Merchant Processing Solutions Inc.

Q: How quickly should I get my money after settlement?

         This is great question and the answer is, it depends!!

         

Many people think that closing the batch at anytime should mean that your money is instantly in your bank account. This is anything but true. Companies like Square and PayPal offer "instant deposits" but at at cost! Square charges an additional 1% while PayPal will only allow you to use those funds to purchase on PayPal payment acceptance sites or transfer those funds to your PayPal Debit Card.
However, most merchant processing companies take between 1-4 days to process.

Why does it take so long to get my money? Several factors influence that timing. 

• One of the first issues is when you close your "batch" and "settle" your daily transactions. If the merchant processing company, in California, has a cut-off time of 5pm Pacific Time and your office is in South Florida, you would have to batch before 8pm for that payment to be considered a TODAY BATCH. 

• Using that scenario, the next step we need to know is how quickly does the merchant processor's "Acquiring Bank - Merchant Services Bank that receives all the transactions from that batch send those transaction amounts to the "Issuing Bank". Then each "Issuing Bank - a bank acting as a middle-man for customers/cardholders to connect transactions to their credit cards" sends the transaction information out to the actual credit card companies for repayment those transactions. This can be a few hours or a few days! It totally depends on what your merchant processing company has negotiated with both the Acquiring Bank and Issuing Bank. In years past, a merchant would pay MORE to get Next Day or Early Funding. 

• It evens get more crazy when dealing with ONLINE SALES!! When does your online payment gateway batch? Where is that company located, CA, NY, KS? OK, they are in CA (3 hours from FL) and do ALL batches at 5PM PST. I need the money to get to my merchant processing company by 6PM CST. 

• What time zone is my software? What time zone are my customers/clients making payments?????? Need I say more...

• Quite frankly, the Acquiring Bank to Issuing Banks is a pretty quick and seamless process. What I find is the Merchant's Bank - Wells Fargo, Citibank, Bank of America, etc. Some of these banks still do the deposits from merchant processing sales manually. And for some reason they can take more than a day to enter those funds into your bank account. We have seen this time and time again. Our Issuing Bank pays you and the money is just not in your account? Why? We have come to find out that it has to do with internal cut-off time, your credit rating within the bank, sometimes the size of the deposit etc. In my opinion, these guys want you using their merchant services partners to do your processing so they can make their money. So if you are not processing with them; they don't always make it easy. 

• Banks, using their merchant processing partners, usually offer Next Day Funding unless the equipment used or software has an additional time for batch which pushes the entire deposit process off by a day or so. However, Next Day Funding come with a price. Banks get about 25% of each transaction, sign you to a long-term contract and LOVE to lease you equipment!

• A main talking point for TEAM MPS Inc. is asking our potential merchant what time they close for the day. It may not be convenient for a merchant to close their batch earlier than they close. Example: A merchant is processing through a company that requires you to close the batch for Next Day Funding eligibility by 6pm Central Standard Time. But your shop does not close till 9pm. Do you want to do two daily batches; one at 5:45PM and anther at closing around 9:15pm? What does that do to your daily totals and accounting? It's all about consulting with our merchants to make sure we hear and abide by their needs. 

• Another consideration is how the payment acceptance equipment communicates with the processor. It it a phone line and there are occasional noise on the line that prevents GOOD COMMUNICATION. Or are they using a terminal or software that is impacted by fluctuations in Internet speeds. MPS Inc. sets up all our equipment to batch at least 15 mins before the cut-off time to ensure that the settlement happens ON TIME for our merchants. 

In conclusion, BEWARE...Today, most reputable companies offer Next Day Funding as part of their sales package and desired benefit by most merchants. AND It should be offered at NO ADDITIONAL COST! 

Merchant Processing Solutions Inc. offers Next Day Funding to all their merchants after asking these key questions:

• Do you want or need Next Day Funding?
• What time can you batch? Does that cut-off time meet the criteria of the Acquiring Bank? 
• Have we considered the merchant time zone and the merchant processing time zone?
• What equipment or software are you using? Do they have any specific batch constraints to impede closing at a desired time?
• What bank are you using? What time do they need to get the deposit to consider it Next Day Funding?