entral Bancard LLC is an Iowa-based payment processing company founded on solid experience and good business values; it's also the result of a friendship between two veterans of the industry.

Bill Brockway, Central Bancard's President and Co-owner, founded the company in 2003. Brockway had previously served as Executive Vice President and Chief Operating Officer of Quad City Bancard Inc. from 1994 to 2002. He is also one of the founders of Nobel Electronic Transfer LLC.

Henry Harp, Central Bancard's Executive Vice President and Co-owner, was Executive Vice President of Vital Processing Services; Harp had been with Vital since its inception. He also served as Vice President for TSYS prior to the formation of Vital.

Combined, Brockway and Harp have more than 48 years' experience in the merchant acquiring and credit card processing industries. Throughout their careers, they had many of the same customers in common.

They finally met more than 10 years ago at an industry convention, and together built a very successful company in a short period of time.

"We have the experience of a large, established organization, but we offer the service of a small company to make every agent and ISO know that their needs are important and their opinions are valued," Harp said.

"Our main focus is to develop a comprehensive suite of products and services geared toward the agent's success in the industry. We pride ourselves on the warm, friendly service that we offer and are always willing to help an agent develop a plan to suit that agent's needs."

"They have a nice program and run an honest, good business," said Harry Hasselmann, Executive Vice President and General Counsel of Vital Processing Services. "Both [Harp and Brockway] have so much experience; they've been in the business a long time. I've known Harp for more than 10 years, and he's always looking for ways to help his customers."

Through the ISO and merchant level salesperson (MLS) sales channel, Central Bancard offers merchants credit and debit card processing; check and e-check services; electronic benefits transfer (EBT); gift card programs; Internet and wireless solutions; pay by phone services; and POS equipment and support.

The company's target customers include retail merchants in the card-present, mail order/telephone order and online environments.

"TrustCommerce has enjoyed a longstanding business relationship with Central Bancard," said Rob Caulfield, Chief Executive Officer of TrustCommerce, a provider of solutions for a variety of commerce enterprises based on Open Source programming. "Our mutual customers have benefited tremendously from this association and we are proud to recommend their services to merchants."

Advantages of Back-end Processing

Central Bancard has its own back-end clearing and settlement platform, which allows it to offer customized reporting and billing solutions to merchants and ISOs/MLSs.

"We use Vital Processing Services as our front-end authorization provider, but we also have our own in-house back-end processing platform," Harp said. "This allows us to customize our offerings, to be more nimble as far as making changes and reacting quickly to the market."

"Not all processing centers in the country have that capability," Brockway said.

Growing Quickly

In 2004, Central Bancard achieved significant growth. Its processing volume for the year increased 935% over 2003, with more than $112 million in December 2004 processing volume alone. Harp said the company is on track to process more than $2 billion in 2005, just 18 months after signing its first agent. He attributes Central Bancard's growth to the way in which the two partners run the business. "I firmly believe it's who we are; both Bill and I have been in this industry a long time," he said. "And we have built good reputations in this business. We always try to do the right thing. We're not doing anything to make a quick buck or to skim some from somebody else. We want everyone to win."

To further drive growth in processing volume in 2005, Central Bancard introduced three new programs: a merchant funding program, a quick service restaurant (QSR)/small ticket program and a check card rate program.

Funding Merchants

With Central Bancard's merchant funding, or financing, program, the company helps merchants generate cash, whether for remodeling, advertising or investing in capital such as new equipment, by purchasing a portion of their future credit card sales at a discount.

Central Bancard bases the amount of financing on merchants' historical credit card volume. Usually, the amount is up to 70% of their average monthly Visa and MasterCard transactions. The company withholds a percentage of the merchant's daily deposit total, typically about 15%, for repayment of the pre-funded credit cards sales.

"Merchant funding is something our agents were talking about, so we went out in search of a program to provide to them," Harp said. "It really came about because of merchant requests."

Winning QSRs and Small-ticket Merchants

The QSR/small ticket program enables Central Bancard's ISOs and agents to woo merchants with low-ticket volumes such as fast food restaurants, video and DVD rental stores, movie theaters, parking lots and garages. "They all fall under the same QSR program," Brockway said.

"There's still not a lot of competition in the QSR arena," Harp said. "Other than the big chains like McDonald's and Burger King, if you go to a more regional or local QSR, you seldom see card usage at these types of locations."

Visa transactions must be less than $15 and MasterCard's must be less than $25; the transaction must occur in a face-to-face environment and the card is present and swiped at the point of sale. Central Bancard uses its back-end clearing and settlement platform to qualify the transactions at the special rates and categories.

"We have the technology and capabilities to support all of those interchange rates and programs, and our pricing structure is one that we felt like we could create an offering that would be very well received in the QSR market," Harp said.

Separating Check From Credit

Through its new check card discount pricing program, the company enables its ISOs/MLSs to offer separate qualified discount pricing for check cards. "Most merchants are still paying one qualified discount rate for credit and check transactions," Harp said.

With Central Bancard's program, ISOs/MLSs offer one qualified discount rate for check card transactions and a different qualified discount rate for credit card transactions, saving merchants up to 50 basis points on their check volume for retail merchants.

Again, using its proprietary back-end clearing and settlement system, the company can calculate the lower interchange rates and will pass these on to its ISO/MLS partners, with no mark up and no increases on mid- and non-qualified transactions. Central Bancard serves the small- to mid-sized merchant market. And an affiliate company, also owned by Brockway and Harp, TriSource Solutions LLC, provides full processing services to other ISOs without their own BIN relationships.

TriSource can provide Vital Processing front-end authorization products; an in-house back-end clearing and settlement solution; BIN access; customer service; risk monitoring; underwriting and marketing services to ISOs that are looking for a partner that will allow them to grow the value in their own business (not in their processing partner's) through merchant ownership.

Paying Its Partners

Central Bancard has developed a customized compensation program to serve its ISO/MLS partners. The company offers buy rates, true interchange pass through, one day turnaround on merchant applications with no fees and contractually guaranteed lifetime residuals.

It also offers detailed reporting for agents to analyze their merchant accounts.

"We pay our agents the same way each month, just as agreed, with nothing hidden and no fine print," Harp said. "Just simple and straightforward."

In an industry where so many companies offer the same products and services and at competitive rates, it's hard to differentiate one from the others. "Everybody says they have great prices, lifetime residuals and turn merchant applications around in one day; of course you can get that almost anywhere," Harp said.

"We focus more on our culture, the way we do things here, which is what I think separates us, and the fact that we have our own back-end platform and all the value that that brings, too. We will maintain the reputations that we have established within this industry because we have built and operate Central Bancard and TriSource on hard work, honesty, mutual respect for our clients and a commitment to do the right thing, just the way Bill and I have always conducted ourselves in this industry," Harp said.

Brockway and Harp work together and share a similar approach to doing business, but actually work out of different offices. "I'm responsible for more of the day-to-day operations, while Henry brings in new business," Brockway said.

"I find it; he takes care of it," Harp joked.

"We're on the phone about 20 times a day to each other," Brockway said. "I think we need one of those video phones."