IMGCAP(1)]
Heartland Payment Systems Inc. expects to offer all of its new merchants the option to accept American Express cards beginning Jan. 1, Robert Baldwin Jr., Heartland president and chief financial officer, told analysts during a conference call this week. Earlier this year, Heartland said it would become a third-party acquirer for American Express Co. (CardLine, 1/22) and in June announced a similar agreement with Discover Financial Services for Discover transactions. AmEx and Discover have turned to third-party acquirers to expand their card acceptance locations, especially among smaller merchants. Merchants, in return, receive consolidated statements containing all of their card-transaction data and a single settlement source. The Princeton, N.J.-based processor already has some merchants accepting AmEx transactions on the Heartland processing system. "Our first-day settlement was $28 a few weeks ago," Baldwin told analysts. Baldwin says he expects 20% to 25% of all new Heartland merchants to accept AmEx transactions, or about 1,000 to 1,200 merchants a month. Revenue will start small on these accounts, he says, but will build over time. Baldwin also said that "almost all of our merchants are signing up for Discover as well as Visa and MasterCard" processing. Heartland has to update its processing platform in order to integrate Discover transactions, a move that probably will happen in the first half of 2009, Baldwin says.
