Retailers

Residuals are a standard form of payments revenue for ISOs and sales agents, but the weak economy, decreased transaction volumes and margin compression are making it more difficult for individuals to subsist on residual income alone. As some agents’ residuals grow tenuous, more salespeople are expressing interest in up-front revenue to bolster their incomes.

Compliance among small merchants with the Payment Card Industry Data Security Standard remains relatively low, but ISOs may be able to increase compliance rates in their portfolios by launching multifaceted campaigns, some industry insiders suggest.

An Internal Revenue Service initiative announced earlier this month could spur independent sales organizations and merchant acquirers to assess how they classify their staffs, Holli Hart Targan, president of the Electronic Transactions Association, noted at the Southeast Acquirers Association conference this week in Atlanta.

One of mobile payments’ lures for merchants may be the opportunity to deliver coupons, rewards and other customized marketing offers directly to consumers through mobile handsets at the point of sale. Wireless phones enabled with two-way Near Field Communication technology could ignite such marketing opportunities, experts believe.

FrontStream Payments Inc. will double its annual transaction-processing volume to $2 billion following last week’s acquisition of Fast Transact Inc., a Lacey, Wash.-based independent sales organization, FrontStream CEO Emmet Seibels tells PaymentsSource.

Both novice and seasoned sales agents for independent sales organizations can have difficulty understanding exactly where they earn their revenue because not every ISO defines and pays residuals in the same way, note observers.

The weak economy, decreased transaction volumes and margin compression in the payments industry are increasing the importance of up-front revenue streams for independent sales organizations and their sales agents instead of revenue purely from residuals, industry insiders say.

Ingenico SA, a France-based point-of-sale terminal maker, foresees a return to growth this year after posting declining revenue and profit results for 2009 compared with 2008.

Guest Column

Guest Column. From the March 2010 issue of ISO&Agent.

From the March 2010 issue of ISO&Agent.

From the March 2010 issue of ISO&Agent.

From the March 2010 issue of ISO&Agent.

From the March 2010 issue of ISO&Agent.

Will Detterman, the chief executive of Leap Payments Inc., admits he is taking a chance in introducing a payment card acceptance pricing model that bucks the traditional formula.

Some ISOs 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.

Chase Paymentech LLC this week announced plans to extend its offer of fraud-detection services for card-not-present transactions to all of its merchant customers later this year. The Dallas-based processor will integrate Kount Inc.’s fraud-detection services so merchants of all sizes may use them without requiring a separate contract with Boise, Idaho-based Kount.

More than 300 T.G.I. Friday’s restaurants plan to use a payment card security method that masks sensitive transaction data with a numerical token, says Merchant Link, the company providing the TransactionVault service.

International expansion will not benefit every company, and merchant-service providers that want to expand outside the United States should carefully evaluate their business models to determine whether such a strategy is feasible, some observers note.

Merchant Warehouse Inc. says its mobile payment-acceptance software for smartphones now works with devices using Microsoft Corp.’s Windows Mobile and Google Inc.’s Android operating systems.