Retailers

Point-of-sale terminal maker Hypercom Corp. this week reported a $624,000 fourth quarter profit, marking the Scottsdale, Ariz.-based company’s third consecutive profitable quarter. Hypercom reported a $74.8 million loss for the fourth quarter of 2008.

A recent study that focuses on Payment Card Industry Data Security Standard compliance among large merchants also is helpful for educating ISOs and the smaller merchants with which they typically work, observers note. ISOs should educate themselves not only about their specific markets but also about all aspects of data security and compliance in the payments industry to better serve their clients and ensure all merchants protect card data, they say.

Point-of-sale terminal maker Hypercom Corp. yesterday reported a $624,000 fourth quarter profit, marking the Scottsdale, Ariz.-based company’s third consecutive profitable quarter. Hypercom reported a $74.8 million loss for the fourth quarter of 2008.

No official movement is afoot to switch to EMV in the U.S., which is becoming increasingly Balkanized as the only major global region not moving to the more-secure chip-and-PIN technology. But a Visa Inc. executive is among experts suggesting that, though issuers, acquirers and merchants may be resisting the shift for a variety of reasons, EMV technology itself is not the biggest obstacle preventing the U.S. from adopting the standard.

First National Bank of Omaha plans to relinquish controlling interest in its First National Merchant Solutions merchant-acquiring arm to Total System Services Inc. in a joint venture the companies announced today.

Though a few large merchants fail to achieve compliance with the Payment Card Industry Data Security Standard, many rely on alternative compensating controls to comply, according to a report released today by Thales Group and the Ponemon Institute. Many large merchants also are paying an average of $225,000 per year for PCI audits, according to the report.

Five years ago, biometric payments seemed ready for the American mainstream. Backers predicted that financial institutions and retailers soon would use fingerprint, palm, vein, iris or facial scans to verify consumers’ identities for ATM and point-of-sale transactions.

Despite a fourth quarter net loss Heartland Payment Systems Inc. attributes largely to breach-related expenses, the Princeton, N.J.-based payment processor sees “encouraging progress” in small and midsize merchant transaction-processing volume and same-store sales, Robert Carr, Heartland chairman and CEO, told analysts during a conference call last week.

Sales agents for ISOs increasingly are seeking additional industry training to improve their abilities to better compete for scarce business during the difficult economy, observers note.

Attendees of the ATM Industry Association show in Miami last week crowded around an ATM some believe could revitalize ISOs that sell ATMs and are suffering from shrinking margins and a lack of new ideas to generate revenue.

Many organizations, such as banks, local business associations, Web-site designers and software developers, refer their customers to independent sales organizations and acquirers for merchant-processing services. The ISO or acquirer then shares with those organizations a percentage of its processing revenue. Or it may provide the referring organization a one-time finder’s fee when the merchant begins processing transactions.

VeriFone Holdings Inc. is supplying 130,000 payment products to Russian bank Sberbank in a multimillion-dollar deal announced today, according to the San Jose, Calif.-based payment-terminal manufacturer. Sberbank is Russia’s largest bank.

Merchant-portfolio sellers that harbored visions of selling their portfolios at 36 times their monthly residual revenue finally have acquiesced to buyers’ demand to pay less, say observers of the acquiring market. Residual revenue is the recurring transaction revenue acquirers collect from merchants.

Sales agents for independent sales organizations increasingly are seeking additional industry training to improve their abilities to better compete for scarce business during the difficult economy, observers note.

Some independent sales organizations are providing qualified leads to sales agents as incentives so they will work harder. The tactic tends to motivate the agents while enabling the ISO to spend less on incentives than they would through monetary bonuses, according to some observers.

Dejavoo Systems has signed a distribution deal enabling Tasq Technology Inc. to resell Dejavoo products, the Syosset, N.Y.-based point-of-sale equipment maker announced today. Tasq is a Rocklin, Calif.-based POS-equipment distributor.

Ritz Interactive Inc. says it is using payment-processing technology from Merchant e-Solutions Inc. to support its more than 18 Web sites, which include RitzCamera.com and Wolf Camera.com. Ritz began using the service a few months ago but only recently made the deal public.

Though merger-and-acquisition activity has been fairly quiet in the past 18 months, activity began to pick up in the fourth quarter of 2009, says Ray Sobczyk, a senior associate and strategic acquisitions expert at the Strawhecker Group consultancy who helps merchant-portfolio buyers and sellers make deals. And the activity is expected to continue this year.

A sales agent presents a proposition to move a portfolio of merchants from one ISO to another. While it sounds like a good deal for the ISO that receives the portfolio, it might not be. The ISO that accepts the merchant portfolio could be sued, even if it has not signed a written contract agreeing not to move the merchants in question.

Merchants always are interested in the cost of payment card processing, but sales agents should evaluate the importance of price when listening to merchants about their needs, observers say.