ayment processing is definitely a growth business. The industry accounts for two of the top 10 fastest-growing companies in Inc.'s 2006 ranking of 500 private companies. Litle & Co. and United Bank Card Inc. placed Nos. 1 and 6, respectively.

Litle & Co., a third-party processor, services direct marketers. It outranked all other private companies by achieving 5,629% growth in the past three years, Inc. reported.

The top ranking was unexpected. "We knew we were doing pretty well, but No. 1 came as a surprise," Chairman Tim Litle told The Green Sheet. He estimated revenue for 2006 will double last year's figure of $34.8 million.

Litle was hardly a newbie to payment processing when he began the fledgling company in 2001. He had founded and sold to First USA two earlier companies. Those businesses, like his current operation, focused on card-not-present clients and processing. He estimated the systems he developed make up about a quarter of what is now known as Chase Paymentech. More than half of Litle's current clients are Internet marketers.

The key to growth has been thorough knowledge in four areas: software systems development, the company's market, card Association regulations and risk management, Inc. quoted him as saying.

Litle's son Tom, President and Chief Executive Officer, runs the Lowell, Mass.-based company, which has 38 employees.

Striving to build the perfect payment-processing system, the company invests far less on computer hardware than in the old days. Software sophistication is now the key, Tim Litle suggested. Litle & Co. has built a state-of-the-art processing engine from the ground up. "We're a very efficient processor, from a computer systems point of view," he said. The system was built in Java programming language on a Linux operating system.

UBC jumps ahead 13 spots

United Bank Card moved to No. 6 from No. 19 in Inc.'s ranking in the space of a year. The magazine ascribed UBC's growth of 3,845% in three years to its decision to begin a free-terminal program. The company earned $53.4 million in revenue last year. A registered ISO of First National Bank of Omaha, UBC caters to the full breadth of merchant categories, with about 70% being brick-and-mortar businesses. E-commerce is a growing segment.

Begun by CEO Jared Isaacman in his parents' home in 1999, UBC experienced growing pains in 2003. It was acquiring about 800 new merchants a month - more accounts than it could support, Isaacman said in an April 2006 presentation to attendees of the Electronic Transactions Association's Annual Meeting & Expo. The solution was to expand operations to Tucson, Ariz.

In late 2004, the company also moved into ATM sales and support services. By January of 2005, the sales force was bringing in 2,400 merchant contracts per month. The company sustained its equipment program, and its growth rate, by selling a portion of its portfolio for $44 million. UBC, based in Hampton, N.J., now has 134 employees.

The Inc. 500 list is in its 25th year. Inc. published the entire 2006 list in its September issue; the top 25 are online at www.inc.com/resources/inc500/2006