Are Visa/MC phasing out 3rd party CC processors?

paysystems.com says so...

[Algebrator]

I have been using paysystems for processing CC for a while now, and am pretty happy with them.
Recently I got a message from them saying that they want to switch me to merchant status (better fees etc.), which I refused because I was just fine "as is".
Well, it turns out that at some point I will have to - the reason mentioned was that "MC/VISA are phasing out 3rd party CC processors". My main problem is that now they require a US account to settle and this to me is unacceptable.
Any comments are appreciated

[Essex_boy]

News to me, I wonder why?

[Algebrator]

No idea, I have a relatively loose deadline of July 2004 to make the switch

[Corey Bryant]

Visa / Mastercard are not pahsing out third party processor - even though they would love to. Paysystems is just switching to merchant accounts. more cost-effective.

-Corey

[Algebrator]

Do you think they will completely eliminate their processing?
So far I am being 'gently coerced'; I am wondering if
I just flat refuse, whether they will come back saying that my account will be terminated on such-and-such date.

I really have no desire to change anything, everything has been working just fine "as is"

[Corey Bryant]

I am not too certain exactly what might be going on. We were referring people over to them for third party & then they were able to offer merchant accounts in the US. About a month later, we were told they would be asking everyone to switch.

But you do need to find out if they are stilll going to support you. If not - you will need to find either another third party processor or get your own merchant account.

-Corey

[guitman]

I have been using paysystems for about a year now and to date have received any notices concerning these plans. I've just emailed my account manager and if I receive an interesting reply I will let you all know.

[blaze]

It will be a battle royale with PayPal if that is the case.

[Miklo]

Algebrator,
I work for a credit card processing company myself and I have to say that we have been in combat with Visa/MasterCard since last year, when they all of a sudden changed their rules. Changing rules would normally be no problem, but the way they are doing it always affects us and we are always busy to comply with their rules. Their new rule stated that we are no longer allowed to process for online pharmacies. All online pharmacies had to be shut off before April 1, 2004. If not, we would be fined 25,000 USD per day. They told us about these new rules on March 26! Of course, we had to inform all our merchants and shut off all these companies, however, the given timeframe was way too short.
We choose to suspend MasterCard for a certain amount of time, which gave us time to get everything on track. Before this problem occured we have had several other issues with MasterCard, one of them stating that they could no longer allow our business model, while it is exactly the same as 2CheckOut. So in my opinion, yes, they are trying to rule out the 3rd party processing companies.

[Algebrator]

Miklo,
Thanks for the info, this really gives me something to think about

[jacker]

Hey Guys

The gist of the matter is that VISA/MC don't like third party processors, and never have for that matter. The reason being is that they have less control over what "their" cards are being used on...

I expect third party processing to be around for a while (unless someone has an immediate solution :) ) because they provide for an important part of the market. However, we are trying to switch as many merchants as possible over to true merchant accounts because, if they qualify, it is a better long-term solution for them.

If anyone has any questions, don't hesitate to contact me.

Cheers
James