By Jeffrey I. Shavitz
Charge Card Systems Inc.
Having been involved in the payments industry for the past decade, I've noticed that ISOs, merchant level salespeople (MLS) and other payment professionals are constantly talking about money in some way or another. Credit card processing receipts, residuals, debit fees, working capital, cash advance: these all represent aspects of money in our sphere.
This came to mind when I spent a few hours on an airplane over the Thanksgiving holiday and began jotting down notes about money to prepare for an in-depth conversation with my three children (who are 14, 12 and 7 years old). I wanted to give them a sense of the value and meaning of money. I also wanted them to understand, in very basic terms, the evolution of money, particularly how it has changed since I was a youngster.
I vividly recall my childhood piggybank (in the shape of a basketball player) that held all of my pennies, nickels, dimes and quarters. Every few months, I would wrap the coins in the special paper tubes and bring them to the bank to exchange for a $5 bill - if I were to be so lucky.
I also remember calling my parents collect several times as a youth. How relieved I was to hear them tell the operator they would accept the call when I had no money to place a call from a pay phone. When was the last time you used a pay phone? At what age did your children get their first cell phones? How disconnected from the world do you feel today if you leave the house without your smart phone?
Twenty years ago, when my wife and I were going out, she used to ask, "Do you have money in your wallet?" Now she asks, "Do you have your credit card with you?" Some folks still carry lots of cash in their wallets; however, that practice is more the exception than the rule nowadays. A better question is, "Do you use your credit card, debit card, prepaid card, stored-value card or your gift card?"
Then as now, money enables us to afford "stuff" and, as George Carlin used to eloquently say in his comedy routines, "Your stuff is my sh-t and vice versa."For generations people have asked whether money can buy happiness. What do you think? Does money serve as a scorecard for your professional success? Would your life change significantly if you made a lot more money? Would you live a different lifestyle? Would you buy more things? Would you be happier?
No matter whether we consider ourselves to be rich or poor, we still need to manage our money well. Consider the celebrities who make millions of dollars but then go broke. Why don't they understand the value of money and how to manage their resources? The same could be asked of those responsible for the Lehman Brothers collapse, the Madoff swindle, the banking crisis, the mortgage industry meltdown and so on.
Given all of this, how can we ensure our money will remain safe for our needs and those of future generations? How much could the Federal Deposit Insurance Corp. do if our banks were to fail en masse?
We've all heard talk about the looming cashless society that is expected to define our future. Perhaps that future is already here with smart-phone payment terminals, person-to-person payments, mobile wallets and many other technological innovations that appear to affirm physical wallets soon will become antiquated (even family photos will be uploaded to our smart phones). And with tokenization, widespread Payment Card Industry Data Security Standard compliance and other security measures, electronic funds will be transferred back and forth safely, and carrying cash will be considered quaint.
I tried to explain all of these things and more to my children. In doing so, I realized I'm still amazed by the credit card industry and how the technology of bankcard terminals, issuing banks, acquiring banks and the whole flow of money really works.
To think that I pull out my credit card, pay for a slice of pizza on a $200 POS terminal, and then a day later, the money magically appears in the merchant's bank account - and a few weeks later, the charge appears on my credit card statement. This is truly the way our industry operates, and sometimes I think many ISOs and MLSs forget the magic we are involved in. It's good to remember how remarkable the payments industry actually is.
Maybe these thoughts collected for my children will spark some additional thoughts for you. It's amazing to grasp how, in just a few short years, our evolving industry and the transformation of money have had such great influence on daily life for us all.
Jeffrey Shavitz is one of the founders of Charge Card Systems Inc. He is an active member of The Green Sheet Advisory Board and the First Data ISO Advisory Board and a frequent contributing writer to The Green Sheet. He can be reached at jshavitz@chargecardsystems.com or 800-878-4100. For additional information on CCS, please visit www.chargecardsystems.com.
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