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Spotlight Innovators

ounded in 2001 and headquartered in Memphis,
Tennessee, Impact PaySystem made their mark
on the payments industry with their Petroleum
F Services. Impact’s Executive Team is composed
of industry veterans, with over 75 years’ combined experi-
ence implementing creative solutions for their customers.
Through strategic alliances with industry leaders like First
Data, Elavon, and Vantiv, Impact PaySystem is able to
design unique solutions for merchants’ individual needs.
Product solutions include credit and debit card processing,
PIN secured and signature-based debit, wireless solutions,
gift card, check services, loan products, Click2Don8 propri-
etary donation product and development services.

What’s New:
Are you getting paid enough?

any sales representatives would agree one of the most important factors in the MLS/Agent/ISO and proces-
sor relationship is the residual payment. Calculating these payments generally involves a complex, tiered
percentage formula. It can be a chore for agents to confirm if they are being paid correctly, but it is often
M worth this effort. Typically, agents are given a residual report with lots of numbers and a payout amount.
However, most agents aren’t schooled on how to dissect these reports to confirm they are being paid according to con-
tract.
Start with merchant billings

“There are many factors that go into the residual evaluation, but the first place an agent should look is the merchant
billing,” stated Emily Karawadra, President of Impact PaySystem, LLC. Since the merchant’s activity is the basis for what
is being collected, determining whether the merchant is being billed according to the Schedule A section of their contract
is your first objective. Karawadra urges agents to pay close attention to what fees have – or have not – been charged, and
how that parallels to the Schedule A. “Errors between the merchant statement and the Schedule A are more common than
most agents expect,” she continued. Most agents take expert care to ensure completion and accuracy when submitting
a merchant’s paperwork. Then, they work hard to get the merchant programmed and ready to accept transactions.
Karawadra believes many agents think it is okay to sit back and wait for the residual payments to start coming in at this
point, but she advises them to double check these payments for accuracy. “Countless times, I’ve found the processor is
not charging the merchant the fees spelled out in the Schedule A,” Karawadra continued. Karawadra often sees errors in
the pin debit interchange area where this fee gets overlooked and doesn’t get billed to the merchant. She warns agents to
watch for this kind of activity, because the agent will have to absorb these fees, and it can drastically reduce their residual
payouts. Another common scenario relates to pass-through fees. If they are built into a contract, these fees should be
passing through to the merchant billing; not coming out of an agent’s residual commissions.
Do a thorough audit
It goes without saying you will need access your merchant’s statements, so it is best to make this request at the onset of
every relationship. Many ISO portals have comprehensive information on the merchant’s transactions, but may not have
a breakdown of the fees, so comparing to the merchant’s actual billings is always best. To audit your payouts, you’ll need
to routinely reconcile between these statement and your residual reports, and Karawadra encourages you to dig deeper
when you don’t see the level of residuals you anticipated. She offers the following steps you can go through to conduct a
thorough audit:
• Review each merchant’s signed Schedule A and keep a spreadsheet of what they should be billed by the processor.
• Double check your merchant is set up on the pricing plan you intended. For example, if you asked for a three-tier
pricing schedule, but on the statement they are being billed on a pass-through interchange schedule, you will want
to address this error right away.
• Check the merchant statement to ensure all transaction fees are being billed correctly, including pin-debit
interchange fees, and any other fees documented in the Schedule A (see more below).

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