volume.

Visa also said “the U.S. Department of Justice Antitrust Division issued a civil investigative demand requesting additional information about PIN-authenticated Visa Debit and elements of our new debit strategies, including the fixed acquirer fee.” Visa says it is confident their actions are appropriate.

As you know, Vantage provides the most transparent, direct pass-through of the payment industry’s universally established Interchange, Assessment and Access fee schedules.

This April, a whole new set of card fees are being introduced. Vantage reports on and tracks these industry fee changes as they occur on our web site and this resource is often use by reporters and market analyst as well as merchants, businesses and banks. We also post about the payments industry and card Interchange on our blog. In July 2011 we first alerted merchants to the Visa announcement to charge a new location fee.

Vantage passed through all the Fed regulated debit rates to our clients. We posted a Vantage Study Revealing the Results of Fed Regulated Debit in October. And while Vantage clients took advantage of the savings immediately, most Small Businesses are Missing Out on Debit Interchange Savings.

With these new fees, Visa is responding to government regulations that require all debit cards to have two unaffiliated network choices. Visa is lowering it’s per transaction access fee (Vantage is passing this savings on to our clients) and is instead implementing a fixed acquirer fee. Visa hopes to encourage merchants to route more transactions to Visa (a monthly fee divided by more transactions equals lower overall per transaction pricing), or so the story goes. This article in an industry trade journal discusses the reaction to these industry wide changes from the Electronic Transaction Association. Here you can listen to expert commentary on how card fee structures are changing in response to government regulations on debit.

Overall, if you accept lots of too-big-to-fail bank debit cards you should still come out ahead. If your customers don’t use debit cards, chalk these new fees up to more unintended consequences of government regulation.

Global Payments identifies and self-reports unauthorized access into a small portion of its processing system limited to track 2 card data only (no track 1 card data, no names, no social security numbers and no bank account information was compromised).

Global Payments reports incident does not involve our merchants or their relationships with their customers. Global Payments continues to provide uninterrupted processing services.

ATLANTA March 30, 2012 – Global Payments Inc. (NYSE: GPN), a leader in payment processing services, announced it identified and self-reported unauthorized access into a portion of its processing system. In early March 2012, the company determined card data may have been accessed. It immediately engaged external experts in information technology forensics and contacted federal law enforcement. The company promptly notified appropriate industry parties to allow them to minimize potential cardholder impact. The company is continuing its investigation into this matter.

“It is reassuring that our security processes detected an intrusion. It is crucial to understand that this incident does not involve our merchants or their relationships with their customers,” said Chairman and CEO Paul R. Garcia. 

For more information please visit www.2012infosecurityupdate.com.

Like his previous article discussing the merchant services industry, Michael Conticelli has done it again with a must read insightful report in the Ft. Myers Small Business Examiner titled “New trend in merchant statements hides rates and fees”.

Michael specifically calls out SunTrust for purposely redesigning their merchant statements to eliminate all rate and fee detail, leaving merchants no clue as to how charges are calculated. SunTrust made the decision to keep merchants in the dark about their “surcharge fees, bill backs, annual fees, PCI fees, etc.” because when merchants “don’t actually see the rates and fees month after month” they can’t ask questions.

Michael warns “Merchants need to be vigilant in monitoring their merchant fees.”

We couldn’t agree more! In fact, Vantage Card Services takes the exact opposite approach with our clients. Not only do we provide a very detailed merchant statement, we also provide our PayView analytics tool to help merchants explore stats and trends, chart their sales, manage their Interchange qualifications and track their effective "real rate" calculations month after month.

PayView is a user-friendly dashboard and analytics reporting tool that merchants can use to gain greater insight and more transparency into the cost of accepting card payments. This added layer of business intelligence empowers our clients with a greater understanding of where fees come from, best practices to keep costs down and a historic tracking of processing expenses.

Read more and take a tour at http://vantagecardservices.com/payview.

Vantage Card Services [+] is a new merchant services portal for our valued clients to track and redeem their Vantage Points Rewards, explore PayView reporting and trends and access Support Center resources.

Vantage is home to world-class payment solutions and features the best value package of price, terms, service, solutions and incentives available in the payments industry. This new merchant service [+] portal complements our Interchange [+] merchant rate pricing with PayView reporting.

PayView is a monthly reporting tool that has been developed to provide even greater transparency into your card payment acceptance. Use PayView to explore stats and trends, chart your sales, manage your Interchange qualifications and track your effective "real rate" calculations over time. We welcome you to log on or register for a demo of PayView now.

VantageCardServices.com is also the new home for Vantage Points Rewards. As a Vantage merchant, you earn Vantage Points when accepting card payments and for your referrals. Shop online and redeem your points for great rewards from hundreds of distinguished reward partners while also helping us raise money to support the fight against ALS.

Our passion is providing high quality payment processing solutions that exceed expectations. We are continuously working on improving our programs, technology and service offerings to provide the best value available anywhere in the payment industry. And the Vantage Card Services support center resources, Vantage Points Rewards and PayView Reporting are demonstrations of our continued commitment to our clients.

We Thank You for Choosing Vantage Merchant Services!

Update 3/3/2011:  MasterCard is creating new small ticket Interchange charge types as discussed below but NOT introducing new rates.  MasterCard is implementing these new buckets for small ticket likely so they can track the volume separately from other regulated debit transactions.  We expect that companies like USA Tech will continue to opt out of accepting MasterCard debit until they lower the small ticket debit Interchange rate. 

Vantage Card Services specializes in providing card payment processing services at direct and transparent Interchange pricing to merchants and businesses of all sizes.

For our B2B and B2G clients, VantageB2B.com is a resource focused on the payment acceptance policies, strategies and best practices to lower cost, increase productivity and enhance security. An integral part of our service is helping our clients manage Interchange qualifications when accepting commercial card payments. Given this B2B processing focus, we are particularly engaged with the recently announced Interchange modifications by Visa to become effective April 2012. We work with clients daily to establish and manage Level 3 merchant services. A significant number of Interchange modifications have been announced impacting Visa commercial card rates.

• Visa will make changes to their existing Corporate Card Level 3 and Corporate Electronic with Data Interchange programs.
• Visa will implement a new P-card product and associated Interchange Fee programs that will be available to commercial card issuers in the U.S.
• Visa is making changes to existing Interchange rates in their business, corporate, commercial and purchasing card categories as well with the most significant change coming for the Purchasing Card Large Ticket category that today requires a Visa registration fee.
• Visa will separate its non-regulated Business debit card from Business credit programs.

Another interesting and potentially significant change was announced from MasterCard. MasterCard will introduce new Regulated debit small ticket debit and credit Interchange programs in April 2012. While we don’t yet know the specific details, for companies like USA Technologies this is a welcome development. 

Vantage is home to world-class payment solutions and features the best value package of price, terms, service, solutions and incentives available in the payments industry. For more information, follow Interchange developments as they happen here.

Effective immediately, registration is no longer required for merchants that accept MasterCard who choose to accept Debit MasterCard Cards only, Other Cards only, or both Debit MasterCard Cards and Other Cards. At this time, Visa still requires registration of merchants who wish to limit acceptance to debit or credit only.

In an examiner.com article yesterday titled “Merchant service providers are the real winners under new debit fee caps”, Michael Conticelli highlights that processors are not required to pass on the lower Fed regulated debit Interchange rates – and because of this small businesses are not realizing the benefits of this legislation.

Thanks Michael for helping call attention to this small business issue. Ever since this debit Interchange debate started we have been advocating for small businesses because we knew that while they were held up as the face of this legislation by mega retailer lobbyist, that the system was rigged against them.

In October 2011 when the Fed debit rules went into effect, we posted "Durbin’s Debit a Trick or Treat for Small Merchants". Michael writes “Some banks and processors have tried to trick their business customers into thinking they are getting the savings passed on by lowering rates at only a fraction of the full savings.” To avoid the tricks, Michael advises “The only way a business can be sure you are getting ALL of the savings passed through is through the Interchange pass through pricing model.”

Two years before, in October 2009, Vantage wrote More Intelligent Merchant Rates, calling for all merchants to move to Interchange pass through pricing. The bottom line we posted “is that while the lawyers, lobbyist and politicians earn their living arguing over Interchange, merchants should take more immediate action on the things they can control today. Shop smart and choose your payment partner wisely.” In fact, since 2005, Vantage has monitored, recorded and reported on Interchange changes impacting merchants. All merchants, large and small, can get Interchange pass through pricing. And Vantage is passing all the Regulated Debit savings on to our clients (and released a study of the results by industry).

To receive a customized merchant Interchange rate quote instantly delivered to your inbox go to http://merchantrates.com.

A recent article “Why Banks Shun 30 Million Americans” makes the case that banks are uninterested in the unbanked and underbanked customer and that mega-retailers don’t offer much long-term value.

New federal regulations have impacted the banking industry’s business model of subsidizing once “free” services, driving banks to focus on “profitable” customers while discouraging others with higher fees on basic banking services.

Big retailers have stepped in to profit on the unbanked by charging fees to cash checks and by selling prepaid debit cards. Retail fees charged for these services, when added up over time, can be just as high as maintaining a checking account.

Yet one of the best solutions for the unbanked and underbanked was not discussed at all: Employer paycards. Unlike retail prepaid cards that carry load and usage fees that make it profitable for retailers to sell them, employer paycard programs offer all the benefits with much lower costs.

For example, our employer paycard program is a completely free service to employers, with no contracts; no set up fees; no card fees and no minimum number of cardholders. Employers can lower expenses associated with “paper” payroll and mandate direct deposit while complying with all "pay without discount" regulations. Our full deployment program meets state regulations and provides cardholders with a Visa paycard with:

• No Monthly Fee
• 1-Free Teller Withdrawal per Pay Period (true pay to the penny compliance)
• Toll Free Balance given automatically when calling the number on the back of the card

In fact, our cardholders can realize all the benefits of having a paycard and not incur any fees.

• Free Payroll Card Enrollment
• Free Signature Purchases
• Free Online or Phone Purchases
• Free Debit Purchases
• Free Debit Purchases with Cash Back
• Free Online Access

Given that every legal US resident qualifies - banked, unbanked and credit-challenged employees are starting to take the initiative to find and introduce paycards to their employer.

We encourage employers and employees alike to pilot our Visa paycard.

It’s what all merchants are looking for; who doesn't want the “best merchant rates”? The real question for merchants is how to go about achieving this while avoiding the pitfalls of selecting a poor service provider.

To be the best, can you just claim it or buy the best domain name? The Best Merchant Rates may be an SEO search term, but a company name? Isn't that like naming your company “the best cola” instead of Coke or Pepsi? Do you trust a financial services company with a generic company name like “Merchant Services” or do you go with brand names like Bank of America or Costco?

For small businesses looking for the best merchant rates, turning to mega-banks and mega-retailers is not their best choice. For example, Bank of America Merchant Services advertises heavily with an asterisk. Interestingly this same bank, until public pressure forced it to change course, wanted to charge customers $5 a month to use a debit card. The Ellen Show posted this hilarious message from Bank of America. It would be funny if it wasn’t true of the mega bank approach to payment services. And Bank of America has been running commercials touting its "cash rewards" credit card “offering no annual fee, a $50 sign-up bonus, then a 1 to 3 percent cash refund on your spending”. Mega banks are trying to steer your customers to pay with credit cards over debit cards with the result that merchants will end up paying more in Interchange fees when accepting card payments. Sounds like a conflict of interest to us. Alternatively, will you turn to a mega retailer, who fought for lower Interchange for themselves but oddly isn’t passing the regulated debit Interchange on to the small businesses it’s marketing to? Costco’s fine print for its “rate-as-low-as” offer is followed by an asterisk that reads in part: “Rates listed are for qualified transactions. Reward cards process at a higher rate. A monthly minimum charge applies when qualified transaction fees and per-item charges are less than $20 per month… Rates and fees may change without notice...” etc. with even more fine print terms and conditions.

Does your search turn to the internet? What keyword phrase do you enter into your favorite search engine? Are you searching for the “best” merchant account or perhaps the “best” merchant service? And how will you know the best when you see it? To complete this task you will likely begin to get offers and compare discount rates and fees. In a merchant account comparison, how do you choose the best merchant services vendor for your business? Do you make a decision solely on the best merchant rate quote or do you take other factors into consideration?

Here is our best practice recommendation for all merchants to consider when shopping for merchant services:

1. Insist on an Interchange pass through pricing model (keyword search: “merchant Interchange rate quote”).
2. Insist on a month-to-month term (keyword search “month to month merchant account”).
3. Insist on open platforms verses proprietary processing systems designed to lock you into not being able to easily move to another vendor. Many providers sell (or worse…lease) proprietary bankcard terminals that will only work if you continue to process with them. Others follow this same model with payment gateways that once integrated into your point of sale or ecommerce platform leave you with a single processing choice (and we all know what happens to prices when there are no competitive pressures and no other choices).

Once you identify service providers that meet this criteria you can then begin your comparison. Important note, please don’t trust the “marketing” proposal but instead read all the fine print for yourself before you sign any application!

With so many credit card processing companies in the market, and without adequate knowledge of the payment industry, it can be hard to decide which merchant services provider is the best for your business. If you are shopping, please read these testimonials and include Vantage Card Services in your RFP. Vantage provides a host of online resources and personal consultations to help small business. On MerchantRates.com you can get an instant Interchange rate quote and customize the proposal specifically for your business. There is a buyer’s guide with frequently asked questions as well as numerous resources to help you gain a better understanding of the industry’s Interchange schedules.

Please share your experiences and most effective shopping strategy with us here.