Product: Portfolio Purchases
Company: Cutter LLC
Cutter LLC, a leading purchaser of merchant portfolios and recurring revenue streams, has endeavored to earn trust through seamless account transitions – from initial due diligence to completed acquisition – since its inception in 2006. Cutter has also established deep relationships with its diverse channel partners, which include major ISOs and processors, independent software vendors, third-party service providers and merchant level salespeople (MLSs) throughout the United States and Canada.
Denise Shomo, president at Cutter, has recently seen a spike in partial portfolio sales in response to the global coronavirus pandemic, which has shuttered millions of businesses and impacted residual streams. She pointed out that a partial portfolio sale can help MLSs and ISOs improve cash flow without sacrificing an entire book of business.
"Residuals are a valuable asset," Shomo said. "Most agreements allow for an option to sell to their ISO or a third-party service provider like Cutter. We work with all types of recurring revenue streams in the payments industry and offer personalized service for accounts that are purchased and subsequently incorporated into the Cutter organization."
Shomo further noted that service providers can decide how to manage merchant relationships post-sale. They may choose to keep relationships intact as valuable partners and referral sources. Shomo detailed the following are additional benefits of selling part, but not all, of a book of business:
Instead of telling clients their merchant accounts have been sold when transitioning part of a portfolio, Shomo advises saying that you have grown your business to include a vetted third-party service provider to provide them with quick and immediate access to VIP support.
"Everyone in the payments industry is expecting residuals to decline for most business types that have been deemed non-essential and are temporarily closed," Shomo said. "Despite lower multiples and unique terms during these difficult times, it's good to know that this is an option."
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