ear Editor:

Thank you for the opportunity to respond to the GS Advisory Board's recent comments regarding ETA. We were happy to see so much interest and support for the association. Our industry recognizes The Green Sheet as a forum to discuss issues and ideas, and we appreciate the opportunity to be part of the dialogue. We were interested in both the questions posed and the answers offered by the GS Advisory Board. In response, there are several items on which we'd like to comment.

With Regard to ETA's Mission and Focus on Members

Since its inception in 1990, ETA has been a trade association dedicated to serving the needs of its members, and more broadly, the needs of the electronic payments industry. As a non-profit association, our sole purpose for existing is to provide service to our constituents in the form of education, information, representation and a community for business development. Although the landscape of our business has changed significantly, today as then, we bring together members of the industry for these fundamental purposes.

Over its 14-year history, ETA membership has grown from 20 to 520 companies offering a wide variety of transaction processing products and services. These members also vary greatly in size and scope, ranging from the very small to the very large. The majority of members (66%) are small companies, many of which are newer entrants to this still growing market.

Although our constituency has changed dramatically, we remain dedicated to our core mission: to fully serve members and advance the profession by providing leadership through education, advocacy and the exchange of information. The hallmark of the association's success has been its ability to adapt to frequent changes in the industry it serves without losing focus on its reason for being.

The existence today of a wide variety of ETA members is testimony to the efficacy and growth of our industry and of these organizations. However, this can be a double-edged sword. What was once an intimate community of small and medium ISOs organized to solve common business problems has evolved into a large, complex environment with a variety of facets and players, all of which affect the culture of ETA and its activities.

Change is a byproduct of success, but one thing remains a certainty. As it has always done, ETA is dedicated to adapting with the times to remain relevant to our members and to creating a welcoming space for everyone, new acquaintances and long-time supporters alike.

With Regard to ETA's Role in Education and Certification of MLSs

Your poll asked about ETA's role in MLS certification. The foundation of all certification programs is education, and education is one of ETA's core purposes. So it is appropriate that the association have a role in a certification initiative for the industry.

However, professional certification is a complex, multi-step process for any organization to undertake. These programs require establishment of a body of knowledge that reflects the many facets of the profession and the expanse of information that an individual must possess in order to be certified.

The programs also require rigorously administered testing to measure and quantify this knowledge. To ensure legitimacy and wide acceptance of the program, things like standards, transparency, liability and enforceability must also be fully addressed. All of this must be accomplished for the program to be credible and to stand the test of time.

With creation of the Electronic Transactions Association University (ETAU), ETA took the first step in establishing a comprehensive curriculum for the merchant acquiring business and laying the foundation for future development of industry certifications. Emphasis was also placed on ensuring adequate access to this education. This is being accomplished through delivery of ETAU courses at association meetings, individual corporate training sites, and the recently launched ETA Expo Networks that are targeted specifically at serving small ISOs and MLSs. Development of an online learning platform is also underway.

The process to build a legitimate and enduring certification program is substantive and requires support from the entire industry to help it succeed. Work will continue to build the base of knowledge and to determine the scope, need and parameters of industry certifications. In what ever form, ETA is committed to promulgating the highest and most effective business standards for the merchant acquiring industry, including the merchant level sales force that is integral to the success of the entire payments system.

With Regard to Relationships With and Proximity to the Card Associations

ETA strives to be the voice of the electronic payments industry. This includes having a productive relationship with the card companies, but also maintaining an independent voice that speaks on behalf of our constituents' needs. ETA accomplishes this in several ways.

The first is ensuring regular and open communication. Representatives of the four major cards have seats on the ETA Presidential Advisory Council. In this role, they are afforded insight and input into the most strategic issues facing our membership but cannot directly influence decisions on how these issues will be addressed by the association.

ETA's Industry Relations Committee is charged with further developing relationships with the card companies and Associations. It strives to engage company representatives around an action agenda based on ETA member needs and making sure that our voice is heard. This is long-term work but progress is being made. For example, earlier this year, the committee's leadership worked closely with Visa in its decision to temporarily waive third-party servicer fees.

Another way is to provide our members with ample access to information on activities by the card companies that affect our industry. A recent example is the participation of Lloyd Constantine as a keynote speaker at the 2004 Strategic Leadership and Networking Forum.

While the decision to invite Mr. Constantine, the chief litigator for the "Wal-Mart" case, was not a popular decision among all constituent groups, the leadership of the organization felt it was important to give our members the opportunity to hear how past and future antitrust litigation involving the card Associations may affect our business. As you can see, effective industry relations is a balancing act, based much more on relationship management, advocacy and communication than on physical location.

And regarding location, your survey also questioned ETA's move to Washington, D.C. The success of any organization is based on having quality leadership, excellent resources in ample supply, and access to the assets that will help it achieve its goals.

Washington provides a rich collection of these things to ETA. More non-profit associations are based in Washington than anywhere in the country thereby providing the greatest availability of association management professionals to serve as resources and staff to the organization.

This location also affords interaction with complementary trade and professional associations with which to build cooperative activities. And as the nation's capital, Washington provides access to the federal government to facilitate greater awareness of the industry and of the legislative and regulatory actions that affect it.

In an age where physical boundaries are eliminated through technology and a global environment, the things that continue to drive organizational effectiveness are strong communication, solid relationships, and a clear focus on mission.

ETA remains dedicated to these principles and to the industry it serves. Thank you very much for considering our response.

Carla Balakgie, CAE
Executive Director
Electronic Transactions Association