CNP Expo: Take the Bull by the Horns — Optimizing Your Payment Costs

May 19, 2015

CNP Expo: Take the Bull by the Horns — Optimizing Your Payment Costs Studying how your credit payments are routed can help you negotiate a better rate, which will save money, according to panelists in a popular Tuesday morning session at the CNP Expo. Because card-not-present interchange rates are generally higher than card-present ones, merchants look for other ways to manage the cost of accepting payments.

“We have devoted a tremendous amount of effort to dynamic routing,” said Dan Kramer, senior vice president of marketing and merchant services at Shazam Network, a debit network that issues 15.5 million cards. “Retailers on many levels are looking for savings on the routing side.”

Kramer spoke during a panel discussion titled “Take the Bull by the Horns — Optimizing Your Payment Costs” during the 2015 CNP Expo in Orlando, Fla., on Tuesday. He suggested that merchants ask their payment providers to break out their services and that they “ask them to negotiate on the cost.”

From an interchange standpoint, the industry is not uniform, said Carla Erlick, vice president of sales and business development at Optimal Payments. Merchants that are not keenly aware of their situation may pay overcharges that go unnoticed.

“Understand the local intricacies of interchange,” Erlick said. “You could qualify for a better rate. Also, explore other methods of payment.”

Panelists also cautioned merchants to question their providers so they understand the charges they are asked to pay.

“The first thing we hear from our customers is the confusion in the rates,” said Brian Compton, director of business development for VeriProcess, a company that advises businesses about understanding the fees they pay processors. “Make sure you step up and say, ‘Hey, this is not really what we agreed on.’ “