I fully agree that the ISOs that “rip & run” their merchants have got to go. I was hoping that Square’s James McKelvey actually believed that as well.
Also, subjecting retail merchants to using Square’s device will just make them mad when they are busy. The screen keyboard is wholly inadequate for volume transactions, yet I would wager that Mr. McKelvey has the merchants locked into a single- to multi-year agreement with a hefty cancellation fee. I really hope that isn’t true.
I was about two-handshakes away from forming a regional ISO/MSP here on the East Coast a little over a year ago that would have mandated training for all agents and periodic performance reviews of the merchants. If McKelvey really wants to address the problem, then he and the rest of the industry need to go back to the model of regional activity so the agents who sell a plan to a merchant are within arm’s reach of the merchant and are responsible to the merchant when something happens.
Selling merchant services over the phone or Internet from a thousand miles away with no accountability when something (invariably) goes wrong is just that, wrong.
Organizations that conduct business like this are the reason that Congress got involved in the business in the first place, although I do believe that Visa, MasterCard, Discover and American Express are making way too much money in an era of electronic transactions. When they were all called in or processed by paper receipts, then the profit margin probably had some bearing on reality. Now that they are processing 99.9% of their transactions electronically, their margins are ridiculous.
Anyway, that’s my 2 cents worth. Unless I use a debit or credit card, then I must charge you a nickel to keep any semblance of my profit margin.
Wes Krohn
The Krohn Group Inc.
