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The Green SheetGreen Sheet

The Green Sheet Online Edition

February 25, 2013 • Issue 13:02:02

Readers Speak

Be careful with your marketing materials

I just have a basic question, but I have gotten a difference of opinion, and I was told that your site was the most trusted source of information for ISOs. I hope you can give me a couple basic answers. I am going to be starting an ISO, no registration with any bank or anything, just obviously partnering with a direct ISO. But I want to build my own personal brand, so I am going to have a website and business cards for myself. I'd like an umbrella application with my logo on it as well, ideally.

Is it OK for me to have cards alluding to payment processing (naturally) and a website and even a blanket app with no bank name, without any repercussions from any organization - card company or otherwise? Are we just not allowed to put any of the card companies on anything? That's what most people have said, to just not list any card company. I would really like a definitive answer on this, and if there is a problem, what might the solution be?

Hugh Haun
Merchant Level Salesperson


Thank you for your question. We have published articles on this topic in the past but haven't addressed it recently, so it's good to revisit the topic. One helpful article is "Marketing in compliance," By Nancy Drexler, The Green Sheet, April 28, 2008, issue 08:04:02. Following is a condensed excerpt that speaks to your concerns:

In the eyes of the card brands, if you are not registered with them, you are not truly an ISO. Therefore, you are not authorized to sell credit or debit card processing services. Registered ISOs are required by the card brands to carry their bank branding on marketing materials from websites to business cards to e-mail addresses. Processing banks stipulate exactly how their individual bank brands should be communicated.

The branding requirements have three components:

  • A declaration stating the ISO is registered
  • Inclusion of the bank's name
  • Inclusion of the bank's city and state name

Remember, these are the rules set by the card brands. The banks then stipulate exactly how their names should be used.

Many nonregistered ISOs mistakenly believe they can use their own business names as long as they do not use them in conjunction with the Visa or MasterCard logos. This is not true. If unregistered ISOs use their own business names when talking about rates or fees, giving out their business cards, handing out brochures, or giving applications to merchants to solicit card processing, they are conducting business out of compliance. Even e-mail addresses require compliance.

The card brands are doing spot checks. They randomly call offices, visit websites and have secret merchants (much like secret shoppers) request contracts or solicitations. Additionally, unhappy merchants often call the card companies to complain. This makes it pretty easy to identify offending ISOs and MLSs.

The card brands require their sponsor banks to enforce the rules as they apply to compliant marketing. The banks require their registered ISOs to do the same. ... Historically, the card brands would call the sponsor banks first and strongly urge them to get their ISOs and MLSs into compliance. More recently, they have gone directly to violators who, if lucky, get a stern warning. If not so lucky, or if this is not the first notification, it is likely violators are fined. Then the card brands give a heads up to the bank.

If an unregistered ISO or MLS is found to be conducting business out of compliance, the sponsor bank will be found in violation and subject to disciplinary action. Fines set by the card brands start at $25,000 for the first offense and can go up to six figures.

If a bank is fined by Visa or MasterCard, it is fairly certain the damage will be passed along to the registered ISO. And get this: The amount of the fine depends on how many times the bank has been found in violation. Even if this is the first violation for the ISO or MLS, the amount of the fine could be higher if it was not the first time the bank has been noncompliant.

We checked in with Nancy Drexler at Acquired Marketing to see if she had thoughts to add. She said, "Merchants are becoming more aware and more educated. A bank brand on a website or sales brochure lends immediate credibility to the company, as well as protecting it from any risk of noncompliance.

"There has been some discussion as to whether the bank brand is required on materials that do not mention payments or, more specifically, do not mention Visa or MasterCard. But why risk it? Affiliation with a bank is only a plus."


end of article

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