MSI, founded over twenty (20) years ago, consistently responds to the requirements of the market. MSI recognizes in this challenging economic atmosphere immediate funding is often necessary to the very viability of a business. Merchants will benefit substantially from increased cash flow and from accelerated account reconciliations.
MSI is extremely excited to offer the flexibility merchant needs with next day funding.
Read more: http://www.msihq.com/news/NDF_2011.html

There have been a lot of questions circulating about EMV meaning chip-and-pin. However, this is not true. The USA has real-time processing that enables instant approval. With this, there is no need for the additional authentication.

They say, the key is to implement a streamlined, online-only version of EMV chip. At the time EMV was created, the cost and complexity of connecting a merchant POS device to some telecommunication networks was prohibitive. The way around that was to introduce ìfloor limitsî and create a magnetic stripe alternative EMV chip-and-PIN as a counter to potential fraud.î
Now, most of the world uses online verification. Only a very small percentage use offline authorization. The EMV chip in addition to online verification will increase security greatly, and we hope that merchants make intellectual decisions when determining what is best for their business when it comes to payment processing and security.

How do the swipe fees work on credit cards?

Are you aware of the term swipe fees that are charged every time you swipe your debit or credit card while making a purchase? The fees that the banks charge one another to handle the electronic payments are called the swipe fees. With the example mentioned above the $2 that is going to the bank is known as the swipe fee. The biggest share of money that is held back in this case is $1.60 and this covers things like nonpayment and other reward programs and all the other marketing efforts that are employed to promote the card.

Knowing the web of fees that’s woven around every single transaction

If you’re a credit card user, it’s pretty clear to you that there is a web of fees that’s woven around every single transaction that’s involved with your credit and debit card. The annual fees that you have to pay if you have a premium card and the interest rate that you’re charged when you pay off your credit card balance in full are the most important kind of fee that you need to check before taking out a credit card. This fee usually goes to the company that issued your card. On the other hand, the merchants are complaining bitterly about the merchant discount rate and the interchange fees that the customers don’t see at all. This is the fee that the merchants have to pay to the company that processes your payment when you buy something with your debit card. Usually the merchants pay 2-4% of the sales price in various transaction fees each time they accept a credit card payment.

Can you pass on the credit card processing fees to customers?

As the merchant fees for the credit card accounts gets more expensive, the burning question in regards to a merchant account is whether or not it is possible to pass on the merchant account fees to the customers. The answer is yes as it is certainly possible to charge a customer with some fees when he decides to pay with a credit or a debit card. However, the issue is a bit complex. The possibility of accepting credit cards comes with many benefits for the merchants but the cost is the only negative factor behind it. Though the merchant company will charge a fee from the customer, this may often become risky as the fee will make them buy less with their credit cards and this may cause the credit card originators to lose money.

Therefore, if you’re a merchant company or a retailer, you should stay aware of the various fees that you’re supposed to pay to the credit card companies. Ignorance may lead to debt and you may have to rush to the debt relief companies for help. To know more on debt, you may visit http://twitter.com/#!/debtcc.

This created a lot of news in the market as members of electronic payments community we upset with the kind of news coming in. Soon after that many blogs came up on the web that condemned VeriFone of trying to take over Square and that they purposely try to hack the card reader to ruin the reputation of Square Inc. However, soon after that one more person tried to successfully hack the Square card reader who was certainly not working for VeriFone. Square on the other end decided to reply to the video that was posted by VeriFone and said that hacking is something that has become common today, but Square makes use of secure server which prevents information leaking.

However, it is strange that soon after that Visa tried and invested around $100 million in Square Inc and said that soon Square Inc will follow the guidelines provided by Visa and that they are happy that Square Inc is working hard to follow the guidelines set by Visa. In May 2011, Electronic Transactions Association and Steve Wozniak said that they love the simplicity of the Square card reader but he never really talked about the security concerns that surround the card reader.

Square has already created new level of merchants and they are already in huge numbers because they can buy Square card readers from various different stores now. These merchants want free and simple ways to get discounts for the items that they sell and they don’t look at the security factor that consumers have to go through. With the help of Square card readers merchants don’t have to buy any equipments and get it on lease or rent. Square Inc has already forgotten about their security concerns because they recently claimed that all their servers are secured and therefore they don’t need to make any changes to their card readers. Although, Square has opened the floodgates of new merchants only time will tell if this cheap model will sustain in the market or will lead to some kind of revolution.

He said that Operation Swiper has five credit card forgery and identity theft rings operating in the United States, Middle East, Europe, Asia, and Africa to make it more convenient for the law enforcement authorities to get the culprits. Brown also said that this is by far the largest and certainly the most sophisticated operation that law enforcement has ever come across. He also shared the information that all the thieves in the indictment stole the credit card information by some ways like direct theft, or stealing the information of the credit card or purchasing stolen cards from underground websites. The stolen card information was then sent to a factory where new cards are made using the information they have. Once the card is ready using the genuine stolen information it is divided in gangs across the United States that start buying high end electronics and clothes and other popular items that are in demand. These items are then sold at discounted price to shady retailers.

However, some people believe that arresting these people won’t help much because there are hundred different gangs operating in the United States and around the world. However, Randy Vanderhoof, Executive Director of the Smart Card Alliance said that the law enforcement has done extraordinary job but there are hundred such cases pending and law enforcement need better technology rather than using limited resources. He also targeted the magnetic stripe technology saying that magnetic stripe is the easiest point of attack by these thieves and therefore something must be done about it because all the information is available on the magnetic stripe which is then used by these scammers.

Mark Bower, Vice President of Voltage Security Inc also applauded the news saying that such news must be highlighted because it shows that law enforcement is doing fine job by arresting these people who tried to steal information into cash. He also said that better ecosystem has to be developed and that merchants and consumers should have better transparency and security. He said that if the system is not protected then hackers will definitely make use of it because they don’t need to rob a bank with a gun these days.

The new Visa basic rates have gone up from 0.95% plus 20 cents to 1.15% plus 15 cents. Hence, when consumers make purchase of $38 it will cost merchants 59 cents more in their interchange rates while earlier they would only pay 56 cents as interchange rates. This means that merchants will now pay 5% more than the earlier interchange rates. There are 19 categories where Visa card will have to make modifications and petroleum category has the biggest Visa hit rate. All the merchants will now be paying 73 cents more on $50 purchase while earlier they would only pay 55 cents. The new interchange rates for all prepaid transactions at gas stations have increased by 29% and similar changes have been seen in various other categories like ecommerce, travel and entertainment categories. However, the interchange rates for utilities and tax payments have gone down for all debit and credit cards.

All small transactions interchange rates will go from 1.55% and 4 cents to 1.6% and 5 cents. This means that when you take a fast food ticket using your Visa and MasterCard then merchants will have to pay 9% extra on that transaction. There are some other changes that are being made with the introduction of new interchange rates. Now Visa Regulated Check Card Interchange also applies to card present and card not present transactions in all industry categories. The card brand consolidated its Debit Credit voucher interchange programs. As per the new rules Visa will no longer offer retail and supermarket debit performance thresholds. On the other hand it will also lower retails and supermarket credit interchange rates. Visa will also be offering six new domestic interchange programs under new Visa Business Enhanced Card Fee Program. There will be new interchange program and rates for charity merchants which only applies to customer credit transactions, not debit. From October 15, 2011 all groceries, supermarkets, convenience stores, service stations and shops will have access to Visa CPS/ Small ticket interchange.

There are mixed reactions from the industry because some people claim that new interchange rates will have no effect on this business while there are some experts who think that change in interchange rates will definitely profit the merchants as they will be gaining better business.

The company also voiced out their opinion stating that Quick Service Restaurants are now paying more for their services and with the changes in interchange rates they will now have to pay 2.15% compare to 2.08% in September 2011. They claim that since the Visa and MasterCard have changed their interchange rates they have eliminated the small ticket interchange rates that QSRs were enjoying before the Durbin Amendment. They also stated that it was only because of Durbin Amendment that these changes came into existence and that is impacting their business big time. Heartland Payment Systems Inc also said that there are more upscale restaurants who are Heartland’s clients and the company reported that in just two days they had passed $671,652 in debit interchange rates. They also revealed that after the reductions they had passed almost $1.78 million in debit interchange rates which is definitely more than what they had expected.

Heartland’s President, Bob Baldwin said that these savings are just tip of the iceberg and that they expect merchants to save more than $1,000 in debit interchange in the next few months. Following this statistics by Heartland, Durbin Amendment directed Federal Reserve Board to study and come up with a cap for the interchange assessment card acquirers collect from merchants. Initially, the Federal Reserve Board had set up a cap of 21 cents plus 0.05% of the transaction plus an additional penny for security requirements. This totaled up to be 40% discount on the going rate for debit interchange in 2010.

Heartland said that the interchange plus pricing scheme is only helping merchants to save more on interchange rates but Durbin dollars should stay in merchant’s bank account and merchants should not take this for granted. Heartland also came up with other important statistics that Durbin Amendment is looking into. As per Heartland Payment Systems 65% of the debit card sales volume was subjected to mandated cap. The average fee paid for regulated signature debit is 23 cents and for unregulated signature debit it is 44 cents. The company also claimed that the effective interchange rate for payments made using regulated signature debit cards was 0.80% and using unregulated signature debit cards is 1.55 percent.

It was revealed that people who were involved in such crime would always shop Apple products that were more popular in overseas market. Police have seized Apple devices that were worth in millions during their raids in New York City this October. On the other hand, they also raided items like computer equipments, designer shoes, electronics, watches and other items worth millions of dollars. Card skimming is not a new issue but it is becoming more prevalent in last few years in the United States. Crime gangs are more technically informed and therefore they know how to hack the system and breach the processing system. Card skimming is one major problem that is troubling financial companies and payment industry in the United States because consumers are getting affected by it. The most common places where your card can get skimmed are at unattended gas stations and ATMs.

Merchants are the first line of defense for POS fraud and therefore merchants need to make sure that their card database and terminals are safe from hackers. This is why they need to focus on physical location and security controls and look for staff that they can rely on. There are several PCI DSS guidelines available that needs to be followed like placing surveillance cameras around the area of POS or PED device, but the problem is that not all merchants are ready to spend that much on security or getting sophisticated technology which  makes them vulnerable to such fraud activities.

The PCI standards for card security has been placed for last six years but still card skimming remains one of the most threatening issues for payment industry because not all organizations comply to the rules and guidelines set by PCI. As per the reports by Verizon only 21% of the companies follow the guidelines that are provided by PCI DSS. Most of the time merchants are worried about interchange rates but they are never bothered about identity theft frauds that have cost more than $100 billion in 2010.

Google Wallet is a new product launched by Google in partnership with Citibank, MasterCard Worldwide and First Data Corp and Sprint. George Zirkel, Vice President Mobile Solutions for First Data said that as one of the partners for Google Wallet they are going to make sure that their customers get better opportunities through Google Wallet. To make it even better and convenient for the customers, $10 is loaded on the virtual prepaid card soon after the users download Google Wallet on their smartphones. Zirkel also said that First Data will deliver Google’s virtual accounts to the handsets used by consumers and that they have tried to incorporate better infrastructure with Google to make it more unique for the consumers. He added that First Data will also provide Money Network account along with other technologies so that consumers can see all their transactions and reload their account. Hence, First Data will be responsible for all authorization traffic and will act as program manager for Google prepaid account.

Revealing more about the program, Zirkel said that Google Wallet will require consumers to use PIN code that they will need to access their accounts that are inside the handset. First Data is also working with Google to provide merchant specific cards. These close loop cards will be issued by popular retailers and therefore consumers have the option of open loop card and closed loop card depending on whatever they feel convenient. Speaking more about the usability Zirkel explained that when retailers like American Eagle want to give 10% off on certain purchases. Users can download that coupon on their Google Wallet and then go to American Eagle and use that coupon along with the money that they have in their account. He also revealed that First Data will provide other features like deeper gift card integration where consumers can reload virtual accounts in Google Wallet using their credit and debit card. George Zirkel believes that plastic cards to have their presence in the United States but soon mobile payments will become easy option for the consumers because they have better options with mobile payments.