The Green Sheet Online Edition
June 22, 2009 • Issue 09:06:02
Processing in a matrix
Businesses whose operations are wide-ranging or multiform can generate balance sheets that befuddle their reader. Often, such merchants are best-served by multiple bank accounts - both to compartmentalize their figures as well as limit fees and surcharges.
Yet, in the online universe each gateway (the personal portals with logins and passwords from which the Internet's channels are operated) traditionally supports only a single bank account - meaning merchants
with multiple accounts must establish a new gateway for each one, making it very difficult to do anything like wholesale accounting.
A new software program from Internet payment processing company Ezic Inc. - called Multiple Merchant Account Matrix - supports an unlimited number of bank accounts within one gateway, routing transactions to different accounts based on a particular merchant's established criteria.
"Anyone can use it," said Kara Blindauer, Marketing Manager for Ezic. "It could be one business owner with multiple storefronts, locations or just different departments. A lot of people like to use the Multiple Merchant [Account] Matrix just for accounting purposes - they like to separate their money so they know which money goes to which account, rather than having to separate them later on."
Many routing options
Blindauer said the program is generally used to either simplify a business's accounting or limit bank fees. She said the program enables merchants to limit their transaction fees by shopping around for banks that offer the best rates on a variety of different transactions.
For example, she said, a merchant could have separate accounts for Visa Inc., MasterCard Worldwide and Discover Financial Services transactions in which each account offers the best interchange rate for the card it handles - whereas a single account might provide the best rates on Visa transactions but less-than-desirable rates on MasterCard.
For the same reason, a merchant might choose to establish separate accounts for card-present and card-not-present transactions.
"You can choose different criteria," she said. "If you want to do it by card issuer, if you want to do it by account type, sales, refunds - you can manage any of this in the Matrix."
Merchants could do the same thing by opening up multiple gateways, but that option is more expensive and less efficient, according to Blindauer.
"You'd have to pay all the gateway fees associated with it, and you would have to have a whole separate login [for each account], so it would take more time," she said. "And your finances and reporting wouldn't be together. It would all be in separate accounts where if you wanted to do the cumulative report of every account, you couldn't do that under one gateway."
Carry it over, avoid declines
Among the other features of Multiple Merchant Account Matrix is a "cascading" tool: If a transaction is declined on one account, it automatically defaults to a secondary account; a "fallback" feature activates with which accounts processed during a bank's downtime are likewise transferred to another processor.
"If a bank has downtime and there's no way to process a transaction, it will fall back to the next eligible account, so that transaction won't be lost, and it will do this seamlessly and within seconds," Blindauer said.
The program also includes a "load balancing" feature that redirects a transaction when it would encroach on a bank's processing limit - which can also result in a decline.
Blindauer said users of the Matrix are generally "medium to large" merchants who typically use anywhere from two to 20 different bank accounts.
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