By Dee and Emily Karawadra
This is the first article in a two-part series by Emily and Dee Karawadra on what merchant level salespeople (MLSs) – also referred to as agents – can expect from their processors or ISOs. In this installment, Emily shares her views. Dee will convey his thoughts in issue 19:07:02, which will be published July 22, 2019.
MLSs should spend most of their time in the field prospecting, closing deals and building relationships. This isn't the case for many agents. They spend significant time and effort managing the processors or ISOs to whom they board business. From start to finish and at all stages of boarding a merchant account, it's imperative for the MLS to be informed. This allows them to properly prepare merchants for the set-up process.
When deciding where to place a merchant account, an MLS can go directly to a processor or go to an ISO. Each alternative has its strong points. If you are a big sales office and have staff to manage the boarding process, merchant deployment or terminal setup, working directly with a large processor may suit your needs.
If you're a sole proprietor MLS or have a small office, going with an ISO may fit your needs best. ISOs often have the systems of the processors they board with in-house and may also have access to more than one processor. The ability to board with multiple processors can be a critical factor when trying to board a merchant whose business needs require access to a specific platform. This is when ISOs become a better choice.
Most reputable ISOs have strong support staffs that walk MLSs through boarding a new account from start to finish. This is what an ISO's main function is, as the ISO is not responsible for moving transactions or billing merchants. Unless the business is a wholesale ISO (an ISO that does its own risk and underwriting) the ISO outsources all of that to the processor. The ISO's sole focus is on service and support, so if you're with an ISO, you can demand service. If you're not getting specialized service from your ISO, plenty of other ISOs can provide it.
If you are an MLSs new to the industry, have worked in payments from a support role, and/or have taken steps to become an ISO, the questions and points below will help you secure the right partner. Keep these in mind during negotiations with a new partner.
If e-signature is an option, what are the requirements and does it work 100 percent of the time?
From a production standpoint, do you have monthly or yearly numbers to hit? If you don't meet those, how will that affect your book of business, buy-rate and/or split? Some processors and ISOs will then revert you to a different buy-rate and/or split, which can significantly affect your bottom line.
In the next issue, Dee will take you through negotiating your contract and schedule A with your ISO or processor. In addition to knowing what you want from a support standpoint, the ability to negotiate a contract that works for your business will make a world of difference. No one likes surprises. Getting a notice from your processor that you haven't met your minimums or that you haven't fulfilled your end of the bargain can be very frustrating. And that notice usually comes along with bad news that you no longer qualify for the great buy-rate and split you signed for.
All of this can be avoided by knowing what to look for in your contract and making sure you can meet the processor/ISO's expectations. Something as easy as asking for a ramp up period of 12 to 24 months to get to the volume expected from you can significantly aid you in m
Dee Karawadra is president and CEO of Impact PaySystem, and Emily Karawadra is the company's chief financial officer. Since 2001, Impact PaySystem has been a leading provider of payment processing technologies and services to merchants throughout the United States. Through alliances with payments industry leaders such as Chase Paymentech, First Data, Buypass, Sage and more, Impact PaySystem offers tailored solutions to meet the unique needs of each merchant. Dee and Emily will welcome your questions and comments at firstname.lastname@example.org and email@example.com, respectively.
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