Merchant Services
IT'S A JUNGLE OUT THERE!
DO NOT CHANGE YOUR SERVICE PROVIDER UNTIL YOU KNOW EXACTLY HOW AND WHEN TO TERMINATE YOUR EXISTING CONTRACT.
The payment card industry is like the wild west. The contracts that businesses have signed over the last few years have been onerous to say the least.
Before you consider making any changes to your merchant status or consider changing your merchant provider, It is important that you check your contractual and termination obligations first.
Do not assume that because you have served the agreed term of your contract, you are free to enter an agreement elsewhere.
There are many clauses around termination that if you do not adhere to, can cost hundreds of pounds in termination fees.
WHAT IS THE PCI DSS CHARGE ON MY BILL?
The Payment Card Industry Data Security Standard (PCI DSS) is an information security standard for organisations that handle branded credit cards from the major card schemes.
It will appear in your bill. If you are compliant there will be a £5 – £10 charge for compliance.
Should you not be compliant, the bank will apply changes to your bill every month.
If your total transaction value for the month is less than £6000 – £7000, you will see a charge between £25 – £60 appear on the bill.
If you spend more, it may well be a percentage of your monthly transactions and this can run into many hundreds of pound.
It only takes 20 minutes once a year for you to be compliant. If you need help, do not hesitate to ask.
This means, if you don’t spend thirty minutes every year, your monthly charges for having a merchant facility will go up considerably.
Banks like to make money. They make more money if you are not compliant. Do not expect a great deal of help with compliance issues.
WHY DO I NEED TO BE PCI DSS COMPLIANT?
PCI DSS stands for payment card industry data security standards. It will appear on your bill whether you are compliant or you’re not.
If you are compliant, there will be a management charge levied by your supplier. It should be between £5 and £10 a month.
WHAT HAPPENS IF I AM NOT COMPLIANT?
Every year, you are asked as a merchant to complete a compliance check. If you forget to complete the test, you will be deemed by the bank to be non-compliant. If you cannot answer the questionnaire satisfactorily, you will be deemed to be non-compliant.
We believe that the bank would rather that you are non compliant based on the amount of money that they charge for non compliance issues.
If you are non-compliant and have a low amount of transactions going through your terminals, normally less than seven thousand a month, your provider will fine you between £20 and £75 for being non-compliant.
If your transactions exceed £10,000 per month, you will probably be charged a percentage of your total monthly transaction value. This can add hundreds of pounds to your monthly charges.
This means, you must take the time every year to pass the compliance audit to make sure that your monthly charges do not go up.
HOW DO I BECOME PCI DSS COMPLIANT?
You will need to pass an online or verbal compliance audit every year. You will be able to get these details from your terminal or gateway provider.
Your bank makes more money if you are not compliant. Do not expect much help.
We have worked with Louise for many years. We have only ever been able to look after her energy because before we came on the scene, Louise was signed into long term agreements for her other services.
Even though these supplies and service are with other providers, we still help Louise manage these contracts.
She has two fixed terminals in her shop, a payment gateway on her website and a fixed terminal in her office.
Last year she noticed that she had an extra charge on her bill. Her PCI DSS charge had changed from a management charge to a non-compliance charge.
The old charge was £4.99 the new non-compliance charge was £136.12.
Because Louise had not passed her annual audit, her charges had increased by £131 per month.
Unfortunately, when the bank ran their checks, she was not able to pass the audit.
Unbeknown to her, her telecom provider had opened some ports on her router to gain access to her system. This rendered her non-compliant.
After many frustrating hours on the phone with the bank, Louise contacted us. We were able to advise her telecom company how to access her telephone system more securely and advise her how to pass her PCI DSS compliance audit.
<!–
Last year she noticed that she had a charge of £12.00 charge for PCI DSS to a .35 5% non compliance charge.
In her case this meant an additional monthly charge of £12.00.
Louise did exactly the right thing, she called her bank to try and become compliant again.
However she was unable to pass the compliance test. Unbeknown to her, the telephone company had opened ports on her router to help manage her telephone system without her knowledge.
These open ports meant that she was now non-compliant.
–>
WHO IS MY AGREEMENT WITH?
When you have a merchant terminal or gateway, you enter into two agreements.
One is with the bank, this is typically a thirty-day rolling agreement.
One is with the terminal or gateway provider, this is typically for a longer period of 24 months to 48 months and this is the part where you need to be careful.
This means that if you want to change providers, you must check with your merchant provider how to leave their contract without incurring costs.
You will not be able to use your terminal with another bank should you decide to change acquiring bank.
One of our customers is a butcher, we look after all of their utilities.
However, we do not provide them with their payment terminals yet and for very good reason.
When we approached them about their merchant terminals, the owner leant down to his right, opened a drawer and inside sat two new shiny payment terminals.
He had been duped by two different salesmen into believing that he was free to leave his current provider and take advantage of lower transaction fees because he was, they said, in a thirty-day rolling agreement with the bank.
Both salesmen proved to him that this was the case by contacting the bank and asking them in front of him.
In both instances, he took the salesman at face value and got stung.
Although he was in a thirty-day rolling agreement with the acquiring bank, he had signed a three-year service agreement with one terminal provider and a four year with another.
All this meant that he had two very expensive paperweights in his desk draw.
Unfortunately, both contracts were watertight and neither provider were prepared to release him from his obligation to pay.
Obviously, we have not provided him with another terminal.
What we were able to do was, negotiate lower transaction charges with the bank and merchant provider that he was actually using to mitigate some cost.
I think that we have also convinced him not to sign anything without speaking to us.
HOW LONG SHOULD IT TAKE FOR MONEYS TO HIT MY ACCOUNT FROM THE POINT THAT I TAKE A PAYMENT FROM A CUSTOMER BY CREDIT / DEBIT CARD?
The standard across most banks is four working days from the day that a transaction is completed on the terminal.
A card transaction is not as simple as it appears. The money does not come direct from your customers account to yours.
There are four entities involved in every transaction. The merchant, that’s you, the customer, the scheme, that’s the card I.e. Visa and the acquiring bank, these are the people that bill you the merchant for the terminal and these transactions.
There are several movements between these entities and so the average is four days.
This means that if you have not had a terminal before you will have a four day cash flow issue.
There are some agreements that charge a premium for next day payments to the merchant. Beware, they are expensive.
Remember, after your initial four day wait, a payment will hit your bank every day.
DO NOT CHANGE YOUR SERVICE PROVIDER UNTIL YOU KNOW EXACTLY HOW AND WHEN TO TERMINATE YOUR EXISTING CONTRACT.
The payment card industry is like the wild west. The contracts that businesses have signed over the last few years have been onerous to say the least.
Before you consider making any changes to your merchant status or consider changing your merchant provider, It is important that you check your contractual and termination obligations first.
Do not assume that because you have served the agreed term of your contract, you are free to enter an agreement elsewhere.
There are many clauses around termination that if you do not adhere to, can cost hundreds of pounds in termination fees.
WHAT IS THE PCI DSS CHARGE ON MY BILL?
The Payment Card Industry Data Security Standard (PCI DSS) is an information security standard for organisations that handle branded credit cards from the major card schemes.
It will appear in your bill. If you are compliant there will be a £5 – £10 charge for compliance.
Should you not be compliant, the bank will apply changes to your bill every month.
If your total transaction value for the month is less than £6000 – £7000, you will see a charge between £25 – £60 appear on the bill.
If you spend more, it may well be a percentage of your monthly transactions and this can run into many hundreds of pound.
It only takes 20 minutes once a year for you to be compliant. If you need help, do not hesitate to ask.
This means, if you don’t spend thirty minutes every year, your monthly charges for having a merchant facility will go up considerably.
Banks like to make money. They make more money if you are not compliant. Do not expect a great deal of help with compliance issues.
WHY DO I NEED TO BE PCI DSS COMPLIANT?
PCI DSS stands for payment card industry data security standards. It will appear on your bill whether you are compliant or you’re not.
If you are compliant, there will be a management charge levied by your supplier. It should be between £5 and £10 a month.
WHAT HAPPENS IF I AM NOT COMPLIANT?
Every year, you are asked as a merchant to complete a compliance check. If you forget to complete the test, you will be deemed by the bank to be non-compliant. If you cannot answer the questionnaire satisfactorily, you will be deemed to be non-compliant.
We believe that the bank would rather that you are non compliant based on the amount of money that they charge for non compliance issues.
If you are non-compliant and have a low amount of transactions going through your terminals, normally less than seven thousand a month, your provider will fine you between £20 and £75 for being non-compliant.
If your transactions exceed £10,000 per month, you will probably be charged a percentage of your total monthly transaction value. This can add hundreds of pounds to your monthly charges.
This means, you must take the time every year to pass the compliance audit to make sure that your monthly charges do not go up.
HOW DO I BECOME PCI DSS COMPLIANT?
You will need to pass an online or verbal compliance audit every year. You will be able to get these details from your terminal or gateway provider.
Your bank makes more money if you are not compliant. Do not expect much help.
We have worked with Louise for many years. We have only ever been able to look after her energy because before we came on the scene, Louise was signed into long term agreements for her other services.
Even though these supplies and service are with other providers, we still help Louise manage these contracts.
She has two fixed terminals in her shop, a payment gateway on her website and a fixed terminal in her office.
Last year she noticed that she had an extra charge on her bill. Her PCI DSS charge had changed from a management charge to a non-compliance charge.
The old charge was £4.99 the new non-compliance charge was £136.12.
Because Louise had not passed her annual audit, her charges had increased by £131 per month.
Unfortunately, when the bank ran their checks, she was not able to pass the audit.
Unbeknown to her, her telecom provider had opened some ports on her router to gain access to her system. This rendered her non-compliant.
After many frustrating hours on the phone with the bank, Louise contacted us. We were able to advise her telecom company how to access her telephone system more securely and advise her how to pass her PCI DSS compliance audit.
<!–
Last year she noticed that she had a charge of £12.00 charge for PCI DSS to a .35 5% non compliance charge.
In her case this meant an additional monthly charge of £12.00.
Louise did exactly the right thing, she called her bank to try and become compliant again.
However she was unable to pass the compliance test. Unbeknown to her, the telephone company had opened ports on her router to help manage her telephone system without her knowledge.
These open ports meant that she was now non-compliant.
–>
WHO IS MY AGREEMENT WITH?
When you have a merchant terminal or gateway, you enter into two agreements.
One is with the bank, this is typically a thirty-day rolling agreement.
One is with the terminal or gateway provider, this is typically for a longer period of 24 months to 48 months and this is the part where you need to be careful.
This means that if you want to change providers, you must check with your merchant provider how to leave their contract without incurring costs.
You will not be able to use your terminal with another bank should you decide to change acquiring bank.
One of our customers is a butcher, we look after all of their utilities.
However, we do not provide them with their payment terminals yet and for very good reason.
When we approached them about their merchant terminals, the owner leant down to his right, opened a drawer and inside sat two new shiny payment terminals.
He had been duped by two different salesmen into believing that he was free to leave his current provider and take advantage of lower transaction fees because he was, they said, in a thirty-day rolling agreement with the bank.
Both salesmen proved to him that this was the case by contacting the bank and asking them in front of him.
In both instances, he took the salesman at face value and got stung.
Although he was in a thirty-day rolling agreement with the acquiring bank, he had signed a three-year service agreement with one terminal provider and a four year with another.
All this meant that he had two very expensive paperweights in his desk draw.
Unfortunately, both contracts were watertight and neither provider were prepared to release him from his obligation to pay.
Obviously, we have not provided him with another terminal.
What we were able to do was, negotiate lower transaction charges with the bank and merchant provider that he was actually using to mitigate some cost.
I think that we have also convinced him not to sign anything without speaking to us.
HOW LONG SHOULD IT TAKE FOR MONEYS TO HIT MY ACCOUNT FROM THE POINT THAT I TAKE A PAYMENT FROM A CUSTOMER BY CREDIT / DEBIT CARD?
The standard across most banks is four working days from the day that a transaction is completed on the terminal.
A card transaction is not as simple as it appears. The money does not come direct from your customers account to yours.
There are four entities involved in every transaction. The merchant, that’s you, the customer, the scheme, that’s the card I.e. Visa and the acquiring bank, these are the people that bill you the merchant for the terminal and these transactions.
There are several movements between these entities and so the average is four days.
This means that if you have not had a terminal before you will have a four day cash flow issue.
There are some agreements that charge a premium for next day payments to the merchant. Beware, they are expensive.
Remember, after your initial four day wait, a payment will hit your bank every day.
