In March 2013, CardCharge launched a patent-pending technology to help acquirers protect margins and tap previously inaccessible vertical markets. The CardCharge Calculator "preprocesses" transactions to identify processing costs to the merchant – acquirer's fees, interchange fees, processing costs – and upon approval charges customers directly before transactions enter the network. The company continues to pursue acquirer, processor and gateway partners to bring the technology to online and brick-and-mortar merchants nationwide.
Its technology evolved in response to the U.S. merchant class settlement with Visa Inc. and MasterCard Worldwide, which stipulated that merchants could surcharge credit card processing fees (debit cards are exempt) as long as they are compliant with certain provisions. Surcharging is now a viable option in 41 states.
CardCharge President Ed Levene said in states where surcharging is permitted more businesses are choosing to pass along transaction costs to customers. "Certain states have other additional rules, so you need to identify a whole litany of other criteria before the transaction occurs to get it right," Levene said. "You need to do a pre-process of that transaction, to go through the different activities."
The surcharge model has found a niche in regulated industries previously restricted from card acceptance, such as insurance and healthcare, where check payments are commonplace. Hypercompetitive industries where lower-priced products garner more sales have proven effective for this model as well.
"Let's say I sell $1,000 TV sets online, and supplier number two prices their TV at $970, 33 percent less," Levene said. "But if you pay with a card that costs them money, you pay the additional cost. So now, all of a sudden, we change the bidding structure for e-commerce." The same model can also be applied to booking hotel rooms and selling sandwiches at the local deli.
When a customer presents a payment card to a registered merchant, whether online or in-person, the CardCharge Calculator instantly takes the transaction subtotal, the card being presented and the merchant's preset characteristics and then proceeds through a series of steps to complete the transaction.
According to Levene, the company's system is agnostic, and to help navigate state and federal regulations concerning surcharge, CardCharge provides real-time processing that is both accurate and compliant.
Another advantage is the transparency it affords ISOs. "A merchant acquirer goes to a merchant, signs up the merchant, and agrees to a fee for that service, and then that would be embedded in the surcharge that goes to the consumer," Levene said, noting that acquirers typically expand revenues using this model.
"We see transaction values increase when we provide the no-cost program to merchants," he added. "We like to see approximately 100 basis points in the transaction to be shared among the groups from an average activity."
He also cited research indicating 68 percent of merchants surveyed across industry sectors said they would adopt a surcharge program if it meant they would no longer have to pay card acceptance fees and could instead transfer those costs to customers.
In Australia, one decade after the Reserve Bank removed the card schemes' no-surcharge rules under reforms set forth in 2003, the surcharge model has become well ingrained. From June 2013 to June 2014, the percentage of Australian merchants who surcharge rose from 39 percent to 43 percent, according to Sydney-based research firm East & Partners.
Notice to readers: These are archived articles. Contact names or information may be out of date. We regret any inconvenience.
ISO/MLS contact:
Ed Levene
President
203-857-9200
ed.levene@cardcharge.us.com
www.cardchargecalculator.com
Company Profile originally appeared in
The Green Sheet Issue 150101
231102 - Merchant Advisory Services Inc
231002 - Wellesley Hills Financial
181201 - Network Merchants LLC
180902 - MainStream Merchant Services Inc.
180801 - Century Business Solutions
180502 - Priority Payment Systems Northeast
180501 - Merchant e-Solutions Inc.
180301 - Wirecard North America
171202 - Secure Cryptopayments
171002 - National Benefit Programs LLC
170902 - Frates Insurance & Risk Management
170901 - DCS Holdings Group LLC
170802 - Apogee Payment Systems LLC
170702 - Active Software & Hardware Systems
170701 - Veratad Technologies LLC
170502 - Frontline Processing Corp.
170501 - Platinum Choice Bancard LLC
161202 - International Bancard Corp.
161201 - CSR Professional Services Inc
161102 - Digitzs Solutions Inc.
161101 - Residual Sheriff LLC.
160801 - DigiPay: Solutions Inc
160702 - CreditCardProcessing.com
151202 - Benseron Information Technologies Inc.
151201 - CardWare International Inc
151101 - Lion Capital Group LLC
150801 - Topcreditcardprocessors.com
150702 - Vision Payment Solutions LLC
150601 - Conformance Technologies
150502 - Global Processing Systems
150402 - Mercantile Processing Inc.
150401 - Field Guide Enterprises
150302 - Signature Card Services
150301 - Premier Payment Systems Inc.
150201 - Humboldt Merchant Services
141102 - National Merchants Association
141001 - Instant Credit Manager
140902 - Merchant Cash and Capital LLC
140701 - National Transaction Corporation (NTC)
140601 - Total Merchant Services
140501 - Nationwide Payment Solutions
140501 - BPC Banking Technologies
140301 - Meritus Payment Solutions
131202 - First American Payment Systems L.P.
131102 - Evo Payments International LLC
131001 - Live Reps Call Center
130901 - Regal Payment Systems LLC
130901 - The Merchant Solutions
130802 - North American Bancard LLC
130801 - Payment Logistics LLC
130702 - Plug n Pay Technologies Inc.
130601 - U.S. Merchant Systems LLC
130402 - National Processing Co.
130202 - Charge Card Systems Inc.
130202 - Layered Technologies Inc.
121202 - American Microloan LLC
121102 - Keep in Touch Systems Inc.
121102 - Merchants Choice Payment Solutions
121002 - Washington Bancard Merchant Services LLC
120902 - Central Payment Co. LLC
120802 - Royal Merchant Holdings LLC
120801 - National Benefit Programs LLC
120602 - Cardinal Commerce Corp.
120601 - Veritrans Merchant Services LLC
120502 - ExecuTech Lease Group
120502 - The Small Business Authority
120402 - Chargeback Guardian Inc.
120401 - Electronic Payment Exchange
120301 - Complete Merchant Solutions LLC
120201 - CSR - Compliance Solutions and Resources
111002 - Lead Source Call Center
111001 - First Annapolis Consulting Inc.
110902 - Point of Sale System Services Inc.
110901 - Sage Payment Solutions
110801 - Century Payments Inc.
110702 - Creative Vision Studio LLC
110702 - Network Merchants Inc.
110701 - Capital Access Network Inc.
110602 - eProcessing Network LLC
110602 - Moneris Solutions Inc.
110502 - Paragon Application Systems Inc.
110401 - Merchant Implementation Services
101202 - CheckAlt Payment Solutions
101102 - Impact Payments Recruiting
101101 - Global Electronic Technology Inc.
101002 - TriSource Solutions LLC
100802 - Federated Payment Systems LLC
100801 - Voltage Security Inc.
100601 - NETSURION (formerly Vendor Safe Technologies)
100502 - Transaction Network Services Inc.
100402 - Secure Payment Systems Inc.
100401 - Elite Merchant Solutions
100302 - Retail Decisions Inc.
091201 - Performance Training Systems Bankcard Boot Camp
091101 - Merchant e-Solutions Inc.
091002 - Whitehall Capital Advisors LLC
090901 - CoCard Marketing Group LLC
090801 - First National Merchant Solutions
090701 - checXchange Money Transfer Systems Inc.
090601 - Sterling Payment Technologies
090502 - Infinity Payment Systems
090501 - Merchant Cash and Capital
090401 - UseMyBank Services Inc.
090401 - Data Delivery Services Inc.
090302 - Velocity Merchant Services
090302 - Metro Merchant Services
090301 - Smart Transaction Systems Inc.
090301 - DCC Merchant Services USA LLC
090202 - TransFirst Holdings Inc.
081202 - Affirmative Technologies Inc.
081201 - On-line Strategies Inc.
081101 - Vision Payment Solutions LLC
081002 - Veratad Technologies LLC
081001 - International Merchant Solutions LLC
080801 - GreenSoft Solutions Inc.
080702 - Smart Circle International
080601 - International Bancard Corp.
080502 - DRG Telemarketing Inc.
080501 - BCC Merchant Solutions
080402 - U.S. Merchant Systems
080401 - Greystone Business Resources Corp.
080302 - Transmedia Payment Services Ltd.
071202 - Barclay Square Leasing Inc.
071102 - FirstView Financial LLC
071001 - Sage Payment Solutions
070902 - YourTownMall Business
070901 - Nxgen Payment Services
070802 - All card Processing-AAMonte-USA
070801 - Money Movers of America Inc.
070602 - Central Point Resources Inc.
070601 - Positive Feedback Software LLC
070502 - Premier Payment Systems
070501 - Amacai Information Corp.