Tag Archives: payment processing

Alipay Launches International E-Wallet, Giving Tourists Access to a Mobile Payment Platform in China

Those who’ve spent any time in China as a tourist will know first hand just how difficult it can be to perform the seemingly simple task of paying for things with a format other than cash.

One of the most popular forms of mobile payments in China is Alipay, and most people will use Alipay to make payments using a QR code on their phone. The vast majority of places won’t accept domestic staples such as Visa or Mastercard, so most travelers would have no choice but to rely on cash until Alipay’s recent intervention.

Until Ant Financial, the Alibaba affiliate that runs Alipay’s platform, made the following announcement earlier this month, users of the Alipay platform were required to have a Chinese bank account. Until now, that is, with Alipay announcing a program called “Tour Pass” through which the company will introduce a version of the Alipay app that will launch and feature full support for international debit and credit cards. Once users have download the Alipay app onto their iOS or Android device, they will be able to use their phone number to set themselves up for the international version of the app.

Alipay users will then be able to top off a pre paid virtual card from their Visa, Mastercard, Singapore’s Diners Club, or Japan’s JCB cards and begin spending all across China. The international version will not be available to Hong Kong and Macau users as there is already Alipay HK that they can use. If Hong Kong users need to use the international version of Alipay, they can do so by opening a Chinese bank account through Bank of China from within Hong Kong.

The minimum top-up amount for the 90-day prepaid card is 100 yuan and the balance will be capped at 2,000 yuan. Users will be able to top up the card multiple times.

This move allows Ant Financial to further extend its reach and dominance across the domestic Chinese market and cement themselves a place in China’s ever-growing tourism industry. In 2018, Chinese tourism saw an increase of 4.7% on their numbers from 2017, which works out to 30.5 million additional foreign visitors, to bring the total to 141 million. Ant Financial estimates that these 30.5 million tourists spent around US$73.1 billion while in the country on food, shopping, lodging, and other things.

Alipay’s biggest competitor in China’s cashless economy is WeChat Pay, run by Tencent Holdings. Both Alipay and WeChat Pay have a higher than 90% penetration rate amongst online users, according to a report from 2018 on China’s third-party mobile payments market. WeChat Pay has also announced plans to introduce access to their mobile payment platform for international visitors, only with additional support for American Express customers.

Upon Tencent’s announcement, Visa tweeted: “This partnership means that we’ll be working towards an environment where Visa cardholders will be able to use their Visa card in China at the millions of places where WeChat Pay is accepted, instead of having to rely on cash.”

What to Look For in a POS

Finding a new point of sale system for your business can be a tricky undertaking. Before you jump the gun on something that may not quite be right for your business, however, take the time to read ahead and learn just what questions you should be asking when looking for a new point-of-sale system.

How Well Does the POS System Work Between Your Retail and Online Store?

Data provided by the National Retail Federation shows that as many as 6 out of every 7 consumers will be researching a product online before deciding to buy it from a brick-and-mortar store, and it goes without saying that any business with a presence both in-store and online will have an edge. You should think of an online store as a store that never closes, and with the right point of sale, you can get your brick-and-mortar store online and available to new customers. If you will have an online and retail presence, make sure you choose a point of sale system that can work together with both channels of your business with a consolidated back-end. Most systems simply aren’t equipped to work with both online and offline sales.

Does the POS System Work Well For Your Staff?

A point of sale system is only as good as the employees who will be using it. It’s a good idea to try a system before investing in it and get input from your staff. Is the system intuitive? How much training will it require? Does it have the potential to improve productivity and customer experience? No matter what system you choose, be prepared to train employees on how to use it and its features to make sure customers aren’t kept waiting and you can benefit from features like inventory management.

Are Reporting and Analytics Offered?

Gone are the days where a merchant would be flying somewhat blind. With a good POS, you’ll be able to keep track of exactly how well your business is doing, what is selling and what isn’t, and even which employees have the best sales. You can even create and track employee schedules and manage inventory directly through the point-of-sale system.

Can the Point of Sale System Help You to Run Targeted Ad Campaigns?

Unfortunately, fewer than 1 in 10 new prospects will actually make a purchase. On the other hand, more than 6 in 10 returning customers will. Because of statistics such as these, today’s leading marketers are crafting more custom-targeted ads and focusing on what the customers actually want to know. With the right point-of-sale system, you can improve relationships between you and your customers and send more relevant communications. Depending on the features, you can use the system to determine which of your marketing campaigns have brought in customers or send win-back offers to customers who haven’t been back in a while.

Will the Growth of Your Business Be Supported by the Point of Sale System?

One of the most important things to consider with any new technology is the long-term costs and what your future needs will be. It isn’t enough to choose the simplest and cheapest option that works with your merchant services provider; you’ll soon outgrow it and regret the investment. You’ll need to make sure you purchase a scalable system that can grow along with your business.

Frequently Asked Questions

What is a POS system?

A POS (Point of Sale) system is a software and hardware combination used by businesses to complete sales transactions. It commonly consists of functionalities like tracking stock, generating sales reports, handling payments, and managing customer interactions.

What should I look for in a POS system?

When choosing a POS system, consider the following factors:u003cbru003e● Functionality: Make sure the system aligns with your particular business requirements, including the ability to track inventory, efficiently manage employees, and seamlessly integrate with other software solutions.u003cbru003e● User-friendliness: Seek out an intuitive interface that is simple to navigate and train your staff on.u003cbru003e● Payment processing: Check if the system supports various payment methods, including credit cards, mobile payments, and online transactions.u003cbru003e● Reporting capabilities: Determine if the system provides detailed sales reports, inventory insights, and analytics to help you make informed business decisions.u003cbru003e● Scalability: Consider whether the POS system can grow with your business, accommodating additional locations, products, or users.

Should I choose a cloud-based or on-premise POS system?

When selecting a POS system, you should consider whether a cloud-based or on-premise solution is more suitable for your needs. Cloud-based systems offer the advantage of accessibility from any location with an internet connection, along with automatic updates and remote data backup. Conversely, on-premise systems provide greater control over your data and may be preferable if you have limited or unreliable internet access. To make the right choice, assess your business requirements, budget, and IT infrastructure.

What about customer support and training?

It’s crucial to assess the level of customer support and training offered by the POS system provider. Look for providers that offer reliable customer support channels, such as phone, email, or live chat. Additionally, inquire about training resources, including user guides, tutorials, and in-person or virtual training sessions, to ensure your staff can effectively use the system.

How much does a POS system typically cost?

The pricing of a POS system can differ based on various elements, such as your business size, the desired features, and the pricing structure offered by the POS provider. Some providers charge a monthly subscription fee, while others may have a one-time purchase cost. Additional costs to consider include hardware expenses, payment processing fees, and potential add-ons or integrations. It’s essential to evaluate the total cost of ownership and return on investment when choosing a POS system.u003cbru003e

What is Interchange Plus Pricing in Credit Card Processing?

To increase transparency in the pricing of credit card processing, credit card processors offer interchange plus pricing, which is often compared to a wholesale processing fee. Under the interchange plus pricing format, businesses pay interchange fees and processing costs separately. Visa, MasterCard, and Discover charge the interchange fee, and a business’s credit card processor charges the processing cost. This model is unlike tiered pricing, which rolls all costs into one large payment leaving a business at risk of overpaying via hidden costs and surcharges.

Tiered Pricing Versus Interchange Plus Pricing

Tiered pricing, which was once the most common credit card processing service, groups interchange fees into rate tiers. Also known as bundled pricing, tiered pricing involves qualified, mid-qualified, and non-qualified rate tiers, giving the model its name. Credit card transactions are categorized according to card type, card category, transaction method, and more, which impact the tier level in which the transaction is placed when processed.

Rather than pay interchange fees directly, businesses pay credit card processors according to these tiered rates. The processors then pay the interchange fees on behalf of the businesses. Instead of listing the actual interchange fees, credit card processors list only the qualified, mid-qualified, and non-qualified rates under tiered pricing.

Rather than revealing the actual cost, credit card processors can place transactions in the more expensive non-qualified category, thereby increasing business costs while simultaneously keeping the same rates. An alternative to tiered pricing, interchange plus pricing bills interchange fees directly to businesses. Then, businesses pay the credit card processor a fixed percentage separate from the interchange fees. The fixed percentage markup and the interchange fees combine to form lower costs to businesses.

Interchange Plus Pricing Benefits

In addition to the lower costs presented by interchange plus pricing, the model also offers transparency to businesses. Credit card processing is easier to reconcile under the model. Eliminating surcharges and hidden costs, interchange plus pricing’s “interchange pass through” leads to optimized interchange costs, which is often compared to a wholesale model. The markup is equivalent to a membership fee in exchange for wholesale interchange prices.

Interchange +

The simplicity of interchange plus is in the name itself: “Interchange Plus.” A business pays the interchange rates, which are set by the major credit card companies. The “plus” is the markup charged by a business’s credit card processor. Within the simplicity of interchange plus pricing, businesses can further minimize costs by choosing a processor that offers a low markup.

Host Merchant Services

Before taking our first customer, Host Merchant Services studied the numbers and decided Interchange Plus pricing is the most cost-effective pricing model for businesses, not to mention the most transparent. We educate our customers to ensure they fully understand the pricing model. Knowing the details prevents businesses from overpaying with us or with any credit card processor. Host Merchant Services even explains where our profit lies in the pricing structure to be fully transparent in all directions. Pricing fairness and transparency is our strategy in helping our customers find success with their businesses.

What is “Friendly Fraud” and How Can My Business Handle It?

Friendly fraud can be summed up as an honest mistake: reporting a charge as fraud when a customer did indeed make that purchase. Often times this happens unwittingly either by another member of the household or by the cardholder themselves long since forgotten. Instead of working with the merchant to obtain a refund, customers file a chargeback with their credit card company, resulting in the bank issuing a refund on the merchant’s behalf although the merchant did not commit a mistake.

Various Reasons for Chargebacks

Whether they claim the product wasn’t delivered or the product didn’t match the proper description of the item, a customer can file a chargeback for these and other reasons. Sometimes customers simply do not know the difference between a return with the merchant and a chargeback from the bank. Other times, virtual shoplifters leverage the chargeback rules in their favor by ordering goods, receiving those goods, and then not paying by disputing the charge also known as chargeback fraud.

In addition to the cost of the goods, merchants also pay chargeback fees, lose shipping costs, and spend time and money disputing charges. Making up 40 to 80 percent of a business’s losses in fraud total, friendly fraud results in merchants eating the costs.

Minimizing Friendly Fraud Incidents

Merchants can implement several practices in preventing chargebacks including keeping an open line of communication with customers. This will help customers get in touch with the merchant rather than the bank when they need to return a product or service.

Merchants should also make their billing descriptor easy to identify. The name of your business on a credit card statement should trigger a memory of a legitimate purchase rather than trigger alarm that someone is fraudulently charging goods to a customer’s card.

Merchants can display the refund policy on their website outlining the timeline in which the customer must return the product. If merchants offer refunds and cancellations immediately, customers won’t need to resort to filing chargebacks with the bank. Merchants can make it easy for customers to return a product with pre-paid shipping labels. Also, merchants can notify customers of recurring payments to prevent a surprise charge and the resulting call to the bank.

In addition to using delivery confirmation as a business practice, merchants can also keep a paper trail of all transactions to further inform customers of the details of the purchase. By offering details about the transaction, merchants can help customers recognize the purchase. This practice will dissuade fraudsters with ill intent from pursuing fraudulent purchases from the merchant with the current and future purchases.

On the front end of the transactions, merchants can collect as much customer data as possible to help keep track of the order history. In this same session, merchants can use a software requiring customers enter their complete credit card information, as well as allowing customers to review the order and then verify the purchase.

Merchants can also use data to notice trends with repeat offenders of friendly fraud. With heavy doses of data and communication, merchants can make cuts in their friendly fraud costs, as well as improve their relationships with customers.

How Artificial Intelligence is Impacting Cybersecurity [2023 Update]

AI has been something of a hot topic over the last few years, and many are debating whether or not its impact on human life is a good thing or a bad thing. AI is being relied upon more and more frequently by today’s enterprises, especially when it comes to cybersecurity. Here’s a look at the potential benefits and drawbacks.

The Positive Impacts of AI on Cybersecurity

In today’s online security world, secure biometric logins like fingerprints, retinas, or palm prints are being used with increasing frequency, either alone or in conjunction with a password. The majority of new smartphones use this technology, and with more and more large corporations being the victim of security breaches, cybersecurity experts have continually made it known that passwords alone can be extremely vulnerable.

Typically, information such as credit card numbers and other personal information such as email addresses and passwords is what gets compromised during a cyber-attack, so beefing up security with positive AI contributions such as biometric logins is a sure-fire way to tackle the problem.

AI is also able to detect all kinds of threats and potentially malicious activities. Unfathomable amounts of malware are created month after month, and older, conventional systems are simply unable to keep up. AI systems are being taught by cybersecurity companies to detect malware and viruses effectively with the use of complex algorithms. Even the smallest behaviors of malware or ransomware attacks can be picked up by an AI system and dealt with before they can achieve their goals.

Multi-factor authentications are one of the applications to which AI systems can be applied. If different users within a company have different levels of authentication privileges, also depending on where they’re accessing the data, AI can provide a much more dynamic authentication framework, which can collect the user information, in real-time, to understand the behavior of the person and determine their access privileges.

It’s estimated that up to 85% of customer interactions can be managed with AI as early as next year, and many e-commerce businesses have already turned to some type of AI to generate leads, improve customer experience, and gather insight into customer behavior. For example, an e-commerce business can improve the customer sales experience by integrating the technology with a CRM system to solve customer problems, answer questions, or support voice input.

The Negative Impacts of AI on Cybersecurity

While the positive impacts above don’t even begin to scratch the surface of the potential possibilities of AI lending its hand to cybersecurity, it is, however, worth mentioning that there are some downsides and limitations that prevent AI from going mainstream.

If an AI system is to be built and maintained, it would necessitate immense amounts of data, memory, computing power, and other resources. Also, due to the way in which AI systems are taught through learning data sets, it can take an incredibly long time, and at a fairly substantial cost, to source all of the malware codes, non-malicious codes, anomalies, and other data sets required.

One other negative point to consider is that hackers will also use AI themselves to test, improve, and enhance their malware with a view to it essentially becoming AI-proof. AI-proof malware can, as a result, be incredibly destructive as they learn from existing AI tools to develop more advanced attacks and easily get through both more traditional cybersecurity systems and even AI-boosted cybersecurity systems.

And one last thing to consider if you are a merchant and you are worried about data breaches affecting your bottom line: Host Merchant Services Data Breach Security Program. Click that link to download a PDF explaining the value-added service HMS provides its merchants that goes above and beyond just simple PCI Compliance and helps ensure a merchant’s peace of mind.

MasterCard’s Dispute Resolution Initiative

Mastercard is rolling out its new Dispute Resolution Initiative for payment processors and merchants that will bring many changes to how Mastercard chargebacks and transactions are handled.

The initiative, which has a goal of improving chargeback outcomes and efficiency, will likely mean a more consistent process for merchants. The Dispute Resolution Initiative is being rolled out in four phases and began in October 2018 with a final phase rollout scheduled for April 2020. The latest changes went into effect in October 2019.

What Merchants Should Understand

The Mastercard Dispute Resolution Initiative (MDRI) brings modern solutions to payment processing and chargeback resolutions. MDRI puts more responsibility on issuing banks which must collect information from cardholders like a receipt before initiating a dispute which rules that aim to prevent double refunds completely and reduce invalid disputes that are expensive for merchants.

Merchants won’t use Mastercard’s new dispute system, MasterCom, directly. Instead, the payment processor uses it on the merchant’s behalf. Acquirers and issuers will use MasterCom to initiate and respond to every Mastercard chargeback. As a merchant, your processor can submit supporting documentation through the system if you want to fight a chargeback.

The new dispute system is similar to Visa Claims Resolution (VCR) which Visa rolled out in 2018. VCR, a method of simplifying the chargeback process, automated 80% of dispute volume and reduced the average chargeback resolution time from 54 to 23 days.

New Payment Processing and Chargeback Rules

The Dispute Resolution Initiative adds new processes, technology, and rules to automatically validate dispute requests, open new communication channels between merchants and cardholders, and create a central dispute management platform for acquirers and card issuers.

During the first phase of the rollout, Mastercard instituted a new rule that requires issuers to request more information from cardholders to file a Mastercard chargeback for these reasons:

Cardholder Does Not Recognize (4863)
Cardholder Dispute, Recurring Billing and Digital Goods (4853)
Point of Interaction Error (4834)
Incorrect Transaction Amount (4831)

For these reason codes, issuers must get supporting documentation. For disputes over digital goods or recurring transactions, there must be a cardholder email, letter, or expedited transaction dispute form.

By obtaining more information at the beginning of the chargeback process, the goal is to reduce the number of invalid chargebacks.

Mastercard also added a new pre-compliance requirement. Before an issue can be escalated to a compliance case, a pre-compliance case needs to be filed.

During the second phase, Mastercard instituted a new rule that refunds cannot be initiated after a chargeback is reversed or filed. An acquirer cannot use a pre-compliance case to reverse a second refund if credit is issued for a disputed transaction. Acquirers can still recover the money with a new presentment if the time limit allows, through a pre-arbitration case filing if credit is issued after a second presentment, or through collections.

Issuers are now instructed to check for a reversal or refund before a chargeback and accept a second presentment if the transaction is submitted as “Credit Processed.” Always verify if the customer’s bank is involved before filing a refund to avoid a double refund.

Issuers can no longer use the following reason code for a Mastercard chargeback:
Fraudulent Processing of Transactions (4840)

The timeframe to file a chargeback for a Point of Interaction Error (4834) has also been reduced to 90 days from 120 days.

Changes Still Planned

Phase four of MDRI in 2020 will streamline the chargeback process by removing the arbitration or second chargeback cycle. Instead, card issuers can continue disputes with pre-arbitration before escalating to arbitration in case of fraud. This will be similar to the Visa Claims Resolution process.

During the final phase, Mastercard will eliminate the following reason code for a chargeback:

Cardholder Does Not Recognize (4863)

The Millennial Generation is the Debit Card Generation

Cash or plastic? When members of Generation Y are asked this point-of-sale (POS) question, they are more likely to choose plastic, but not necessarily a credit card. According to research by PSCU, a payment processing provider for American credit unions, older members of the Millennial Generation, those who are between the ages of 31 and 38, tend to prefer debit card payments over lines of credit by a margin of 40% versus 36%.

Credit vs. Debit

The PSCU survey shows that paying with credit is more popular among members of Generation X, but things get interesting with younger members of the Millennial Generation, those who are between the ages of 23 and 30, who happen to prefer credit at an even higher rate than their Generation X counterparts. The youngest in the Millennial Generation cohort are evenly split in their credit over debit cards preferences at 29%; they actually prefer to make payments with cash, but instead of bills and coins they really like digital platforms such as Venmo, Google Wallet, Snapcash, PayPal, Facebook Messenger, and others. These young consumers, who are between the ages of 18 and 22, really like the idea of doing away with plastic and using their smartphones, which suggests that they are the perfect segment for digital currencies.

Young adults who are part of the Millennial Generation may not always realize that the payment processing structure of their beloved digital wallets are actually debit cards, but this is not something they worry about; they do not like carrying plastic cards and only keep a small amount of cash on hand just in case. They understand the concept of credit over debit, and this is probably why they prefer the latter; when they learn about the struggles many of their parents went through when revolving consumer credit was widely available, they prefer not to bother with this aspect of personal finance.

What Should Credit Card Companies Do?

Other personal finance research studies on the payment patterns of the Millennial Generation shed light on another aspect of credit and debit cards that young adults dislike, specifically data breaches. Such security issues are being considered by younger consumers, but there is also a certain aversion to the traditional banking system. It should be noted that a little over 25 percent of younger Americans have never used a credit or debit card, they think that checks are antiquated, and they dislike the idea of having to stand in line at the bank. They don’t mind using prepaid cards, which are another form of debit cards, as long as they are tied to mobile apps and have a disposable feel to them.

What should banks and issuers of payment cards do to entice the Millennial Generation? Mobile apps and innovation are clearly the answer, and they should start looking into digital currencies, perhaps beginning with safer options such as the USDC managed by investment banking giant Goldman Sachs. Something else to keep in mind is that younger consumers like rewards, social media features, and the ability to instantly transfer small amounts of cash.

How to Avoid Common Mistakes When Getting a Merchant Account

Choosing a merchant account can be overwhelming. With innumerable fee structures, not to mention growing varieties of payment options, a business can spend full-time hours simply keeping up with the fast pace of credit card processing trends. If you follow the advice from the steps listed below, you’ll be ahead in the merchant account game:

Look for Reviews

When you begin the discovery process with a merchant account provider, seek references and research reviews. Rather than read testimonials on their website or blog, find forums that objectively discuss merchant accounts. Then, follow up by checking online reviews and by contacting one of their customers whose business is similar to yours to determine their satisfaction with services.

Once you have your short list, ask your potential merchant account providers for details and processes regarding your potential Account Manager and the overall customer service staff. When and how is the customer support team available to merchants? You will need a contact name and direct number for assistance at any time.

Avoid Hidden Fees

Due to the complexity of merchant services pricing, it’s easy for payment processors to hide fees in their statements. Terms such as “qualified” and “non-qualified” rates are red flags indicating tiered pricing, which allows the payment processor to determine which transactions don’t qualify for the lower rates.

In order to ensure there are no hidden merchant fees on a sample statement, ask them to explain rates and fees, including ancillary fees. They must be open and honest about their merchant account fees. Check the MasterCard and Visa websites to compare their rates to the rate quoted by the merchant account provider to ensure they’re not quoting a low rate to obtain business. Explicitly request the following: application fee, set up fee, batch fee, statement fee, monthly minimums, PCI compliance fee, IRS fee, and annual fee.

Ask if they bill for additional services. Ask if they auto enroll merchants in free trials that require the merchant to opt out if not interested. Ask if they back-bill for fees versus bill fees in the same month they occur. And ask how often they raise rates.

They May Not Support Your Equipment

Confirm their services are compatible with all terminals, gateways, point of sale (POS), mobile devices, chip & signature, Apple Pay, and eCommerce, among others.

Avoid Long-Term Equipment Leases

If you need credit card machines or payment processing devices, ask if they are new or refurbished. Determine if you are buying or leasing the equipment – and what is the cost? Relative to buying, equipment leases are more expensive in the long run. While a credit card terminal can cost a few hundred dollars to buy, a lease can end up costing thousands of dollars over the course of a few years at $30 per month at minimum.

Don’t Be Just Another Residual

Because your merchant services company should view you as a valuable customer, they should increase your payment-processing efficiency, improve your customer service experience, and save your business money. Ask for the payment processing options available. Note whether or not they discuss building long-term relationships with merchants.

Before Signing the Contract

Before signing the contract, learn the termination process. Ask if there is a cancellation fee or early termination fee. Also, determine if the contract automatically renews. Host Merchant Services does everything month to month, no long-term contracts, allowing you to cancel at any point with no fees.

Host Merchant Services

Host Merchant Services can guarantee the lowest rates while providing the best customer service. With no term commitment, no cancellation fees, no hidden fees, and no obligation, HMS provides the highest level of customer service, earning respect from our peers, as well as from our clients. Host Merchant Services will gift you a $50 gift card if we can’t match or beat another price on the market.

Small Fees Add Up Considerably for Square

Merchants who use the services of credit card processing giant Square, which was founded by a former PayPal executive, can no longer count on flat rates for payment transactions. According to a news report recently published by Bloomberg, Square has rolled out a new fee structure that no longer sticks to the 2.75% in-store transaction charges that the company had in place for years. The fee has been reduced to 2.6%;‌ however, there is now an additional charge of $0.10 per transaction, when the payment amount is $65 and under.

When Will the Change Take Place?

New Square users will be subject to the new pricing structure right away while existing merchants can expect to see the change in early November. In a blog post published by Square in October, the company explained that the new fee schedule corresponds to an effort to align with competitors in terms of transaction costs.

Industry analysts believe that Square is starting to feel the impact of operating costs related to acquiring new merchants, particularly those that have a higher volume of micro transactions. Square is doing business in a sector that sees retailers spending $108 billion every year to accept electronic payments, and the methods the company has widely utilized to sign up new clients include innovative card readers, terminals, mobile apps, and simplified point-of-sale systems;‌ these value-added services, which are heavily geared towards micro companies such as hot dog carts, translate into high operating costs. The $0.10 fee is intended to offset some of these costs, which can hurt a small businesses’ overhead.

Why the Increase?

When compared to other merchant processing companies, the new fee schedule posted by Square is typical; nonetheless, this is a company that has a disproportionate number of users for whom low-ticket transactions are their bread and butter, and they are the ones who are more likely to complain about being charged an extra $0.10. To a certain extent, Square risks losing clients such as the aforementioned hot dog cart operators, coffee shops, and convenience stores, but average retail transactions are estimated to be between $30 and $35. If anything, Square is attempting to gain more new clients, which could be at the expense of their current ones.

According to WCYB, an NBC‌ News affiliate based in Tennessee, small business owners in the region are not happy with the higher fees being charged by Square. The operators of a bakery, a cafe, and a catering provider explained that they will be passing on costs to customers, and they are strongly considering shopping around for a new merchant processor that specializes in small businesses.

Global Payments, TSYS Complete Merger

In a $21.5 billion all-stock deal, Global Payments Inc., a global provider of payment processing technology and software solutions, merged with TSYS (Total System Services) to form a pure-play payments company using the name Global Payments, the largest merger of payment technology companies to date. Working with 1,300 financial institutions and 3.5 million merchant locations in more than 100 countries, facilitating credit card processing for more than 600 million cardholders, the merger positions the company to be a leader in owned software, integrated payments, and omnichannel solutions.

TSYS can leverage Global Payments 32-country global reach to access the global markets during a time when e-commerce transnational transactions are on the rise. By focusing on merchant services and payments-related business, the merged company hopes to differentiate itself from the other fintech mergers, according to TSYS CEO Troy Woods. For example, the TSYS Netspend business offers reloadable payment products while the merged company will also engage in consumer solutions and merchant acquiring.

A pure-play payments technology firm, Global Payments’ headquarters is located in Atlanta, Georgia with more than 24,000 employees around the globe, serving countries in North America, Europe, Asia Pacific, and Latin America. Offering global solutions and advanced software, Global Payments offers a technology-enabled strategy to merchant services.

Following the $35 billion FIS acquisition of Worldpay and Fiserv’s $22 billion acquisition of First Data, Global Payments’ acquisition of TSYS is another big fintech merger for 2019. TSYS shareholders will receive 0.8101 of Global Payments shares for each of their own. Global Payments investors will own 52 percent of the new company, leaving the remaining 48% percent to TSYS shareholders. Traded on the New York Stock Exchange (NYSE: GPN), Global Payments is a member of the S&P 500. Global Payments gained 1.0% in premarket trading.

TSYS holds a presence with smaller retail merchants, and Global Payments has a strong hold with restaurants with each providing point of sale (POS) solutions tailored to those industries. Combining TSYS’s strength as a U.S. payment provider with Global Payments’ strength as an international payment provider makes for a stronger whole.

Jeff Sloan will serve as CEO of the merged Global Payments company, Cameron Bready as president and chief operating officer, Paul Todd as senior executive vice president and chief financial officer, and David Green will serve as the senior executive vice president, general counsel, and corporate secretary. Josh Whipple will serve as chief strategy and risk officer while Gaylon Jowers oversees issuer solutions, and Kelly Knutson oversees NetSpend.

“We share a common value of putting people first and will leverage the best of our cultures to preserve and enhance our commitment to all of our stakeholders,” said Jeff Sloan in the press release announcing the merger.