Wednesday, April 6, 2016

Want to know more about the origin of 'zero cost credit'?  Here's some history on how Visa came to pay $6 billion in restitutions and allow merchants to pass processing fees on credit cards along to consumers:

Local Governments Now Allowed to Charge Fees for Accepting Credit and Charge Card Payments

About the author

Kara Millonzi

This entry was posted on February 8th, 2013
In a previous post, I detailed how the major credit card companies (Visa and MasterCard) effectively prohibited a local government or public authority from assessing a surcharge on customers who remitted payment of fees, assessments, and sometimes even taxes, by credit card, charge card, or debit card.
That all changed on January 27, 2013. A court-sanctioned settlement between retailers, several major banks, and Visa and MasterCard, arising out of a class action anti-trust lawsuit—In re Payment Card Interchange Fee & Merchant Discount Antitrust Litigation (1:05-md-01720-JF-JO)—now authorizes merchants (including government entities) who accept credit and charge card payments to impose a “checkout fee” on all credit and charge card transactions.
The Lawsuit
The lawsuit, filed on behalf of merchants in 2005, alleged, among other things, that the credit card issuers unlawfully fixed interchange fees.  An interchange fee (also known as a swipe fee or discount rate) is the fee paid by merchants to the credit card-issuing bank for the privilege of accepting credit or charge card payments. The fees are set by the credit card networks and vary based on type of card, regions or jurisdictions, card brand, type and size of merchant, and type of transaction. The fees typically include a flat fee plus percentage of the total purchase price involved in the transaction and average about 2-3 percent. The price-fixing claim arose out of the practice of Visa and MasterCard to set fee schedules centrally, which were then followed by other card issuers.
The parties reached a settlement in July 2012, which was preliminarily approved by Judge John Gleeson in In re Payment Card Interchange Fee and Merchant Discount Antitrust Litigation, WL 5989763 (E.D.N.Y. Oct. 24, 2012).
Settlement Provisions
According to the terms of the settlement agreement, effective January 27, 2013, Visa and MasterCard allow merchants to impose surcharges, referred to as checkout fees, on credit and charge card transactions. (The definition of merchant includes government entities that accept credit or charge cards as payment for fees, assessments, or taxes.) A merchant may assess surcharges at either the brand level (such that the charge is the same for all Visa or MasterCard transactions, regardless of the card’s issuer or product type) or product level (such that the charge is the same for all transactions on a particular Visa or MasterCard product type, regardless of the issuer), but not both. And a merchant who chooses to surcharge must comply with certain notice, disclosure, and rate limitations.
Notice. A merchant must notify Visa or MasterCard, and the merchant’s acquirer (the bank or financial institution that processes the credit and charge card payments for the merchant) at least thirty days before imposing surcharges. The notice must specify whether surcharges will be assessed at the brand level or product level.

Source and complete article here.

Download app from interface for review -- will post proper procedure as soon as I get it from Avita.




Chargebacks Rise

The Oct. 1, 2015 liability shift, which moved EMV fraud liability to the companies that are unable to handle EMV cards, is starting to take its toll. The Kroger grocery chain reports operating costs rose 23 points during the final quarter of 2015, in part from higher chargeback losses.


 Keep preaching EMV to your merchants --- the pressure of fraud losses is mounting!


News from the Field:

New Agent Steve Sasso set up an appointment with a huge car dealership in the area and asked Mike to go with him yesterday. They were armed with the cost remediation information downloaded from the interface. 

By the way if you haven't looked at that yet it is amazing!

The manager of the car dealership was enthusiastically receptive and checked almost every single box of the 17 boxes that are on there for audits.... he said they have never had any audits of this type and he's really excited about it.   He is preparing their statements to be picked up for submission.

If you haven't tried to talk to a merchant about getting  back a serious amount of money through one or more of our specialized audits,  you haven't lived!   Try it -- I think you're gonna like it !


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