The Green Sheet Online Edition

April 27, 2020 • Issue 20:04:02

New Products

Stay connected after the sale with VIP merchant support

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."

Retain valued relationships

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:

• Customized service options: Merchant relationships can remain intact and jointly serviced by original MLSs, ISOs or service providers, with Cutter providing support in the background.
• Choice on how much to sell: Participants can sell a portion of their residual streams for flexible terms and without minimums.
• Flexible residual payouts: When the impact to residuals evens out or starts to return to normal volumes, the excess residual amount of the unsold portion will be paid to the agent/ISO.
• Business continuity: Selling a portion of the residual creates an immediate cash infusion without depleting all cash flow, so MLSs and ISOs can continue operations.
• Relationship continuity: Agents and ISO's can remain in contact with merchants and still get the financial advantage of selling part of a book of business. Processing continuity: Merchants rarely know and are never told when their accounts are sold. Retention specialists mitigate attrition and merchant accounts are not converted or sold.
• Inclusive deal parameters: Cutter will purchase deals too large or too small for other firms to consider.

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."

Website: www.cutterfinancial.com Contact: acquisitions@cutterfinancial.com

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