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Wholesale Credit Card Processing

Wholesale Credit Card Processing

“Wholesale Credit Card Processing”

This post will be short. The bottom line is when you hear this term, RUN as fast and far as you can.

There is no such thing as wholesale credit card processing.

The best thing is to know who you are really dealing with. Ninety-nine percent of the time it will be an ISO – Independent Sales Organization. To be clear, I have no issue with that (unless you are a very large merchant, because more times than not, you will get a better deal/lower discount with an ISO than with an actual processor). The processors will oftentimes mark up their discount rate to encourage you to go through an ISO because they don’t want to deal with the selling of the account, they just want the processing part.

This brings up another pet peeve… the term “Discount Rate.” Why not call it their markup? It is not a “discount,” they are not reducing the fee, they are adding to it. Oh, and then they like to say they have “Wholesale Credit Card Processing Rates.” But I digress.

There are a handful of credit card processors. The two largest are Fiserv (formerly First Data), and WorldPay (which goes under quite a few names as they get bought and spun off again, which is another long story). But suffice to say, if you are with WorldPay Oor any of the other many names they go by), make sure to take advantage of our FREE AUDIT. I’m not saying you don’t need an audit with the other guys, but we do find WorldPay is the most creative biller. (Now that was actually nice – I used the term “Creative Biller” – everyone tells me to be nicer so I am giving it a shot, and hopefully you can read between the lines.)

You will find that even the largest credit card processors don’t advertise or try to say they offer “Wholesale Credit Card Processing.” No, what you’ll find is that it’s the little ISOs (many of them working in their mom’s basement) will try to convince you that they have “Wholesale Credit Card Processing.”

To find out if you are dealing with an actual credit card processor or an ISO, just scroll down to the bottom of their website and you will see a fine print disclosure like the one below. The example is an ISO for Wells Fargo, Fifth Third Bank, U.S. Bank and Esquire Bank. In many other types of businesses, they would be considered a broker. They simply sell the contract and mark it up to get their cut which is called a “Discount Rate.”

The names above are the sponsoring banks for the processors, for example, Wells Fargo is the sponsoring bank for Fiserv (fromery First Data), and Fifth Third Bank is the sponsoring bank for WorldPay.

If you don’t see the disclaimer, then odds are you are dealing with a sales agent who are resells for the ISO, and yes, they too offer “Wholesale Credit Card Processing.” Or so they say.

Lastly, you have the MSP – Merchant Service Providers. They are the same as an ISO, only they are banks that resell merchant services.

For the person who skims articles: There is no such thing as Wholesale Credit Card Processing (only people who say things that are not true!).

Wholesale Credit Card Processing gets 4 Pinocchios!