E-Commerce - What you should know.

Hey guys, just thought I'd throw some insight at you in all of this mess.

Since I work in the credit card processing industry, I thought you all could gain some useful knowledge on this.

There are so many companies out their to choose from and I'm going to make a little plug for my company, Chase Paymentech, because I understand your pain in choosing a provider.

Basically, there are only 4 major players. Chase Paymentech, Bank of America, Wells Fargo and Compass Bank. The reason I say this is because the other companies operate as an ISO piggy backing on what is called the Processing Platform that each of these banks operate. For example, PayPal uses Chase Paymentech to process the transactions that you guys run, along with companies like PayNet Systems and Merchant Express (Who are ISO's of Wells Fargo & Bank of American respectively). 3 of the 4 companies use either First Data or EDS to process the payments. They contract with First Data and EDS based on total volume. Chase Paymentech is the only one that operates their only independent platform and we service clients like Ebay, Google and AOL.

When a company operates as an ISO they add the fees they must recoop by paying the processor in turn your rates are higher.

Now, each person has a choice as to how they process. In order to process a payment you must utilize a Gateway or script in XML to the processors Gateway in order to remove the middle man. Third party gateways include Authorize.NET, Verisign, YourPay, etc, etc. They charge transaction fees on top of what the processor would charge.

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Hope this helps you guys!

Nice info, certel

Do you have any similar information for Canada?

Hogwash.

I run ecommerce sites, almost exclusive optimize ecommerce sites. Paymentech is the default payment processor for Yahoo Stores (one of my specialties) and I have worked with dosens of vendors who used them and transfered to others like Emerchant Discount Group (http://www.emerchantdiscount.com/) and E Merchant Group (http://www.emerchantsgroup.com/) BECAUSE they got better rates.

Bottom line, don't believe a company offers the best price because one of that companies employees says so. Do your homework.

Definitely agree with you on doing your homework. A lot of companies (ISO's) offer some great terminal prices that we don't compete with, although we should.

Sometimes, though, the pricing is definitely deceiving and that is the general reason for leaving.

For example; BofA used to offer great pricing, but they charged 1% surcharges for downgraded transactions. Turns that nice 1.67% retail rate to 2.67% + the billback on the interchange rate.