Becoming Your Own Processor

Im tired of paying money to people for percentages of sales..

[EliteWeb]

Hello,
There are so many people out there who offer mechant services to business owners, in turn the company is dinged. I want to have my own business and because theres so much processes done I dont want to pay anyone. Do I have to be my own bank? How does this work, How can it be done? I want to offer the merchant service to myself and not charge myself but still do it... Hope that makes sence.

[Shakil]

You slightly lost me, from what i can work out , this is how things work:

Visa/Mastercard > Acquiring Bank > Merchant

however increasingly its becoming:

Visa/Mastercard > Acquiring Bank > Merchant Solution Provider > Merchant Broker > Merchant (me, you etc)

so which stages you want to bypass, do you just want your own account, so it shows "your company" on clients statement?

Shak

[The Contractor]

I am not sure I understand myself ;)

If you want to bypass the Processor of the transactions you would have to become your own banking entity and fall under federal banking system guidelines here in the States. Don't think it's possible. I use a virtual terminal service that then sends the actual transactions through one of the largest processors in the States which of course is a banking entity.

[mivox]

Yeah, I don't think the major credit card companies, or the FDIC would be too happy to let you set up your own merchant services business in your living room. ;)

[gaouzts]

It also violates VISA/Mastercard regulations. You cannot process credit card charges for other merchants through your own merchant account--period. Companies like IBill, CCBill, etc., have a special status with VISA. They are classified as an IPSP (Internet Payment Service Provider) and as such, are subject to volumes of regulations. Even though there are seemingly legitimate businesses doing this who are not IPSPs, VISA is agressively shutting them down.

[Shakil]

gaouzts,

hits the nail on the head.

last week of November, 1 of the biggest "ISP/Bureau/3rd Party processor" had all of their 500 merchants shut down over night.

Shak

[stlouislouis]

Hi Shakil,

Which one was shut down?

Thanks,

Louis

[Shakil]

I would rather NOT name companies publicly, rest assured they are back up and running under new Visa/Mastercard regulations.

Shak

[Slade]

It also violates VISA/Mastercard regulations. You cannot process credit card charges for other merchants through your own merchant account--period. Companies like IBill, CCBill, etc., have a special status with VISA.

That's not what the original poster wanting to do. They wanted to insert themselves at the second or third level to cut down or totally eliminate the "discount rate" charges. They made no mention of reselling this service to others.

[Namaste]

Coming in v. late on this. But, how do companies like PaySystems, 2Checkout, etc. do it, whereby they provide an all in one solution?
Visa/Master > All in one > website.com

[brendan]

In the UK there is a body called APACS which is a network of banks and PSP's who clear payments.

We have a list of about 5 million card details that are suspected of fraud.

We have inteligent processing to guess the risk of chargebacks/ fraud.

It costs literally 100k plus to set yourself up as someone who is a PSP you need a direct link to clearing banks and a great deal of experise.

In the UK banks wouldn't touch you they already have about 100 PSP's and don't want any more. The simple answer to this thread is if you have to ask you are not going to be able to set yourself up at the top level. People frequently fail to realise the expertise required to run systems such as these and while I have no doubt there are many merchants who could give it a shot it's really not cost effective unless you have a lot of transactions we have loads of transactions and it is still cost effective for us to pay our PSP more than 1k a month in fees than to try and do it ourselves.

What you could do is get your own merchant account and use a PSP that is what we do and is about as close as you can get unless you are putting through above 50,000-100,000 transactions per month.

Take a look at the merchant services categories in dmoz.org for companies that would be able to help. I edit the UK Merchant services cat by the way.

Happy to advise if anyoe needs further specific info on this subject just sticky me.

[Shakil]

Paysytems have a very complicated and secure legal position with 1 of the worlds biggest banks, as do a handful of other players.

To be honest unless you have a Million $$$$s lying around to invest in this sort of project, then you cant do it.

Still LOTS of opportunities 1 or 2 levels down, with serious ongoing % for life.

Shak