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EMV and the open ers and other vendors typically offer a 48-month lease; a less common option is
60 months. And if a merchant agrees to a $100 per month lease, that could mean
floodgates for as much as a $3,200 payment to the ISO upfront, wired the next day.
And for an MLS, their percentage of that close upfront, as well as ongoing
equipment residuals, can allow for recruiting into multiple sales industries that do not
offer such a large per-account referral bonus.
leasing The first issue to address when negotiating such a contract is when the lease
financing company will force the ISO to repurchase the lease under a buyback
By James Huber or chargeback clause. For that clause, negotiation will likely exist on whether
the repurchase price is the full amount or the amount funded to the ISO.
Global Legal Resources LLP Negotiation may also exist on what events and the amount of time need to pass
to trigger the buyback clause.
ith Europay,
MasterCard and Visa The pricing and fee split usually depend on volume commitments or personal
(EMV) becoming more relationships. But many other terms are negotiable and will help an ISO
W "real," many ISOs and monetize the relationship, as well as help the leasing company avoid liability
merchant level salespeople (MLSs) from overly aggressive sales agents.
are pitching merchants with the prop-
osition that they need new equipment Leasing liability – is the income worth the potential liability?
to comply with EMV regulations.
And EMV has thus opened the door EMV hype aside, leasing still carries a nasty reputation. Merchants may
for ISOs to capitalize on or enter the complain that they are paying the same amount to lease a $500 machine that
highly lucrative equipment-leasing they would to lease a brand new Miata. The pitch, of course, is that what
business. merchants pay in leasing, they make up for in their processing fees.
EMV has cast aside the "leasing is
dead" naysayers and allowed for cer-
tain ISOs to make a serious profit. But
the leasing model's reputation and
pitfalls can leave uninformed and ill-
advised ISOs reluctant to push leases
or cause them to fall on their faces
when they do. If done correctly, how-
ever, equipment leasing can cause an
ISO's income to surge.
Negotiating a good
leasing contract
The first step to monetizing equip-
ment leases is negotiating a good
reseller agreement. The self-fund-
ing lease, meaning you collect the
monthly lease amount yourself, is not
a lucrative model because it leaves the
sales organization holding the risk
and duty of collecting payments.
But with a solid lease finance rela-
tionship, ISOs will ensure upfront
payments that help the bottom line
and create huge incentives for MLSs.
A quick stroll around a tradeshow
floor or perusal through The Green
Sheet will present multiple options
for leasing vendors. The major play-
29
EMV and the open ers and other vendors typically offer a 48-month lease; a less common option is
60 months. And if a merchant agrees to a $100 per month lease, that could mean
floodgates for as much as a $3,200 payment to the ISO upfront, wired the next day.
And for an MLS, their percentage of that close upfront, as well as ongoing
equipment residuals, can allow for recruiting into multiple sales industries that do not
offer such a large per-account referral bonus.
leasing The first issue to address when negotiating such a contract is when the lease
financing company will force the ISO to repurchase the lease under a buyback
By James Huber or chargeback clause. For that clause, negotiation will likely exist on whether
the repurchase price is the full amount or the amount funded to the ISO.
Global Legal Resources LLP Negotiation may also exist on what events and the amount of time need to pass
to trigger the buyback clause.
ith Europay,
MasterCard and Visa The pricing and fee split usually depend on volume commitments or personal
(EMV) becoming more relationships. But many other terms are negotiable and will help an ISO
W "real," many ISOs and monetize the relationship, as well as help the leasing company avoid liability
merchant level salespeople (MLSs) from overly aggressive sales agents.
are pitching merchants with the prop-
osition that they need new equipment Leasing liability – is the income worth the potential liability?
to comply with EMV regulations.
And EMV has thus opened the door EMV hype aside, leasing still carries a nasty reputation. Merchants may
for ISOs to capitalize on or enter the complain that they are paying the same amount to lease a $500 machine that
highly lucrative equipment-leasing they would to lease a brand new Miata. The pitch, of course, is that what
business. merchants pay in leasing, they make up for in their processing fees.
EMV has cast aside the "leasing is
dead" naysayers and allowed for cer-
tain ISOs to make a serious profit. But
the leasing model's reputation and
pitfalls can leave uninformed and ill-
advised ISOs reluctant to push leases
or cause them to fall on their faces
when they do. If done correctly, how-
ever, equipment leasing can cause an
ISO's income to surge.
Negotiating a good
leasing contract
The first step to monetizing equip-
ment leases is negotiating a good
reseller agreement. The self-fund-
ing lease, meaning you collect the
monthly lease amount yourself, is not
a lucrative model because it leaves the
sales organization holding the risk
and duty of collecting payments.
But with a solid lease finance rela-
tionship, ISOs will ensure upfront
payments that help the bottom line
and create huge incentives for MLSs.
A quick stroll around a tradeshow
floor or perusal through The Green
Sheet will present multiple options
for leasing vendors. The major play-
29
