Serving select verticals, paying residuals long-term

When Mark Fravel founded National Transaction Corp. in 1997, his initial objective was to start a business that would allow him to stay at home and raise a family. Previously, as President of a First Data Corp. alliance bank unit before the unit was sold, global travel was integral to his job.

Coral Springs, Fla.-based NTC has since flourished. Two of Fravel's three daughters are involved with the company; the third is working in customer service during breaks from school and will likely join the company after college.

"Seventeen years later, they work for me," Fravel said. "They have a lot of input on everything we're doing, and they have their own portfolios, so they have all the flexibility of any other partners in a portfolio. There's no way they would ever let me sell it, nor would I want to."

Deep roots in travel

NTC stated its leads come from about 10 sources, and for the past decade, it has been the preferred credit card processing agent for a number of national travel agencies and associations. It works with such organization as the American Society of Travel Agencies and handles payment processing for travel agents, tour operators, limousine services, and other businesses related to the travel industry.

But risk in this market can be extremely high. "If the merchant is going to do $100,000 a month at a restaurant, the risk may be $2,000," Fravel said. "If the merchant is going to do $100,000 a month, and they're travel, it's a $500,000 risk. So the level of underwriting people that I deal with is a whole different group."

However, Fravel said hotel merchants are generally lower risk. He added that "because they have so many card types, our currency conversion platform is a perfect fit for the hotels. They're getting a lot of foreign transactions," and dynamic currency conversion can help minimize costs.

Medical transcription is another service NTC offers. "We have a transcription unit with 16 transcribers and editors," he said, noting that when a doctor's office submits a file at the end of the day, they have a paper or electronic file the very next morning. The company is also expanding into other areas of the medical field.

Poised for growth

According to Fravel, over the past two years NTC has invested heavily in infrastructure with the installation of fiber-optic and copper telecommunication lines, backup generators, redundant servers, purchase of a new building, and hiring the technical expertise to enhance all systems. This includes the redesign of NTC's commission system software for ISO and merchant level salesperson (MLS) partners, part of its readiness to grow its ISO channel.

"We've got the capacity to build," Fravel said. "We've been around long enough, and we now have the financial strength." Part of that strength stems from merchant retention. "When a merchant does switch over, they're typically back with us within 60 days … we're not putting anything down their throat," he added. "Our application has no termination, cancellation, return equipment or restocking fees."

According to Fravel, the company is built on delivering service and offering flexible ISO and MLS programs that are effective for the duration of the merchant's relationship with NTC. "I have a guy who five years ago stopped putting deals in to me, and today he's making 25 percent more than he did five years ago," Fravel said. Although adding new merchants is preferable, Fravel felt it was worth pointing out the gain in portfolio value five years after the agent's last deal.

"If you have any idea what the attrition numbers normally look like, his $30,000, take 10 percent away from that over a five-year period, he's left with $20,000," Fravel said. "With me he's making $40,000. He's making 100 percent more than he would have under ordinary circumstances. So my 50 percent deal is more like 100 percent. That's our magic, as I say."

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