Large Ticket Transactions

 Who would ever accept a large transaction on a credit card? The cost would be outrageous.

 Not so fast. Large Ticket transactions fall into a Special Industry Rates interchange category that make this type of business to business payment very attractive. The interchange rates can go as low as 0.40% for transactions over $500,000.00.

 The obvious advantage at that point is that the cash is in the bank in one to three business days. No more waiting 30, 45, 60, 90 days and endless hours of A/R personnel time to collect. Large Ticket payments fit well with large inventory transfers, equipment and material purchases. The time value of money may reduce or eliminate the need for your Line of Credit or A/R Factoring.

 These rates apply to certain card types being mainly fleet, commercial and purchasing cards. Your account must be set up and underwritten correctly to be able to run Large Ticket transactions. In addition you must transmit additional data to get the transaction to qualify for these rate categories. That means that you need a system that is capable of transmitting that data correctly to get those rates.

 Sound dauntingly challenging? With the assistance of the right payment processing consultant and a processor that can handle the underwriting risk it is not a problem. Get a comparison of your processing and discuss what your payment goals are with your consultant. Then have them show you how their system handles the additional data transmission.

 Make sure to check our other Blog articles for other interesting topics.

Business to Business Payments

 What do you mean business cards get a lower rate? I always thought they were more expensive to take.

 That is because some business cards fall into “Special Industry Rates” interchange categories. Visa/Mastercard/Discover have these rates to promote card use in industries that they want to generate transactions in. Some of the industries include supermarkets, petroleum, warehouse stores, utilities and business to business.

 There are different types and levels of business cards. The cards that fit into the business to business categories are fleet cards, commercial, government and purchasing cards. Some of these categories have three levels of rates. To qualify for these lower rate levels additional data must be transmitted to get the transaction to qualify at that rate. That means you need a system that is capable of transmitting that data.

 Sound complicated and not worth the hassle? Think again my friend. There is over 1% difference between the rates in the different levels, even for card not present payments. That is a far bigger impact to the cost of your transactions than rate hopping to another processor will ever gain you.

 How do you get started qualifying at business to business? Talk to a knowledgeable, competent payment processing consultant. Have them evaluate how much business to business card transactions your company is accepting and have a comparison done. Then look at what system will transmit the required data.

 Make sure to check our other Blog articles for other interesting topics.

Free Credit Card Terminal?

The offer sounds too good to be true.  How can they do that?  Is it the best choice for you?  The answer is: It depends.

If you had a $1000 piece of equipment, would you give it out for free?  As a business you know that you would need to make something to cover the cost of that equipment.  The credit card processors are no different.  They are loaning a terminal to you for as long as you process with them.  In accepting a “Free Terminal” you are agreeing to pay a monthly minimum charge on your processing account so that they can recoup the cost of the equipment.  As an example, if your transaction fees are less than the monthly minimum fee (typically $25) they round your fees up to that amount.  Unless you do not run any transactions the additional charge is less than the monthly minimum charge.  If you run approximately $1500 in transactions each month you will never see this charge.  In this case your terminal is free.  If not you are getting a terminal for $25 or less each month.  Still a good deal.

The advantage to you is that you do not have to spend your money up front to buy a piece of equipment.  You also do not have to commit to a long term unbreakable lease that forces you to pay four times what the terminal is worth.  A sweet deal for you and the processor that earns your business.

Make sure to check out our other Blog articles for more interesting topics.

Without a Credit Card Terminal?

The all too familiar credit card terminal is not the only method of accepting transactions and often times not the best method either.  A terminal may not suit the way you do business.  With today’s technology there are multiple options to choose from that will do exactly what you need.

As an example, if you are a mobile services business, a terminal that is land line based is very difficult to work with.  You would have to bring all the information back to the office to manually key it in to the terminal, which is a slow process and has higher transaction rates.  One option is a wireless credit card terminal to swipe the card and get an authorization on the spot.  The only drawback is the expense of the equipment and additional fees for the wireless service.  The only way to justify the extra expenses is if you run a lot of transactions.

Another solution is running transactions on your laptop anywhere you get internet service. You can  even get a card reader with a USB connection to swipe the card and get the lower swiped rates.

There are also apps to run transactions from your cell phone manually and swiped.  The card readers work with most smart phones and make transactions quick and easy.  You can even send a receipt to the customer via e-mail.

Don’t have a smart phone?  No problem.  With most credit card processors you always have the ability to run a voice authorization over any phone to run a transaction.

If you accept transactions over the phone there are easier ways to enter them than punching them in on a terminal.  You can enter them online on a Virtual Terminal easier and faster.  Running a repeat transaction is a simple process of finding the first transaction so that you do not have to re-enter the information over again.  Transactions can be scheduled to happen one time in the future.  They can also be set up to happen automatically on a regular recurring schedule for rent, subscriptions or memberships.

As technology progresses the possibilities are expanding all the time.  Ask yourself what would make your life easier and get you paid sooner.  Chances are some of the solutions will save you money as well.

Make sure to check out our other Blog articles for more interesting topics.

Special Industry Rates

This article is about Special Rates for your credit card processing.  No, that is not the same as the Telemarketer telling you that magically you now qualify for wholesale pricing.  We are talking about the special industry rates that Visa, Mastercard and Discover offer.

As an incentive to get the card processing business more widely accepted in new business industries, V/MC/D offer special pricing for specific industry types.  Here is an incomplete list:

Supermarket

Restaurant

Small Ticket

Large Ticket

Gasoline

Convenience Store

Warehouse Club

Hotel

Car Rental

Lodging

Utilities: Electric, Gas, Water, Sewer

Trash Removal

Propane Delivery

Public Sector Entities

Government

Tax Payments

Real Estate

Insurance

Getting the industry specific rates is not automatic.  Even though your business may qualify for the special industry pricing you are stuck with a Retail type account and paying downgraded rates for transactions that are not “Qualified”.  It takes someone with knowledge about getting your business set up properly to take advantage of the special pricing.

Make sure to check out our other Blog articles for more interesting topics.

How do I become PCI Compliant?

What does PCI Compliance mean to you, the merchant?  It means that once again the merchant is expected to do the work and take the expense for new requirements.  Before you decide to close up shop and run away to Mexico for a margarita, there are solutions that make this process simple. 

Your credit card processor has been establishing a relationship with a third party service to help you maintain compliance and do the steps necessary for PCI security.  The fee for this service typically will run below one hundred fifty dollars per year for most Level 4 merchants depending on the complexity of your business. 

Your reaction to more work and expense to accept credit cards is understandable and I completely agree with you.  However, consider that fact that your customers want to buy from you, they want to use their credit card and they expect that convenience.  The cost for PCI Compliance and the credit card processing fees should be in the cost of your products and services just like materials, rent, payroll, utilities, fuel and taxes.  When your expenses go up you pass that on to your customers.  As a business you are in control of your bottom line, not a victim of your expenses controlling you. 

PCI Compliance is here to stay, so create a sense of security for your customers with your proactive efforts to protect them.  They will feel more comfortable buying more from you. 

For more information on becoming PCI Compliant contact your credit card processor to set up your compliance service. 

Check out our other Blog articles to answer other questions about payment processing you may have.

What do I have to do to become PCI Compliant?

Even if you know vaguely what PCI Compliance is, the “What” may still be a mystery.  There are four Validation Levels of businesses that each require different security measures.  Current Validation and Requirements are established for Visa/Mastercard in the following chart. 

  • Level 1 – Visa U.S.A. and MasterCard World Wide transactions totaling 6 million and up, per year, and any merchants who experienced a data breach. Requires an annual onsite review by merchant’s internal auditor or a Qualified Security Assessor (QSA) or Internal Audit if signed by Officer of the company, and a quarterly network security scan with an Approved Scanning Vendor (ASV).
  • Level 2 – Visa and MasterCard transactions totaling 1 million to 6 million per year.  Requires completion of PCI DSS Self Assessment Questionnaire annually, and quarterly network security scan with an approved ASV.
  • Level 3 – Visa and MasterCard e-commerce transactions totaling 20,000 to 1 million per year.  Requires Completion of PCI DSS Self Assessment Questionnaire annually, and quarterly network security scan with an approved ASV.
  • Level 4 – Visa and MasterCard e-commerce transactions totaling up to 20,000 per year and all other merchants, regardless of acceptance channel, processing up to 1 million Visa or MasterCard transactions per year.  Requires completion of PCI DSS Self Assessment Questionnaire annually, and quarterly network security scan with an approved ASV.  If a breach has been reported, or found, Visa reserves the right to move the Level 4 merchant to a Level 1. If so, the Level 4 merchant must abide by the Level 1 validation requirements.

The vast majority of merchants will fall into Level 4 but that does not mean you can sit on your laurels until something happens.  Obviously the first focus in the industry is going to be on Levels 1, 2 and 3.  You definitely do not want to slip into Level 1 because of a breach.  That is why it is important to work on your security early to avoid fines for non-compliance.  Customers will soon demand the security before they buy from you.  Use the early compliance as a marketing tool and advertise it.

For more information go to: https://www.pcisecuritystandards.org/index.shtml

Be sure to read our other Blog articles on PCI Compliance.

What in the Heck is PCI Compliance?

PCI DSS stands for Payment Card Industry Data Security Standard.  It is an abbreviation that stands for a scary sounding unknown.  PCI DSS is a standard created by the credit card processors in reaction to many state laws and impending federal laws that govern the protection of consumers’ data.  This is similar to the HIPPA regulations for the medical industry except it is self imposed.  It is better to be proactive than to let the government come up with regulations.  After all, the government came up with the IRS and we all know what a nightmare mess that is.

So you are saying to yourself “Yeah, so what”.  All merchants are required to be compliant by July 1, 2010.  There could be fines of $5,000 to $100,000 per month for non-compliance and/or increased processing fees or account termination.

American Express, Discover Financial Services, JCB International, Master card and Visa Inc. all require PCI Compliance.  The concept is to create secure systems in your business.  By establishing the following procedures it will keep customers more secure about spending more money with you.

Build and maintain a secure network

  • Maintain a firewall to protect cardholder data.
  • Do not use vendor defaults for system passwords and security parameters

Protect cardholder data

  • Protect stored cardholder data.
  • Encrypt transmissions of cardholder data over open public networks.

Maintain a vulnerability management program

  • Use and regularly update anti-virus software.
  • Develop and maintain secure systems and applications.

Implement strong access control measures

  • Restrict access to cardholder data on a business need to know basis.
  • Assign a unique ID to each person with computer access.
  • Restrict physical access to cardholder data.

Regularly monitor and test networks

  • Track and monitor all access to network resources cardholder data.
  • Regularly test security systems and processes.

Maintain and information security policy

  • Maintain a policy that addresses information security.

For more information go to: https://www.pcisecuritystandards.org/index.shtml

Be sure to read our follow up Blog articles on PCI Compliance.

Welcome to SGP Services

At SGP Services, we focus on understanding your business and providing the best processing package for the type of transactions your business encounters most.

Any processor can take your transactions. Your business is unique and should not be treated as a round peg in a square hole. Tailoring your processing to your business is our unique difference. We’re here to help you, even after the account is approved and your business is accepting credit cards.

The providers we represent offer:

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