Page 47 - GS181102

Education

stigma associated with a preference While ISOs often sell merchants on the cost reduction that comes with passing
for cash (often associated with tax on credit fees, compliance is perhaps even more important to long-term retention
avoidance) and clearly communicate and value creation. ISOs who want to ensure they retain their hard-won clients
their motivation: avoiding the high should take a careful look at the solutions they're selling and partner with a
cost of subsidizing consumers' access provider who puts compliance first.
to credit, rewards and miles.

Finally, customers benefit from hav- Evan Weese is the marketing lead for CardX, a Chicago-based technology company that provides
ing an option to pay with plastic at credit card acceptance solutions to businesses, government and education. He can be reached at
no additional cost. The transparent evan@cardx.com.
fee communication and the "no fee"
debit option ensure customers un-
derstand that, when charged a credit
card fee, they're only paying the
costs created by their chosen form of
payment. The signage requirements
also ensure the customers are never
surprised by surcharges and under-
stand the fees are not a profit center
for the merchant, but rather intended
only to cover their costs.

Surcharging opens intriguing pos-
sibilities for ISOs and merchants to
reduce costs not only for retail pay-
ments, where cash is a viable alter-
native, but also for online or MO/TO
payments where cash or check pay-
ments are less feasible. Many ISOs
previously confined to the retail en-
vironment with a "cash discount" of-
fering will benefit considerably from
offering surcharging solutions for
ecommerce and MO/TO payments,
providing the merchant with a con-
sistent solution across all platforms.
How to start surcharging

As surcharging has gained momen-
tum in the American market, it has
become clear that neither ISOs nor
merchants should view the sur-
charge rules as a checklist for them
to manually complete on their own.
Full compliance requires comprehen-
sive understanding of the rules and
surcharge-specific technology (for
example, the ability to automatically
distinguish between credit and debit
in real time before authorization).
ISOs and merchant benefit from rely-
ing on the expertise of a turnkey pro-
vider of surcharging solutions.

Perhaps the most important lesson
from the Visa bulletin is that the
rules are complex, and increasing
merchant adoption will lead to
stricter enforcement of the rules.

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