US Bankcard Services Industry Blog

Friday, November 9, 2012

USBSI Condolences to Victims of Hurricane Sandy

Share


USBSI would like to extend its condolences to the victims of Hurricane Sandy on the North Eastern coast of the United States. As those in the affected areas work towards the restoration of their homes, towns and businesses, there are still many areas that need improvement. And USBSI is eager to help.
There are two ways that USBSI will offer assistance. First, for each donation to the American Red Cross a USBSI employee makes, USBSI will match the donation. The American Red Cross is helping with everything from power outage assistance, to volunteer cleanup to accepting donations across the globe to help fund efforts. USBSI is happy to match all employee donations made to the American Red Cross in an effort to provide aid to the victims.
The second effort is, USBSI will reach out to all affected merchants and offer free replacement terminals for any merchant who is unable to use their machine. USBSI knows that small business is the life force of all major cities. With New York being the largest US city, USBSI knows how important it is to get business back on their feet.
Everyone in the country is affected by Hurricane Sandy in some way, but none as great as those in the North Eastern coast of the United States. USBSI is an intranational company and will offer all the assistance it is able for cleanup efforts and to restore those in need in the USBSI family. 

Wednesday, November 9, 2011

Merchant in America: Series Episode 4: The biz payment set up: Bank vs. MSP

Share

Yikes, I now realize that being a merchant is a lot of work. So I just finished with the General Contractor (GC) and Interior Designer with Feng Shui experience…good grief there is a lot to do…but I must say the GC and Designer are transforming a simple, dusty space into a magical and inviting store location. Now it is late, I am hungry so I am going home to relax for a little bit and then look at MSPs…I still have the advertisement for US Bankcard Services, Inc. (USBSI)…U-S-B-S-I…yeah that has a nice ring to it…it stands out. Still, why does my bank keep asking me about whether I want merchant service account?…Ahhh, the bank…setting up a corporate banking account, wow that’s not easy…and that’s a story for another day. So I am going back and forth in my mind…MSP or Bank…really what are the pros and cons? Well, I compared the banks rate for processing and it seems slightly lower than the average MSP, but the Banks do seem to have a lot of extra fees and charges…plus the Customer and Technical Support hours are very limited…my restaurant starts early and finishes late so limited or extra cost support is no good. So let’s look at what separates an MSP like USBSI from the banks and other MSPs…

OK… relax time is over now, and I am looking at USBSI’s advertisement which reads:

Value Added Service Do you want to SAVE Money? LOW Rates Starting at 1.29% Come Join the US Bankcard Services, Inc. Family! No Startup Cost No Application Fee No Programming Fee FREE CREDIT CARD MACHINE 24/7 Multilingual Support Next-day funding Chargeback assistance Next day Approval Innovative Solution Cutting Edge Technology To Contact SALES: edm@usbsi.com or 888.388.2128

Wonderful!…this is everything I am looking for….these are the ‘value adds’ that my Economics Professor spoke of. Better rates than the banks I went to plus look at all the additional value added services. It is worth it for me to go through USBSI for merchant card processing. They also have all major and niche card brands like They also have all major and niche card brands like:

So here is what I need to get a Merchant Identification Number (MID):

Application Requirements for all businesses:

  1. Physical Location in the US
  2. Checking account with a bank located in American in the name of the business or the merchant account signer
  3. Explanation of business type (i.e.: LLC, Corporation, Sole Proprietorship, etc.)
  4. Federal Tax ID Number (EIN)
  5. Owner or Merchant Account signers SSN
  6. Owner or Merchant Account signer’s address information
  7. Product or Services being sold information
  8. Intended method of accepting transactions (i.e.: swipe, internet, keyed, etc.)
  9. General business location type (i.e.: Shopping Center, Home Based, etc.)
  10. Copy of a voided check from merchants’ checking account

Additional Requirements for some businesses:

  1. Exchange and Refund policies
  2. Marketing material (i.e.: business card, brochure, advertisement, etc.)
  3. Proof of State or Federal Business License
  4. Proof of business existence (i.e.: phone bill, utility bill, etc.)
  5. Proof or financial stability (i.e.: profit and loss statements, bank statements, etc.)

Requirements for all internet businesses:

  1. Active website with DBA of website listed on application
  2. Product delivery methods and time-frame clearly stated on website
  3. Product prices in US dollars
  4. Privacy Policy listed on website
  5. Customer Service telephone number listed
  6. Secure checkout system
  7. Domain name registered to merchant

Goodness gracious…this seems like al of effort. I am so glad USBSI could help me out…especially with overcoming the language barrier and my ignorance of American Law and business practice. Well I will call USBSI tomorrow and inquire about desk-top and mobile terminals… Oh yeah…and e-commerce set-ups…now it’s time for bed. Good night.

Previous Episodes:

For innovation in the card industry or to find out more about your industry and our service, please call us at 888-525-8558 or on the web visit US Bankcard Services, Inc. or drop us and e-mail and follow us on Facebook.

Tuesday, October 25, 2011

Smart Credit Cards: Science Fact or Sicence Fiction?

Share

What is all the commotion about? There is another new kid on th processing block….may I present Dynamics. They have raised $35 million in funding to accelerate its business of making computerized smartcards and payment systems for the card processing industry. In the U.S., most credit cards use magnetic stripes that are read by 1970s-era card readers. Dynamics uses those same magnetic-stripe readers, but it has features built into the plastic of its Card 2.0 credit cards that enable more innovative features without requiring a multibillion-dollar upgrade in the payments infrastructure.

Above: Dynamics Multi-account Card

Dynamics is transporting old-fashioned magnetic strip credit cards into the modern computer age. For instance, as you can see in the top image, at a merchant location the cardholder can press a button on the card in order to switch it from a credit card to a debit card or vice versa. This “multi-account” card can rewrite the numbers on the magnetic stripe as needed. That allows credit card issuers — who spend $20 billion a year on marketing — to truly differentiate themselves from the rest of the pack according to Jeff Mullen founder of Dynamics.

Citibank is its first major customer to other credit card issuers. And is also preparing to expand beyond local territories, but it is also working to expand into new markets around the world, including the contact-chip card market in Europe, the radio frequency identification (RFID) card market in Asia, and the phone-based payment systems that are beginning to launch with smartphones…maybe even Google’s digital wallet. Dynamics I being innovative in payments and be agnostic about the platforms. Dynamics has made the 40-year business model cycles at card issuers are turning into 3-year business model cycles.

Dynamics hopes to upgrade magnetic stripe cards to computerized smartcards with better fraud security and multiple accounts per card — without making any changes to the existing infrastructure of magnetic stripe readers in 60 million locations. The ultimate goal isn’t just to upgrade credit-card technology. It’s to transform the existing credit-card business, with cookie-cutter cards and offers, into ones where consumers can give voice to their needs and banks can respond with personally customized offers.

The development could be very significant for credit-card issuing banks that have wanted to upgrade their service to engage and reward customers, only to be stymied by the limitations of magnetic-stripe cards. Every bank aims to be “top of wallet,” which is the card that a person will use for 70 percent or more of their transactions. The second card down will likely be used only 15 percent of the time, and the third card, 5 percent. If a bank can offer better rewards, make a card more secure, or otherwise convince someone to use a card more often, the financial gains can be enormous over the life of the customer relationship and this segues into the merchants pocket…less fraud means less money loss.

Each ultra-thin card has 70 electronic components and can be modified on the fly. That means the company can change the numbers that are fed to the magnetic-stripe reader. For instance, if you press a button on one of Dynamic’s cards, it will switch from one credit card number to a different one (and change the indicator light so you know which account is active). You can thus have multiple credit-card accounts from one bank, such as a personal account and a business account. The purchase is processed on Visa, MasterCard, or other card networks as a card transaction. Another type of card can offer improved security. Instead of a full 16-digit credit-card number, the numbers are interrupted by a display. The display will show the remaining numbers in the account only after the user types in a PIN code on a set of five small buttons on the surface of the card. If a card is lost, a thief can’t use it at all unless he or she knows the PIN code. If the result is fewer fraudulent transactions, then the banks can see improved profits. A programmable card fits with the strategies of a lot of banks, which are issuing different cards for loyalty programs or budget management. Wow!… NFC, RFID, EMV…science, technology and card payments are coming together en force.

For innovation in the card industry or to find out more about your industry and our service, please call us at 888-525-8558 or on the web visit US Bankcard Services, Inc. or drop us and e-mail and follow us on Facebook.

Monday, October 10, 2011

Stimulus Buster: Merchant Cost Cutting

Share

Stimulus… what stimulus?… Okay we all know these are financially trying and emotionally charged times. But what could we do to quell the savage beasts?… Well as merchants we some great options. Prevention being one important way to prevent operating costs to hemorrhage. Aside from precautions like PCI, good security practices and common sense, it's always good to be cautious with the way you handle your business transactions. As a merchant who is using credit card processing there are some very fundamental ways you could save some cash. Here are some ways on how to manage your processing costs:

  1. Physically Swipe Customer Cards whenever possible: Entering in card numbers using a keypad is a common reason for higher transaction rates. It has a higher risk of error and fraud. For more fraud information please read fraud in the catering industry. Please watch our educational videos for more protection against money loss.
  2. Accept PIN debit cards: There has been a continuous expansion in the usage of debit cards. Depending on your rates, generally speaking, the rate for a debit card transaction can be lower than some of the other processing rates. By accepting debit cards, you can lower your processing cost.
  3. Review your processing procedures (Card Not present): There are times when you need to process transactions without the card present. The terminal being used to process transactions may ask for certain criteria in order to complete the transaction without carrying a higher rate. Follow the steps carefully.
  4. Use the Address Verification Service (AVS) correctly: Generally speaking AVS occurs when the card is not present, and transactions are keyed in. Be sure to input the required field correctly to avoid higher rates. If the AVS does not check out, you should call the card authority/financial institution and notify them there is a 'Code 10'… something suspicious about the card or cardholder.
  5. Send settlements on time: Settle your transactions every day after closing to avoid higher rates. The longer you prolong your settlements, the higher your rates.
  6. Obtain authorization/settlement mismatch exemptions: Be sure to check that your merchant category code is suitable to the nature of your business and payment structure. If your authorization amount and settlement amounts do not match, be sure to expect payment downgrades.
  7. Chargeback prevention: Be sure to check all card aspects like matching name to ID, ensuring card expiration dates, embossing, and holographic logos… And remember to publish and practice return policies… Don't forget about AVS, be careful of non-US purchases… AVS only works in the USA. For more information on how to save money go to our educational videos page.

Our well-versed Customer Service and Sales staff can help you preventing money loss while showing you some easy ways to be a more security-conscious merchant. To find out more about your industry and our service, please call us at 888-525-8558 or on the web visit US Bankcard Services, Inc. or drop us and e-mail and follow us on Facebook (Log-in & search 'US Bankcard Services, Inc.').

Monday, September 26, 2011

PCI: The Need is Now!

Share

Attention! All merchants who use credit card processing: As the economy continues on its precarious path there seem to be no improvements in banking fraud protection for SMBs… uh oh… now what? Guardian Analytics and Ponemon Institute have been researching, monitoring and providing industry fraud data reports for years.

It seems that businesses and financial institutions continue to lose money and customers due to a lack of action being taken to prevent corporate account takeover and fraud such as skimming. According to a new study from fraud prevention firm Guardian Analytics and the Ponemon Institute there has been no improvement in the banking industry's ability to stop the unlawful siphoning of money from SMBs with compromised accounts. In the last year, 56% of SMBs reported experiencing payments fraud, or attempted payments fraud, while around 75% reported experiencing account takeover and fraud via online banking channels. Those levels show no improvement on 2010's rates. The study also found that 78% of bank scams involving SMB accounts weren't discovered until after funds were transferred outside of the institution. Furthermore, 70% of SMBs believe it is their bank who is ultimately responsible for the security of their money… but really the merchant in the end is responsible for security.

The result?… A high churn rate… Many businesses choose to move their banking activities after experiencing fraud with about 10% terminating the relationship and 33% who move their primary banking activities. It's a lose-lose situation for banks and businesses - only the criminals are winning. And as online and mobile banking continues to grow, the possibility for more fraud and more lost customers escalates. Endpoint security will be challenged to keep up with the growing number of devices and threats, and banks are in the best position to take the lead on proactively protecting all account holders from the wide variety of threats. This research also reveals SMBs aren't sitting on their laurels when it comes to protecting themselves.

Over three-quarters conduct a monthly account reconciliation exercise, a quarter have a dedicated computer for online banking, 49% use dual controls, 21% use positive pay and 55% of businesses practice daily reviews and approvals of outgoing transactions. A small number (16%) educate their staff in fraud prevention methods. To begin security and fraud prevention practices start with healthy PCI practices.

The above outlines that need for PCI compliance and formalized business and security practices for all merchants especially SMBs who are at higher risk due to lack of proper security measures. At USBSI we have got this down to a science. All of which are part of our business practice and security measures. Please let us share these with you. You work hard for your money; don’t let lax security and criminals take your hard-earned money from you. The below are just some of the security blogs we have published with our merchants’ welfare in mind.

How to minimize fraudulent transactions?
Preventing Hacking, Hijacking, Phishing, SPAM and Fraud: Part 1 - The Basic Practices
Preventing Hacking, Hijacking, Phishing, SPAM and Fraud: 5 safety tips for using a public computer (Part 2 of 4)
A Merchants Guide: Preventing Hacking, Hijacking, Phishing, SPAM and Fraud: Part 3 of 4
Preventing Hacking, Hijacking, Phishing, SPAM and Fraud: Part 4 of 4 : Visa & MC: Rules for Credit Card Transacting

To find out more about your industry and our service, please call us at 888-525-8558 or on the web visit US Bankcard Services, Inc. or drop us and e-mail and follow us on Facebook (Log-in & search ‘US Bankcard Services, Inc.’).

Tuesday, September 6, 2011

Merchant in America: The Series Episode 3: Rental Checklist

Share

Alright…I finally found the perfect space for my SMB (Small to Mid-Sized Business). My rental agent told me there are three things that are important for commercial real estate: Location, Location and Location. She explained that storefronts must have good ‘traffic’ meaning, there needs to be a lot of people physically coming near the store and the store needs to have easy access for customers, their vehicles and vendor deliveries. Then she also told me that the at the most important thing about the interior space of a commercial property is: Design, Design, Design. She went on to explain that you must make the interior functional, attractive, clean and if you can …unique. And before I left her office she gave me a ‘walk-through checklist’. She said that I could use this list to make sure everything is acceptable before I sign the lease or make my first rental payment…boy, she was really helpful.

And she also told me some basic things to consider as a new renter and new business owner:

  1. Do you have the rental agent, landlord contact information and rental payment information?
  2. Do you have your signed copy and a signed file copy of the rental agreement (lease)
  3. Is your Insurance (Renter’s, Business, Inventory, etc.) purchased and ready to go?
  4. Are the utilities functioning properly?
  5. Are all your business accounts set up and Federal Identification Number (also call tax i. d. or EIN) retrieved, including your Bank(s) and other vendors.
  6. Are all service providers’ contact and account information written down or saved on your PC for easy access?
  7. Does anything need to be negotiated (like work needing to be done)? Is the negotiation acceptable?
  8. If you do any interior construction, make sure that you are not responsible for de-construction/demolition costs.
  9. Could any portion of the lease be prorated if I cannot move in to the space on the move-in date?
  10. Do you have any disaster emergency plan aka Business Continuity and Business Resumption
  11. Do you have all keys and needed copies to Property?
  12. And do I have what’s needed for my MSP (Merchant Services Provider) so that I could begin your credit card processing:

Proof of Existence – Make sure to include a business license, a seller’s permit and/or a utility bill. All of these items are another step closer to proving to the processors that your business is legitimate.

Proof of Residence Existence – A driver’s license and/or most recent previous home address goes a long way towards showing the processor that just because the merchant recently moved, doesn’t mean they present any risk.

Processing History – OK If this is your first business you will not have this, but if you have a business and wish to make a change your previous processing statements greatly influence the time it takes for Underwriting to review an account.

PCI Compliance – A handy dandy reference sheet to ensure that you are compliant with the PCI-DSS

Although listed separately, it’s a good idea to get as much as the above documentation as possible. It is better to be proactive instead of reactive.

Well I have a lot to do…so I better get cracking…. WOW...I must admit this is a great rental space for my business. Just now she sent me a text message with a cool and convenient smart phone app link. The app is: Commercial property inspection; Rental property and apartment building move-in, move-out checklists; Residential property surveys and inspection reports…She is thorough…I will do my best to satisfy my customers, too.

Previous Episodes:

To find out more about your industry and our service, please call us at 888-525-8558 or on the web visit US Bankcard Services, Inc. or drop us and e-mail and follow us on Facebook (Log-in and search ‘US Bankcard Services, Inc.’).

Monday, August 29, 2011

Merchant in America: Series Episode 2: Long good-byes and short good buys

Share

It was a bitter-sweet sorrow to leave my homeland, but the “American Dream” will be mine. Well, I have arrived in the US of A and started looking for rental space. I was just thinking of how will I start my business exactly and on the train ride to the apartment rentals office, I saw a US Bankcard Services, Inc. advertisement in the World Journal. So I started reading….

Credit Card Processing

What do I need for a merchant’s credit card processing?

First I will need to establish a merchant account with a merchant services provider (MSP). This account is used for the settlement of credit card transactions processed by my business.

And the funds derived from the merchant account will need to be deposited into a checking account belonging to any bank of my choice.

In order to establish my merchant account I might need to obtain the following information:

  • A business checking account or a personal account if I am a sole proprietorship
  • A copy of a voided business check
  • Articles of incorporation, business license or reseller license
  • A web site (if you are Internet based) or a retail storefront
  • Provide 2 trade references
  • A photocopy of my driver's license or other accepted form of ID
  • I can then submit the application to an MSP like US Bankcard Services, Inc.

But I am wondering what charges are assessed to a merchant by accepting Credit Cards?:

There are many fees to consider based on the type of business and volume of business I do. Many of the fees associated with credit cards are fairly standard in every business. Here is a small sample of the type of charges that I may encounter:

Discount Rate:

The amount charged to a merchant for processing daily credit card transactions.

Transaction Fee

A fee charged by an MSP for each credit card transaction completed.

Chargeback Fee:

A credit card transaction that is billed back to the merchant after the sale has been settled. Chargebacks are initiated by the card issuer on behalf of the cardholder. Typical cardholder disputes involve product delivery failure or product/service dissatisfaction. Cardholders are urged to try to obtain satisfaction from the merchant before disputing the bill with the credit card issuer.

Non-Qualified Surcharge:

This surcharge applies to business and corporate cards as well as other downgrades, such as manual entry sales that do not pass Address Verification. A merchant's failure to batch out their point-of-sale device within the allotted

24-hour period can also cause additional processing fees to be assessed. When accepting credit cards, it is important to understand this fee. Please contact a USBSI sales support representative for more information.

Voice Authorization Fee:

This fee is charged only if a merchant calls in a credit card sale using our voice automated system. For instance, a merchant needs to accept credit cards off-site and does not have access to their point-of-sale device. The merchant can then call our 800 number to process the credit card transaction…and there could be more depending on a number of other variables.

And of course I will need terminals to process purchases at my business…:

There are various types of terminals for a multitude of merchant environments and needs. There are fixed terminals sometimes called desktop, there is POS software used on PCs and there are mobile terminals, which can be part of a smart phone as an attached device or a wireless terminal unto itself. There are some good terminal explanations.

….Wow there is so much to think about. I hope I have not missed anything…Ah, I have finally arrived at the apartment rental office. I will ask them about commercial rental space for my restaurant, too….If the commercial rental cost is too high, I may consider starting an e-Comm restaurant supply business instead and see what happens from there. OK then…more credit card processing decision-making later…

Previous Episodes:

Merchant in America: Series Episode 1: From the Homeland to the New Land - USBSI Blog

To find out more about your industry and our service, please call us at 888-525-8558 or on the web visit US Bankcard Services, Inc. or drop us and e-mail and follow us on Facebook (Log-in & search “US Bankcard Services, Inc.’).