Archives / 2011 / October
  • Durbin’s Debit a Trick or Treat for Small Merchants

    Merchant statements soon to reveal who gets savings from lower debit Interchange.

    Next week, most merchants will get their first chance to see if they saved money on their card processing fees due to the Fed’s mandated lower debit rates that took effect October 1st. Typically merchants receive monthly statements at the beginning of each new month showing both processing activity and how fees were applied. Some merchants don’t open their statements and many merchants don’t understand how to read them when they do, but clearly if there was ever a statement to pay attention to, it would be the October statement that’s about to be delivered.

    Merchant service providers are not required to directly pass the reduced rates of the Fed regulated debit transactions (and the … more

  • Visa’s Network Participation Fee scheduled for April 2012

    On the Visa Q4 2011 Earnings Call yesterday, Visa stated "We're also moving forward with our modified debit economics, including the implementation of our network participation fee and the reduction of variable acquiring fees on debt, Visa debit and Interlink. As stated last quarter, we believe this offers merchants greater incentive to route transactions over our network and an opportunity to lower their per-unit transaction costs. As for details, we anticipate providing the specific pricing information to merchants and acquirers in January, which will go into effect on April 1." more

  • DepositGuard offers new and improved Property Rental Payments

    DepositGuard is a payment technology platform for property rental payments that securely collects, holds and administers the deposits and pre-paid rents for vacation and residential property transactions, benefitting both renters and homeowners (including landlords, property managers and rental agents).

    Unlike other payment methods, a merchant account is not required to accept Visa/MasterCard payments and there are no fees for homeowners to use DepositGuard.

    DepositGuard is a neutral third-party account where the rental funds are parked for safekeeping. Both the renter and landlord have full visibility into the account and must be in agreement before the account can be created, changed, closed and any money released.

    DepositGaurd gives renters more control over the payment process by … more

  • Will the banking industry apply a little Steve Jobs creativity?

    So far the initial reaction to the Fed regulated debit Interchange from the major banks has been anything but creative. Predictable yes; creative no. We've seen many regulated debit card issuers adding restrictions to free checking and ending debit card reward programs. And Bank of America, JPMorgan Chase, Wells Fargo, SunTrust and Regions are all trying out variations of imposing new debit card usage fees on cardholders. These strategies are like adding a fee for paper billing statements to encourage the switch to e-statements, yet it’s hardly creative.

    Steve Jobs was a master at consumer-driven markets and a great innovator who turned iTunes into a successful micro-payment platform. Surely we should expect bank innovators to adopt more creative ideas, right? For example, we know … more

  • Interchange pricing is the key to merchant savings

    Have you noticed the media blitz over what’s being referred to as ‘Durbin Dollars’, the savings from lower Fed regulated debit Interchange rates? Of course the best way for merchants to realize the benefits of this legislation is to have an Interchange pass through pricing plan. At Vantage we have been evangelizing direct Interchange pass through pricing schedules (and working with merchants on managing their Interchange qualifications to lower their bottom line card processing costs) for over a decade. In the first paragraph of our October 2000 home page we advised merchants on the concept of “Interchange qualification management”. Seriously, who else was talking with merchants about managing Interchange back in 2000?

    Your card processor is not required to … more

  • Visa ends Credit Voucher Interchange for debit transactions

    Another over looked consequence of the debit Interchange revisions, effective October 1st, is the impact on cardholder refunds due to changes in the Visa ‘Credit Voucher’ program.

    Visa has made modifications to its Credit Voucher Interchange fee program to coincide with other operational changes to comply with the new debit regulatory requirements ushered in by the Federal Reserve such as capping regulated debit card Interchange rates.

    Credit Voucher Interchange fees are paid to the merchant acquirer (processor or service provider) by the card issuer when cardholder refunds are processed. This is the reverse of what happens during a sale transaction where the merchant pays a discount rate to accept the card payment.

    With this Visa adjustment, the processing volume for debit … more

by Ty Hardison

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