Our 2013 Top 5 Credit Card Processing Picks
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Evolution Bankcard is a leading credit card processor offering competitive rates for all business types—from brick and mortar to ecommerce to merchants on the go processing with smartphones. Founded in 2005, Evolution has become one of the strongest branches of its parent company, EVO Merchant Services, which processes 400 million transactions annually for more than 300,000 businesses, conducting $32 billion in volume. The company boasts an A+ Accredited Business rating from the Better Business Bureau and processes payments for... (Read More)
More than 115,000 business owners rely on the credit card processing services of Merchant Warehouse. The company was founded in 1998, with the basic premise that a business should have access to credit card machines and merchant accounts at affordable prices. Merchant Warehouse has an A+ rating with the Better Business Bureau. (Read More)
The change came amidst the $7.25 billion settlement Visa, Mastercard and a slew of major banks agreed to pay out to retailers nationwide. Included in the terms of the settlement was a provision allowing businesses to pass surcharges onto customers so long as a notice of the practice is clearly displayed at the entrance of the business, at the point of sale and itemized on the receipt.
Over the years, a handful of states have passed legislation to explicitly prevent such practices, including California, Massachusetts and Florida, even though the practice has always been outside of Visa and Mastercard’s guidelines. Many small businesses across the country have ignored this, choosing to tack on a flat rate of 50 to 75 cents to each transaction, which many customers begrudgingly pay.
Now, Lawmakers in 11 states have introduced legislation to protect consumers from potential credit card surcharges, including Tennessee, Vermont, South Carolina, Kentucky, Hawaii, Pennsylvania, Missouri, Rhode Island, New Jersey and Utah.
Though this legislation may be welcomed by consumers, the National Retail Federation, who protested the settlement, said to NBC News that it was “a waste of the legislative process.” The federation, which represents retailers nationwide, believes legislators’ time would be better spent bringing “greater competition into the marketplace by prohibiting the price fixing of the hidden swipe fees merchants pay to process credit card transactions.”
The lawsuit was brought about in 2005 after a group of retailers accused the processing giants of anticompetitive behavior by secretly colluding to fix processing fees, thus inhibiting fair competition in the marketplace.
Be sure to check back with CCP.net for continuing coverage of the proposed legislation.
Beginning January 27th, 2013, merchants will be allowed pass surcharges onto customers utilizing a Visa credit card in states that haven’t explicitly made the practice illegal. The change of terms comes in the wake of the $7.25 billion settlement that Visa, Mastercard and a handful of large banks will be paying out to merchants across the country.
Merchants that choose to pass these charges onto consumers must post notice of these charges at the entrance of the store and at the point of sale or interaction. Additionally, the surcharges cannot exceed 4 percent of the total transaction and the dollar amount of the surcharge must be included on the receipt that merchants provide to customers.
The preliminary approval of the settlement by the United States District Court for the Eastern District of New York provides certain allowances to merchants before final approval, which has been deferred and is expected in late 2013.
Merchants that haven’t illegally embraced the practice already will now face the dilemma of whether they’d rather continue to pay out large amounts for the service or risk losing customers who object to their new policies. If you’re interested in knowing what percentage of businesses plan on passing surcharges onto consumer, vote below and see the results!
For more information on Visa’s new surcharge polices, visit their Operations and Procedures disclosure here.
A new poll conducted by market researching firm Harris Interactive has found that American consumers are anticipating mobile payments will replace both plastic cards, and eventually cash.
Two thirds of respondents (66 percent) believe that mobile phone payments will become preferential to plastic card and 61 percent think that phone payments will eventually replace cash.
Some may say these trends spell doom for cards themselves, but many consumers have expressed fears of identity theft and other security issues related to accessing sensitive financial information through their smartphones. And interestingly enough, some credit card issuers are developing technology to enhance security and provide new functionality options on plastic cards. (more…)
The nation’s largest brick and mortar book store, Barnes and Noble, has announced that pin pads on credit card terminals in 63 of its stores have been hacked to steal customer information.
The number of breached accounts is currently unknown, but the New York Times has reported that unauthorized purchases have been discovered on some of the compromised accounts.
The infiltration was discovered on Sept. 14, after which the company immediately disconnected all pin pads in all of its stores nationwide. For now, customers will have to hand their debit or credit cards over to clerks to be swiped for all transactions.
The company is assuring customers that its online transaction and those made with the company’s Nook devices are secure, including its customer database. (more…)
The Visa and Mastercard $7.25 billion settlement was submitted to United States District Judge John Gleeson for approval, on Friday, in what could end up becoming the largest antitrust settlement in the history of the country.
The settlement has stirred a large resistance among the plaintiffs, including the National Grocers Association, National Retail Federation, Wal-Mart Stores and Target Corporation, who claim that the agreements of the settlement do little to stop Visa and Mastercard from raising fees in the future.
History of the Case
The seven-year-old litigation arose from businesses that claimed Visa and Mastercard colluded with each other in preventing businesses from passing the credit card swipes imposed on them by the processing giants over to their customers. Swipe fees can range between 1 and 3 percent, which sets the vast majority of businesses back substantially each year. (more…)
Apple’s Passbook, a new app that accompanied the release of iOS 6, has generated a lot of buzz as of late — not so much in relation to what it currently does, but rather its potential — the ability to dominate the mobile payments market in one fell swoop by connecting the 400 million active credit cards from the iTunes store to the new app.
Lo and behold, Apple is planning on testing that functionality in the immediate future by allowing consumers to make purchases at Apple Store locations through Passbook within weeks by adding the ability to upload Apple gift cards to Passbook. It’s a small step, but this could have gigantic implications.
Groupon officially launched its new point-of-sale business, Breadcrumb, this week pulling it out of the beta stage and allowing the public to enroll.
Breadcrumb acts as a comprehensive business solution, integrating the ability to make reservations, place an order, email or print receipts, provide data on real time sales, track employees’ shifts and now fulfill Groupon’s famous deal-of-the-day offer.
Signs of Things to Come
The service has been anticipated since May earlier this year when Groupon strategically acquired Breadcrumb, not-so-subtly announcing its intentions to its evangelical small business adherents and burned detractors.
Breadcrumb costs $99 per month and it’s an additional $100 per in-store iPad. Businesses can also purchase a bundled package that includes a cash drawer as well as printers for purchase receipt and kitchen tickets. (more…)
Walmart has teamed up with American Express to offer a new prepaid debit card, Bluebird, which they claim is “loaded with features, not fees.”
The move comes in the midst of ongoing tensions between consumers and banks, promulgated through arbitrary fees and the slow dissolution g of free checking. Americans considered “under-banked” has been on the rise as of late, but in a digital payment age, solutions for consumers who wish to circumvent what they deem as burdensome fees seem to be popping up left and right.
Enrollment and Setup
Enrollment with Bluebird is free if done from their website — those who wish to enroll at a Walmart store are charged a nominal account set up fee.
The allure of Bluebird rests in the fact that the American Express brand is accompanied by an unspoken connotation of being up scale, and since not everyone can qualify for one of their credit cards due to poor credit history, this gives consumers a chance to establish themselves with the company and most importantly, conduct digital transactions where Amex is accepted. (more…)
edō, Inc., the company that’s bringing discount offers directly to credit cards, has brought in another $15 million in venture funding, bringing their total to $54.3 million. The company is taking a straight-forward approach to linking coupons to credit cards instead of the current industry trend of linking them to smartphones. CCPnet took the opportunity to find out more about the company and was obliged by its CEO, Ed Braswell.
CCPnet: How was edō conceived and by whom?
Braswell: I was looking at coupons through the eyes of a typical shopper – my daughters, who never clip a coupon (but do like to shop!) – realized there was an opportunity to market to consumers who like value, but don’t turn to Sunday circulars for their discounts and deals. By thinking about the long term capital needs and opportunities for an offers platform company, I embarked on the adventure that is edō. (more…)
The opposition to Visa and Mastercard’s $7.25 billion settlement gained another ally this week as the National Retail Federation joins the National Grocer’s Association in renouncing the terms and even threatening to block the settlement.
The settlement, which leaves many doors open for Visa and Mastercard to continue with their anti-competitive behavior, still needs approval from the judge presiding over the case by Oct. 19. The seven year old case was sparked by merchants who claimed Visa and Mastercard colluded in blocking merchants from passing fees on to customers, something that they claim eats away at their profits.
Other major companies to join the NRF and NGA are Target and Walmart, two of the largest retail chains in the country. Even Sen. Dick Durbin has spoken out that the terms are unfair. The terms leave out any language that would cap the swipe fees, which many believe is a loophole that Visa and Mastercard will use to recoup their losses in the not-too-distant future.
As it stands now, considering the amount of opposition, there is a good chance the settlement will be rejected and may be forced into renegotiations, unless they choose to move forward with the litigation. Be sure to check back with CCPnet for updates on this case.
Online transaction leader PayPal has teamed with Discover, the nation’s 4th largest credit card issuer, to bring the eBay subsidiary payment transaction service more than 7 million brick and mortar stores by spring of 2013.
PayPal users will need to link their account to a Discover card, which will then take those transactions and run them through PayPal allowing users to choose to pay by credit/debit cards, bank account, or funds currently held within PayPal, and will even allow coupons and gift cards to be utilized.
Each user will be given a unique ID number and will have to create a four-digit pin number to verify transactions. Consumers will also have an option to connect their mobile phones to their accounts and use their phone number to make purchases. (more…)
A recent poll commissioned by CreditCards.com found that 65 percent of Americans would utilize a different payment option if retailers start passing off credit card surcharges onto consumers.
The study comes after news of a potential settlement between nearly 7 million retailers and Visa, Mastercard and a handful of large banks. One of the major agreements of the settlement would allow merchants to pass surcharge fees onto consumers instead of swallowing the fees themselves, something Visa and Mastercard have barred in years past.
The survey, which was conducted by GfK Roper Custom Research North America, contacted more than 1,000 credit card holders and asked whether they would pay the added surcharges. The findings varied dramatically by age group.
Adults under the age of 35 were the most likely to disregard the surcharges, with only half saying they would use another payment option. In the 35 to 49 year old age group, 63 percent would pull out cash or their debit cards and 70 percent of those 50 and above would do the same. (more…)
Senator Dick Durbin, the author of the Durbin amendment to the Dodd-Frank Act, which capped debit swipe fees at 24 cents per transaction, has come out and voiced his opposition to the pending Visa and Mastercard settlement, citing that the terms don’t do enough to prevent price collusion in the future.
“The settlement does nothing to change the anticompetitive fee-fixing that Visa and MasterCard do on behalf of their member banks,” Durbin said. “In fact, it gives Visa and MasterCard broad and permanent legal immunity to continue doing exactly that in the future.”
The seven-year-old litigation, which lists over 7 million plaintiffs, is an attempt to quell sizable credit card processing fees that merchants have paid in the past by allowing them to pass the fees along to customers, a move which is currently barred by both Visa and Mastercard. (more…)
The mobile payments market is rapidly evolving — small start-ups are taking on the established processing behemoths in a race where winner may take all. Adoption of mobile payments has slowly, yet steadily increased in the United States recently, and with so many companies clamoring to outshine their competition, it is apparent many businesses are counting on mobile payments to be an integral part of the near future and are even hoping to make credit cards obsolete. The convenience and incentivized rewards offered to both merchants and consumers cannot be ignored for much longer by savvy businesses and smart shoppers.
Enter LevelUp, a payment processing service that has a one up on all other payment processors: they’ve done away with pesky merchant transactions fees which are instead reinvested into their business by creating discount and incentive campaigns to increase consumer interaction. The company has recently raised $21 million in venture capital due to their bold, yet clever approach to payment processing. (more…)
The National Grocers Association, along with Wal-Mart Stores Inc. and Target Corp., are raising their voices in concern over the pending $7.25 billion settlement Visa, Mastercard and a slew of big banks are expected to payout to the plaintiffs in the case.
Settlement Doesn’t Add Up
The NGA asserts that little is accomplished in affecting the anticompetitive claims put forth by the prosecution and the settlement’s monetary compensation only covers a fraction of the $350 billion worth of swipe fees the processing giants have collected since the lawsuit was filed in 2005.
“This proposed settlement agreement fails in this regard by allowing Visa and MasterCard to continue their dominant anti-competitive practices,” NGA President and CEO Peter Larkin, said. “Meanwhile, merchants and consumers will continue to pay exorbitant swipe fees with no hope of reform. NGA’s members are also concerned about Visa and MasterCard’s ability to use their dominance to prevent emerging and innovative lower cost payment options.” (more…)