The Green Sheet :: Company Profiles

A full-course business

What do merchants want from their ISOs and merchant level salespeople (MLSs)? Trust. When faced with decisions, merchants want to be confident their partners will make ethical, smart choices.

ISOs and MLSs are looking for the same trust in their processors. Credomatic USA has an established history, a solid reputation and strong backing to offer ISOs and MLSs peace of mind.

Savory recipe

Credomatic, founded in Miami more than 25 years ago, is a division of BAC Credomatic Group, which is 49% owned by GE Money, a trade name of GE Consumer Finance Inc.

It focuses on the U.S. acquiring market, offering a wide range of payment solutions and POS systems.

Credomatic's 50 employees support merchant services operations in the United States, as well as issuing and acquiring services for banks in the Caribbean and Central America.

As a worldwide acquirer and issuer of bankcard transactions, BAC Credomatic's numbers are impressive. It has offices in nine countries, serves more than 90,000 merchants in 20 countries, and processes more than $3.5 billion in credit and debit card processing volume annually.

BAC Credomatic supports more than 65 financial institutions and 1.5 million cardholders; it has more than $4 billion in assets. Citing its established history and record sales volumes, John Dorris, Vice President of Merchant Services for Credomatic, said the company "is positioned to be a leading player in the bankcard industry for many years to come."

Comfort food

A variety of factors make Credomatic an attractive partner for ISOs and MLSs. First, it has the support of two powerful entities. "With the backing of Credomatic Network and GE, we always try to make it possible," Dorris said.

Another important feature is Credomatic's well-established name in the payments arena. A universal concern among ISOs and MLSs is whether their processors will be sold and if so, how changes in ownership will affect them. Dorris said Credomatic's history helps ease some of those anxieties.

"There is a little more assurance that their [the agents'] residuals are protected and safe when you have a company that has been in business in Florida since 1981 and in processing since the beginning of credit cards," Dorris said.

ISOs and MLSs want to depend on their partners. "Because Credomatic has been in existence for so long and because we are owned by GE, our code of ethics is increased," Dorris said. "Agents can go to bed not worrying about their residual income."

Dorris also said his company practices fair and honest treatment, noting that it makes no sense to put his company's reputation at risk.

New ingredients

Credomatic has enjoyed success and built a large, profitable organization, but that doesn't mean its leadership is ready to set the cruise control and let the company run itself. Even at the top of its game, Credomatc must continue to evolve and develop, or it will be surpassed by the competition.

To that end, Credomatic has achieved several new milestones within the past year, including forming new partnerships and offering enhanced services.

This year, it expanded its relationship with Telecommunications Systems Inc. to support in-house payment solutions, including electronic checks and gift cards.

According to Dorris, both solutions help merchants make the most of their time and resources. "These are all billed with credit and debit cards on a single merchant statement and settled on a single batch deposit," he said.

Credomatic also formed a marketing agreement with merchant cash advance provider AdvanceMe Inc. Under the terms of the agreement, Credomatic will offer ISOs, MLSs and merchants an integrated merchant funding solution that is repaid with future credit card receivables from Credomatic processing services.

Credomatic also introduced a new funding option, which enables it to offer merchants guaranteed next-day funding if requests are submitted before the 9 p.m. EST deadline.

It also offers a premium funding program, with a 1 a.m. EST deadline, targeting the hospitality industry.

"This is an exciting advantage for Credomatic sales partners to offer their clients funding that beats the banks," Dorris said. "Such funding options are attractive to many merchants, especially those who need quick access to cash, such as gas stations, restaurants and convenience stores."

Eclectic tastes

Since Credomatic is part of a large organization, some may assume it prefers to deal only with larger retailers or that it isn't flexibile enough to work with smaller merchants. Neither is the case.

Credomatic is interested in working with a variety of merchant sectors. "We are willing to look at deals of all sizes, and that is our strong point," Dorris said.

Credomatic tailors merchant agreements and pricing case by case. While it focuses on retail merchants, the company also works with some high-risk industries, including airlines and travel agencies.

In addition, Credomatic welcomes ISOs and MLSs of all sizes and in any location. ISOs partnering with Credomatic don't worry that their volume, or the fact that they serve small or mid-sized merchants, will affect the service levels they receive.

"Whether it's the merchant only doing $1,000 a month or doing $20 million, they are treated the same in our customer service department," Dorris said.

Credomatic's primary marketing channel is the ISO and MLS community. The company offers a free terminal placement program, based on VeriFone VX570 terminals.

It also offers integrated solutions, with all payment services billed on a single statement and settled with a single deposit. So merchants don't need to reconcile multiple statements.

Bilingual support is available during normal business hours for merchants as well as ISOs and MLSs. After-hours calls are forwarded to TSYS Acquiring Solutions.

Dorris believes Credomatic has created an agent program that rewards ISOs and MLSs for a variety of services. “We offer lucrative upfront and residual income opportunities, with daily, weekly and monthly income streams," Dorris said. Agents can choose from two programs: a partner solutions program and a referral program.

Menu options

Credomatic's referral program is designed for agent banks, POS resellers, software developers and trade associations. Partners who choose the referral program simply refer processing leads to Credomatic sales partners to earn upfront and residual income opportunities.

"We close the deal," Dorris said. "This is more for POS suppliers, banks or organizations that have members and want to offer a member service.

We give them a piece of the action, but it's not the same residual stream of an agent."

While ISOs or MLSs can choose the referral program, they would earn more revenue from the partner solution program, designed specifically for them.

Agents working with the partner solution program earn upfront income, as well as ongoing residuals on all processing services.

"It's a true revenue share program, 50%, 60%, 70% of revenue above interchange and our processing costs," Dorris said. In addition to the 50% to 70% revenue share, Credomatic pays agents activation and placement bonuses of $100 to $200 per merchant. Additionally, agents are rewarded with a 1% conversion bonus, up to $1,000 per account, when they convert merchants to Credomatic.

ISOs and MLSs also have equipment revenue opportunities, earning 100% of the margin on terminal sales and leases. And Credomatic offers a Web-based POS solution. When agents sell or lease this solution, they earn commissions of 10% to 15% of the revenue share.

For agents who focus more on nonbankcard activations, Credomatic offers income opportunity as well.

It supplies one-time payments of $25 for each gift card and Discover Financial Services activation, and $50 for each American Express Co. and check verification/guarantee activation.

Additionally, ISOs and MLSs who sell the merchant cash advance program receive a one-time 4% commission up front, as well as a monthly 1% commission on the payback amounts.

Credomatic wants to be an equal partner to ISOs and MLSs. With a 25-year history, the support of GE Money and daily, weekly and monthly income opportunities, it works to create safe and lucrative relationships with its ISOs and MLSs.

"We treat everyone as a partner," Dorris said. "When you come on board to submit deals, you are going to be able to sleep well at night knowing your portfolio is secure and you can grow your business here."