Thursday, September 11, 2008
The book, which was reviewed in The Green Sheet, July 14, 2008, issue 08:07:01, focuses on training merchants how to understand the principles and nuances of card not present credit card interchange fees.
The guide is designed to help merchants understand interchange fee structures and their financial consequences, providing merchants with a knowledge base for working with their payment processors in getting the best transactional fee results.
"It's more of an inference because we've seen an increase in sales across the board in a number of markets. Starting a few months ago, we all of a sudden started seeing a lot of sales to individuals from the northern Virginia, Maryland and Washington areas. The buyers rarely provided their company name," Shatz said.
The proposed antitrust law HR5546, The Credit Card Fair Fee Act, would relieve Visa Inc. and MasterCard Worldwide of their ability to mandate merchant interchange fees. HR5546 would require the card brands to negotiate those fees with merchants under the supervision of a three-judge panel from the Department of Justice.
Shatz noted that "the stakes are high, and supporters and opponents want to understand the constructs and mathematics behind interchange."
According to Shatz, three groups of people buy the book. Merchants have traditionally bought the book since its publication in April 2008 because it shows them how to reduce their interchange fees and improve profits. The second group is undefined, he said, and all seem to be from that one geographical area on the mid-eastern seaboard of the United States.
"They're sending me e-mails, asking specific questions with regard to interchange and HR5546, so I don't see how they can be from anywhere else but Capitol Hill," Shatz said. "I think the lobbyists [and other stakeholders on Capitol Hill] are buying it to understand the history and terminology, and what interchange looks like. I'd be surprised if they dove too heavily into the calculations.
"They certainly know about legislation but they don't always know the intricacies of the particular subject matter, and I hope this can be the perfect reference source. The third group, which I think is interesting, is payment industry participants like processors and ISOs. I believe The Green Sheet review is partially responsible for this," he added.
"I can tell specifically because those readers almost always provide their company name. Remember also that these players would also be affected by this legislation, and are also interested in a better understanding of the subject matter." Shatz noted that a dozen of the nation's largest processors are evaluating "Understanding Interchange" for future training purposes.
"For the newbies, this book can help them get an edge on the subject matter, and for those who already know what they're doing, the book will give those payment professionals a pretty solid mastery of interchange," Shatz said.
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