Posts Tagged ‘vms-washington’

This is a great video that explains PCI Compliance.  VMS-Washington encourages all business owners to learn more about credit card processing so they can save more money on their processing, learn better ways to processing and to know right from wrong when talking to a potential credit card processor.

If you’re interested or want more information about interchange and better rates from an “A Rated” company contact us, VMS-Washington is giving businesses the Summer Deal of the Year.  For a limited time we are offering rock bottom rates for new and existing businesses.  The questions we always ask business owners are:

  • Have you checked out your current or potential merchant service company on the BBB?
  • Does your current provider or potential provider promote your business?
  • Does your current provider or potential provider send referrals your way?
  • Are you getting the best rates in town?
  • Has your current or potential merchant told you about the Durbin Amendment?

Wouldn’t you want an A rated company that and will promote your business though their social media and monthly newsletters.  For more information contact us.

Thank you,

VMS-Washington
washington@valuedmerchants.com
www.vms-washington.com
800.531.8575 ext.697

Business owners,

VMS-Washington is passionate about saving business owners money on their processing and cut their business costs.  How do we do it?  Simple, we provide you with A rated services, give you rock bottom rates,  help you with better business practices through our preferred partners and educate you on credit card processing.  How can we give you better rates than other merchant service providers?  We process over 100+ million a day in business which means we can ask for better rates and fees.  Due to the overwhelming replies we are eager to help business owners by giving you great rates and fees and with those great rates we also promote you business for free though our 44,000+ in our network.  What would you do with your extra savings?

  • Invest in your company?
  • Pay off some bills?
  • Buy more inventory?
  • Pay for lunch for your employees?
  • Do more advertising?

VMS-Washington helps all businesses, it doesn’t matter if you process $500 dollars a month or 500,000 a month, you’ll get great rates and fees from us.  We’ll help all types of businesses, non-profits and charities. For example:

  • Churches
  • Charities
  • Mom & Pop stores
  • Franchises
  • Grocery stores
  • Auto dealerships
  • Restaurants
  • Bars & pubs
  • Hotels
  • Web based companies
  • Any and all businesses

So why pay high rates when you can be with a company that will give you low rates and fees and promote your business for free.  We ask potential clients these questions:

  • Are you happy with your current provider?
  • Do they send you referrals?
  • Do they promote your business?
  • Have you checked them out on the BBB?
  • Do they give you $50.00 per referral?
  • How many referrals have you received from them?
  • Have they told you about the Durbin Amendment?

To sum it up.  VMS-Washington will beat every processor out there and give you the best rates and if we can’t we’ll give you $500.00 cash!  Contact us if you want to save money on your processing and help you save on other business costs.

Thank you,

Michael Roberts

VMS-Washington
www.vms-washington.com
800-531-8575 ext. 697

This is a great video that explains what’s behind credit card transactions.  VMS-Washington encourages all business owners to learn more about credit card processing so they can save more money on their processing, learn better ways to processing and to know right from wrong when talking to a potential credit card processor.

If you’re interested or want more information about interchange and better rates from an “A Rated” company contact us, VMS-Washington is giving businesses the Summer Deal of the Year.  For a limited time we are offering rock bottom rates for new and existing businesses.  The questions we always ask business owners are:

  • Have you checked out your current or potential merchant service company on the BBB?
  • Does your current provider or potential provider promote your business?
  • Does your current provider or potential provider send referrals your way?
  • Are you getting the best rates in town?
  • Has your current or potential merchant told you about the Durbin Amendment?

Wouldn’t you want an A rated company that and will promote your business though their social media and monthly newsletters.  For more information contact us.

Thank you,

VMS-Washington
washington@valuedmerchants.com
www.vms-washington.com
800.531.8575 ext.697

VMS-Washington – Behind Credit Card Transactions Video

This is a great video that explains Fraud.  VMS-Washington encourages all business owners to learn more about credit card processing so they can save more money on their processing, learn better ways to processing and to know right from wrong when talking to a potential credit card processor.

 

 

If you’re interested or want more information about interchange and better rates from an “A Rated” company contact us, VMS-Washington is giving businesses the Summer Deal of the Year.  For a limited time we are offering rock bottom rates for new and existing businesses.  The questions we always ask business owners are:

  • Have you checked out your current or potential merchant service company on the BBB?
  • Does your current provider or potential provider promote your business?
  • Does your current provider or potential provider send referrals your way?
  • Are you getting the best rates in town?
  • Has your current or potential merchant told you about the Durbin Amendment?

Wouldn’t you want an A rated company that and will promote your business though their social media and monthly newsletters.  For more information contact us.

Thank you,

VMS-Washington
washington@valuedmerchants.com
www.vms-washington.com
800.531.8575 ext.697

 

VMS-Washington – Savings of 29.82%

VMS-Washington saved WiPliance 29.82%, that’s $6471.15 a year and $25,884.58 for 5 years!  We can beat anyone out there 20-60% off their current provider with average savings of 47.01%. Valued Merchant Services offers a free cost analysis to compare your current provider to us. In addition, anyone that sends us business our way will get $50.00 when sign the client signs. We also challenge you to beat our rates, if we can’t we will pay you $500.00 Cash. Has your current processor told you about the Durbin Amendment and how it can save you money on your processing rates and fees?

Due to the overwhelming replies and inquiries VMS-Washington wants to help your business out by giving you rock bottom rates for your processing.  We also can help your business by giving you great rates for unsecured business loans with an 90% approval rate for start-ups and existing businesses.  Call or email us if you want to know more.

Michael Roberts

VMS-Washignton
www.vms-washington.com
washignton@valuedmerchants.com
(800) 531.8575 ext. 697

This is a great video that explains chargebacks.  VMS-Washington encourages all business owners to learn more about credit card processing so they can save more money on their processing, learn better ways to processing and to know right from wrong when talking to a potential credit card processor.

If you’re interested or want more information about interchange and better rates from an “A Rated” company contact us, VMS-Washington is giving businesses the Summer Deal of the Year.  For a limited time we are offering rock bottom rates for new and existing businesses.  The questions we always ask business owners are:

  • Have you checked out your current or potential merchant service company on the BBB?
  • Does your current provider or potential provider promote your business?
  • Does your current provider or potential provider send referrals your way?
  • Are you getting the best rates in town?
  • Has your current or potential merchant told you about the Durbin Amendment?

Wouldn’t you want an A rated company that and will promote your business though their social media and monthly newsletters.  For more information contact us.

Thank you,

VMS-Washington
washington@valuedmerchants.com
www.vms-washington.com
800.531.8575 ext.697

VMS-Washington Travel Tips – 25 Travel Tips to Live By

 

1. Fly on a Tuesday, Wednesday, or Saturday. Traveling on off-peak days—and at off-peak times—means lower fares, a less crowded cabin, and a greater chance of snagging those elusive mileage-award seats. Taking two days off for a long weekend? Instead of a Thursday–Sunday or Friday–Monday trip, save money by flying on a Saturday and returning on a Tuesday.

2. Buy airline tickets midday on Tuesdays. When I purchase a domestic ticket, I usually do it on a Tuesday between noon and 3 p.m. Airlines tend to announce fare sales on Monday nights, and other airlines match those sales on Tuesday mornings, explains Rick Seaney, CEO of FareCompare.com, which means that by 3p.m. on the East Coast and by noon Pacific time, the greatest number of sale tickets has hit the system.

3. Snag mileage-award seats six months ahead or over a weekend. Some people mistakenly think that the trick to using miles is to book award seats the moment a flight is put in the reservation system—often 331 days ahead of departure. Statistically speaking, though, you have the best shot at nabbing seats you want six months before your flight. Airline sites often don’t display all the available award seats, so if you’re not finding what you need, call the mileage-award redemption desk. I’ve gotten award tickets for my family of four several times by following frequent-flier guru Randy Petersen’s advice to phone just after midnight over the weekend: Airlines update their inventory on Fridays and occasionally on Saturdays—changes that go into effect at midnight—yet most people don’t call until Monday, so over the weekend you have more availability and agents will have the time to work with you.

4. Pounce on international business-class fare sales in January and August.There are four periods when business travel slows and airlines drop business-class fares to lure vacationers: Easter, summer, Thanksgiving, and the Christmas/New Year holiday. Lately, airlines have been announcing summer sales early in the new year and winter sales in August. They barely promote these sales, so I keep on top of them by subscribing to JoeSentMe.com ($49 per year).

5. Get into a sold-out hotel. Find out when cancellation penalties kick in for the date you want to arrive, then call the property on the morning of that day. You can scoop up rooms made available by people who’ve just canceled.

6. Stay over Sunday. Many hotels get Friday and Saturday night bookings from leisure travelers and Monday-through-Friday traffic from business travelers, so there’s a void on Sunday night—which increases your chances of an upgrade. Instead of going for Friday and Saturday nights, book Saturday and Sunday or Sunday and Monday.

7. Hop between cities at midday. When you’re traveling through Europe or Asia and need to get from one city to another, consider scheduling transportation for the middle of the day. If you leave at dawn, you miss the sunrise—ideal for photography and observing locals—and reach your destination at mid-day, when temperatures are highest, the light is at its worst for photos, and it’s too early to check into your hotel. (You may also have to fight rush-hour commuters and miss a breakfast that is included in your rate.)

8. Visit islands during shoulder season. Peak-season rates on islands often reflect nearby countries’ vacation schedules rather than the best time to visit (Bali’s hotels, for instance, fill up with Japanese in early May and with Australians in January). In low season, many businesses shut down. Shoulder season—when crowds are thinner but the weather is still good—is the solution.

VMS-Washington Travel Tips – 25 Travel Tips to Live By

Find the Hidden Deals

9. Sign up for e-mail notifications. The best airfare and hotel sales are largely unannounced. Airlines and hotel companies target specific subsets of travelers—loyalty program members, holders of certain credit cards, people who’ve registered on their Web sites—and alert them by e-mail. To keep your in-box from being bombarded, get a dedicated e-mail address for such alerts and check it when you’re ready to start planning your next trip. If you can make quick purchasing decisions, sign up for alerts from flash-sale sites that sell hotel rooms at discounts of 40 percent or more, such as Jetsetter and Tablet Hotels.

10. Carry credit cards that earn you elite status. Play your travel-rewards credit cards right and you’ll receive special rates and perks. Carry one airline-branded card and one hotel-branded card that help you attain and maintain elite status—and make sure that at least one of those cards charges no foreign-purchase fee (preferably a Visa or MasterCard, since those are more widely accepted overseas than American Express).

11. Lock in business-class bargains from Etravelbid.com. Etravelbid.com negotiates unpublished, discounted business-class fares with no advance-purchase requirement. In November, snag a last-minute flight from New York, Boston, or Chicago to Dublin for $2,300; from Miami to Berlin for about the same; or from New York to Hong Kong, via Seoul, in the upstairs business-class cabin of an A380, for $4,500 (prices include all taxes and fees).

12. Find mileage-award seats on routes that connect airline alliances’ hubs.Competitours founder and CEO Steve Belkin taught me this one: Suppose you need to fly from Cleveland to Venice. Don’t bother asking if there are award seats available on that route; there won’t be. Instead, start with the hub-to-hub routes flown by the carriers in your alliance. Say it’s the Star Alliance: Look for availability on flights to Frankfurt, Vienna, Munich, or Copenhagen from Chicago, Newark, Philadelphia, Toronto, or Washington, D.C. (hubs for Star Alliance partners Continental, United, US Airways, and Air Canada). That gives you more than 20 possibilities. Once you’ve found a hub-to-hub flight with award seats, tack the short-haul flights on either end.

Use the Right Online Tools


13. Find the most flight choices with ITASoftware.com
This site provides perhaps the most comprehensive and least biased fare and route options. Use it to learn which airline offers the most suitable itinerary, then go to that airline’s Web site to book. If your schedule is flexible, choose “See Calendar of Lowest Fares,” punch in a monthlong travel window and the length of the trip, and the search engine will tell you when to fly.

14. Sign up for airfare alerts. AirfareWatchdog.com finds unadvertised low fares that other search engines miss—and notifies you daily via newsletter or immediately via Twitter. FareCompare.com alerts you when a fare drops by an amount you’ve specified (say, $50). Both help suss out connecting flights that can save you hundreds of dollars. AirfareWatchdog’s “To a City” alerts list fares from various airports to your destination. Say you want to fly from Houston to Kona, Hawaii. The Houston–Kona fare might be $800, whereas the Dallas–Kona one might be $350. If you’d signed up to see all the fares to Kona, you’d know to combine the Dallas–Kona fare with a cheap Houston–Dallas ticket. As for FareCompare, sign up for alerts to Kona not only from Houston but also from hubs west of it like Los Angeles and San Francisco. If you find a deal saving you $500 from one of those hubs, find a way to get there from Houston.

15. Get seat alerts from ExpertFlyer.com. If you don’t want to return to an airline’s site repeatedly to check whether a better seat has opened up, consider paying $5 per month for an ExpertFlyer membership. Punch in the flight you’re on, and the seat type (e.g., aisle) or rows you want, and you’ll be alerted by e-mail if any of those seats become available. You can also receive alerts on the availability of mileage-award seats and upgrades.

16. Get a better seat with SeatGuru.com and SeatExpert.com. Don’t select a seat without typing the airline and flight number into these sites and checking your location. If you must accept an inferior seat, return to the carrier’s site before your flight to see whether a better one has opened up. When you check in online, do so as early as possible; you’ll often find that seats have become available. And when you’re choosing airlines, use SeatGuru’s “comparison charts” to snag comfier seats and better in-flight entertainment.

17. Use TripAdvisor to connect with a hotel’s general manager. Often a general manager will reply to critiques of his property on TripAdvisor. When you book a room, read the replies, note his e-mail address, and write to him saying that you admire how he’s replying to reviews and that you’re looking forward to staying at his hotel on X date. He’ll appreciate your kind words, assume you may be a frequent reviewer, and hopefully do something extra for you during your stay.

18. Keep your miles from expiring with AwardWallet.com. Nothing’s worse than a big stash of miles that’s just vaporized. AwardWallet shows you all your different mileage accounts at a glance, including expiration dates, so you can take action to keep miles and points from expiring. I use it to track the accounts of everyone in my family: Within seconds I can see whose miles are in danger of expiring or who has enough for a trip, so I can cash in before they devalue.

Find the Right Human Beings


19. Get the best room for your dollar.
 At luxury properties, rates vary substantially according to occupancy. A room could be $550 one week because there’s a big group, and $250 the next because nobody’s coming. For top-end hotels that have on-site reservations desks, call and ask the manager when, during your travel window, the hotel will be emptiest and thus have the lowest rates. Then ask something like, “If I come on that date, would there be a chance of an upgrade to ocean-view?”

20. Score a better room by making requests. If you don’t ask for a great room, you’ll get what’s left over after everybody else’s requests have been filled. Phone the hotel’s on-site reservations manager to ask for a specific view or floor (or ask the general manager when you e-mail him). If you’re celebrating a special occasion (e.g., a birthday or an anniversary), say so. Hotels often do something extra to make sure your stay is memorable so you’ll tell your friends and return for future celebrations.

21. Use the concierge at a top hotel even when you’re not staying there. Most benefit from the extra business and can arrange for cars and drivers, procure hard-to-get tickets, provide names of specialty stores, or recommend English-speaking doctors. At the least, in destinations where a different alphabet is used, they can write down names and addresses of the places you want to visit so you can show them to cab drivers. Be up front about the fact that you’re not a guest—but so charming and friendly that he can’t resist helping you—and be sure to tip.

22. Book through “top producers.” The travel agent who sends the most travelers to a leading hotel or cruise line will be able to get you the most perks. These usually come in the form of resort credits, complimentary meals, and/or free upgrades. Ask an agent whether he is on any travel companies’ advisory boards, or see my list of top travel specialists in the magazine’s December 2011 issue.

23. Hire an English-speaking guide. In a tricky foreign country, the right guide can serve as your expediter and fixer, getting you past lines, showing you secret places you’d never find on your own, introducing you to locals, and helping you to bargain. Guides vetted by the top travel specialists on my list are high-caliber but pricey. Hiring a guide on the spot—at an ancient ruin or in a souk—is a crapshoot but often so in- expensive that it’s worth a shot. If the guide quotes, say, $20 an hour, propose $10 for a half-hour. If you’re disappointed, you can get rid of him with no hurt feelings. If you’re pleased with him, ask him to show you more.

24. Get the mileage-award seats you need with no effort. Gary Leff of BookYourAward.com has saved many a Condé Nast Traveler reader from headaches and despair by showing them how they can use their miles to get where they want, when they want, for fewer miles than they thought possible.

25. Be rescued when you’re stranded by an airline. When a snowstorm—or a volcano in Iceland—closes your airport, Brett Snyder of CrankyConcierge.com will do whatever is possible to get you to a functioning airport and onto a flight out.

Thank you,

VMS-Washington Travel Staff

VMS-Washington – Savings of 32.09%

VMS-Washington saved Flintoft Services 32.09%, that’s $3145.75 a year and 15,728.76 for 5 years!  We can beat anyone out there 20-60% off their current provider with average savings of 46.12%. Valued Merchant Services offers a free cost analysis to compare your current provider to us. In addition, anyone that sends us business our way will get $50.00 when sign the client signs. We also challenge you to beat our rates, if we can’t we will pay you $500.00 Cash. Has your current processor told you about the Durbin Amendment and how it can save you money on your processing rates and fees?

Due to the overwhelming replies and inquiries VMS-Washington wants to help your business out by giving you rock bottom rates for your processing.  We also can help your business by giving you great rates for unsecured business loans with an 90% approval rate for start-ups and existing businesses.  Call or email us if you want to know more.

Michael Roberts

VMS-Washignton
www.vms-washington.com
washignton@valuedmerchants.com
(800) 531.8575 ext. 697

VMS-Washington – 10 Ways to Outsmart the Airlines

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In the past several years, I have flown on many flights —and I have never arrived on time. As awful as that performance is, it doesn’t even reflect the worst travel nightmares of the year, including record numbers of lost bags, overflowing lavatories, and the infamous JetBlue odyssey in which passengers were trapped on the tarmac for nearly 11 hours. In the first half of the year, more than 93,000 flights were canceled, an increase of 44 percent over the first half of 2006, according to the Department of Transportation. Yes, 2007 will go down as the worst year in history for flight delays, cancellations, and stranded passengers since they started keeping records of these things.

How did we get from bad to so much worse? Well, the Federal Aviation Admin­istration is using a nearly 20-year-old computer system, and it shows. Among its many drawbacks, the air traffic control system does not adjust for increasing capacity in the sky. On the morning of June 8, 2007, a common scenario played out: The 20-year-old computers in Atlanta failed, and when the FAA rerouted flight-plan data to Salt Lake City, those computers overloaded. The result? Virtually every airplane on the East Coast was grounded for an average of four hours.

As if that’s not enough, major carriers are understaffed and, as a result, have been canceling hundreds of flights in the last week or so of each month, creating massive delays (and stranding thousands) throughout the hub systems. Northwest, one of the worst offenders, is operating with 15 to 25 percent fewer pilots and copilots than it employed in 2000. The inevitable result is massive crew shortages at the end of each month when Northwest’s remaining pilots “time out” and can no longer fly. (According to federal regulations, pilots may not fly more than 100 hours a month.) In the last week of June, a particularly bad month, Northwest canceled more than 1,000 flights.

VMS-Washington – 10 Ways to Outsmart the Airlines

Regional jets clogging the runways are another huge headache. Flying on one of these puddle jumpers requires you to be a contortionist. But it’s what you don’t see with RJs that really hurts you. Because they take up as much gate space and airspace as the big jets—but carry just 30 to 100 passengers a flight, compared with as many as 365 in a Boeing 777—they are adding more traffic without getting more people to their destinations. Last year, approximately half of Chicago O’Hare’s flights were RJs.

With planes flying near capacity, a delay of a few hours can turn into a 24-hour nightmare. Here’s how it works: If a crew has to wait too long, it can “time out,” and the flight can’t take off until a replacement crew arrives. But if incoming planes are packed and can’t accommodate the replacement crew—well, you’d better find a motel. Here’s how to avoid the crush of modern commercial aviation.

Watch the calendar. Schedule air travel for the first 20 days of the month. That reduces the chances that your flight will be canceled because the pilot or crew has already hit the maximum monthly limit of 100 hours of work.

Avoid “direct” flights. The only good flight is a nonstop flight. Labeling a flight “direct” is an airline euphemism that means you’ll stop at least once, exponentially increasing your chances of being delayed.

Sign up for e-mail alerts. Many airlines offer this service, as do Travelocity and Expedia. Or you can go to flightstats.com, a free service that tracks flights and alerts you when things are going wrong. To have text messages sent to your cell phone alerting you to flight delays, sign up at flightstats.com. You can also find updates at fly.faa.gov/flyfaa/usmap.jsp.

Leave at dawn. Get on the first available flight, preferably on a plane that spent the night at your airport. The biggest factor controlling delays is not where your plane is going, but where the aircraft assigned to your flight is coming from. Always call the airline before you leave for the airport and ask the agent to tell you the aircraft number of the plane assigned for your flight, and then ask for the status of that aircraft tail number. If you’re heading to Los Angeles from Miami in two hours but the aircraft assigned to your flight is in Caracas…you’re not going. To find out how to talk to a real live agent for any given airline, go to gethuman.com.

Get creative. If, despite using these strategies, you find yourself imprisoned for hours in an aluminum tube on the tarmac, you may have to resort to extreme measures. First, passengers who claim to be sick can be removed from the plane. I’m not advocating fraud here, but I could make a case that “sick and tired of being stuck on the runway” is a recognized medical malady, and I can’t imagine any judge failing to sympathize. If you’re more inclined to be a citizen journalist than an amateur actor, you can whip out a video camera. It gets the crewmembers’ attention (they know they’re likely to end up on YouTube, if not CNN), and you’re not doing anything illegal. It worked for David Ollila one night in June, after his Comair flight from New York to Detroit was stuck on the ground for nearly four hours. Ollila interviewed the pilot on camera, and the pilot threatened to call the police. “That’s an excellent idea,” the cameraman responded. Sure enough, the cops came, everyone was let off the plane, and Ollila was cleared of any wrongdoing. Third, there’s the lawyer approach: Claim false imprisonment and demand to be released. After being stranded for nearly nine hours on a Northwest flight in 1999, passengers sued and Northwest settled for $7 million. Ever since, airlines have taken the words false imprisonment very seriously.

Take ’em to court. In what could be the beginning of a trend, a woman named Jane Waun sued Spirit Airlines in small-claims court after the airline canceled her flight out of Detroit, stranding her family. In July, she won a $1,350.75 judgment, which reimbursed her for hotel and meal costs, a lost night at her destination, and the tickets she
had to purchase on a different airline.

Take the train. The surefire way to avoid flight delays: Don’t fly. On short-haul routes (e.g., Los Angeles to San Diego, or New York to Boston), don’t even think of get­ting on a plane. Go with Amtrak. I recently raced a friend from downtown Manhattan to Washington, D.C. Our destination: 17th and K streets in D.C. We both left at the same time. He went to LaGuardia for the Delta shuttle. I headed for Penn Station and Amtrak’s Acela. I beat him by 48 minutes. My fare on Acela: $172. His fare on the shuttle: $276.

Ship your bags. Always ship your bags. Send them via FedEx, UPS, or DHL. Even in the best-case scenario, checking your bags means you’ll have to wait 20 to 40 minutes for them to appear on the carousel. Then you’ll wait in line for a cab with everyone else who checked a bag. Worst-case scenario: Your checked bags go to Vegas while you go to Portland. And you know what happens to things that go on to Vegas.

Avoid major hubs. Use alternate airports. If you can fly into or out of these secondary airports, you’ll reduce your chances of being delayed: Dallas Love Field, instead of Dallas/Fort Worth; Oakland or San José, instead of San Francisco; Houston’s Hobby Airport, instead of Bush Intercontinental; and New York’s Long Island MacArthur, instead of LaGuardia or Kennedy.

Build more time. Airlines sometimes leave only 60 minutes between connections. That’s a recipe for ruining your trip. Choose flights with at least twice that amount of time for your connections and you’ll breathe easier.

Finally, be patient to the flight attendants, check-in desk staff and the TSA, they have no control on what happens to the planes schedule or the long lines.  If you’re carrying anything on the plane make sure its a small bag so you can keep it with you instead of packing it on a overhead storage bin which might be full or away from your seat.  Also, wear light clothes, no jewelry or other items that may keep you from getting through the TSA check-in line quickly.  Most of all, bring snacks, food and a pillow to make your flight a pleasant one because we all know some airlines don’t provide food and if they do its not much to eat.

Thank you,

VMS-Washington Travel Staff

VMS-Washington – Debit Interchange Limit Will Raise Fees on Small-ticket Sales

The effects of the Federal Reserve’s new interchange limit rules on the cost ofaccepting debit card payments will be much more complex than many observers realize. I wrote last week about the strong probability that one consequence of the new fee structure will be the rising cost of accepting PIN-based debit. The same fate will befall merchants accepting small-ticket transactions and this will surely not go unnoticed. One consequence you can be certain of is that issuers will do their best to steer consumers into using the “right” card at the “right” place. Let’s take a look at the dynamics.

The Current State of Debit

The Federal Reserve gives us detailed data on debit and credit card use by card type and amount. Here is the breakdown:

<$5

$5-14.99

$15-24.99

$25+

Number (billion)

% of Total

Number (billion)

% of Total

Number (billion)

% of Total

Number (billion)

% of Total

General Purpose Credit Card

2.1

29%

3.7

25%

2.9

30%

11.2

41%

Signature Debit

3.6

50%

7.3

49%

4.0

42%

8.4

31%

PIN Debit

1.3

17%

3.5

23%

2.6

26%

7.2

26%

Open Loop Prepaid

0.2

3%

0.4

3%

0.2

2%

0.4

2%

Total

7.2

100%

14.9

100%

9.7

100%

27.2

100%

The report notes that:

General purpose credit cards and, particularly, signature debit use were the preferred methods for transactions below $5. Their high share of these low value transactions may indicate the success of card network rules (and promotional campaigns) to allow merchants and cardholders to forego a signature authorization for low value transactions.

Once the Fed’s interchange fee cap takes effect later this year, the card networks will have a much bigger incentive to increase the share of small-ticket transactions paid with a debit card. Here is why.

Why the Interchange Fee Structure Matters

The new rule states that issuers can charge no more than $0.21 per transaction plus 0.05% of the sale’s amount and can charge an additional $0.01 per transaction for fraud prevention measures they have implemented.
In order to make sense of what the new pricing means, we will have to look at how it compares to the (still) current fee structure. As there are many different debit interchange rates, I will only take one that applies to small-ticket Visa debit transactions (and the one that incidentally is of interest here) – the Visa CPS / Small Ticket, Debit – which right now is at 1.55% + $0.04. The table below shows how the two pricing structures compare for amounts of $5, $10, $15, $20 and $25.

InterchangeStructures

Transaction Amount

$5

$10

$15

$20

$25

Old Interchange1.55% + $0.04

$0.1175

$0.195

$0.2725

$0.35

$0.4275

New Interchange0.05% + $0.22

$0.2225

$0.225

$0.2275

$0.23

$0.2325

As you see, under the new structure the interchange fee amount grows very slowly as the sales amount increases, which makes small-ticket transactions much more profitable for issuers on a per-dollar basis. This is due to the much higher weight the per-transaction fee carries in the new interchange arrangement. Crucially, it also means that the new pricing structure will allow issuers to make more money from debit transactions in amounts of up to $11 or so than they currently do. Moreover, as the credit card interchange fees are unaffected by the new rules, bigger-ticket transactions will be much more profitable for issuers if made with a credit card than with a debit card and the difference will only grow with the sales amount.

The Takeaway

So issuers will have a very strong incentive to steer consumers into using debit cards for small-ticket transactions and credit cards – for everything above $11 or so. Exactly how they will do that I don’t know but that they will try I have no doubt.
The other side of the coin is that merchants selling small-ticket items will end up paying higher fees for debit transactions than they currently do.

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Michael Roberts

VMS-Washignton
www.vms-washington.com
washignton@valuedmerchants.com
(800) 531.8575 ext. 697

VMS-Washington