Do I need Signature Debit and Pin Debit?

The Brands

Customers can purchase products and pay for services using different types of credit cards: Business, Corporate, Government, Personal, Rewards - Points or Cash, Standard, Debit and Pin Debit. I have discussed in previous blogs the difference in merchant processing Business, Corporate, Government and Personal. 

PIN PAD for PIN Debit Card Acceptance

 

Today, I would like explain the difference between DEBIT CARDS: PIN DEBIT (Personal Identification Number) and SIGNATURE DEBIT. Seemingly similar, there are notable differences:

• Customer Identification 
• Signature Debit Cards are verified by the customer's signature on their sales receipt. Signature Debit Account come with all credit card processing accounts. 
• PIN Debit Cards require the customer to enter a personal identification number. If you want a PIN Debit Account, you will have to sign up for one with your credit card company as it goes with the PIN Network and not the credit card network. So in essence you have two different account on your statement! 
• Purchase Limits
• Signature Debit Cards are approved if the customer's credit limit has not been met or the card reported lost or stolen
• Pin Debit Cards are ONLY approved if there is enough money in the their bank account to cover the purchase.
• Transaction Authorizations
• Signature Debit Cards are approved through the credit card Brands Network such as Visa, Mastercard, Discover, or American Express. The customer will be approved based on the credit limit on each card.
• PIN Debit Cards are connected to pin ebit networks such as Interlink, STAR, Maestro, Cirrus, and many others. Debit network checks the bank account associated with that PIN Debit Card and only approves the transaction if there is enough money to cover the transaction at that moment!
• Merchant Services Pricing 
• Signature Debit goes through the Brands (Visa/MasterCard/Discover/American Express) and a merchant processing company to make purchases. Each of those entities charge for their services so traditionally, using or accepting payment with a credit card can be higher than with Pin Debit Cards.
• Pin Debit Cards typically include lower percentages than credit cards, but they come with higher fixed per-transaction fees. A merchant can save money by accepting Pin Debit for large sales but the customer has to have that money sitting in the bank account for that transaction to be approved! 
• Monthly Service Fees
• Signature Debit cards run through a Merchant Services Company like Merchant Processing Services and you can negotiate your monthly fees and rates. 
• Pin Debit Cards run through the PIN Network and have monthly fees that are Non-negotiable. 
• Payment acceptance
• Signature Debit can be accepted via a regular terminal, online, over the phone, via an Invoice in person or card not present. 
• Pin Debit Cards require a special Pin Pad machine that attaches to a terminal. Each transaction must be IN PERSON and the customer must enter a valid PIN into the Pin Pad device for the transaction to be valid and go through the PIN Network for a lower price. 

Signature Debit Cards

I would be remiss to not include the 2011 Durbin Amendment  and its impact over that last several years in the processing of Debit Cards. The Durbin Amendment caps debit card fees charged by banks with assets of more than $10 billion at about .05%. These are your large national banks Citibank, US Bankcorp, Bank of NY, Wells Fargo, etc. Smaller, local banks with less assets can charge anywhere from .05% - 1.25%.

Understanding if you should take Signature Debit or Pin Debit or both is vital to the success of your company. 

• Anything CARD NOT PRESENT (Online/Call Center/Invoice/Via Smartphone/Via App) are NOT considered eligible for PIN DEBIT! However, you can get Signature Debit and with the Durbin Amendment, most merchants recieve the benefit of the lower mandated fees! 

• Only Retail Transactions using a terminal and a PIN PAD with a PIN Network Connection will allow your business to accept PIN Debit properly. Remember, the customer must have the money in the bank for this transaction to be approved! NO BUY NOW, PAY LATER! 

Learn more about processing debit cards and whether your business should be set up to accept PIN DEBIT! Call Merchant Processing Solutions today! 

Merchant Processing Solutions Inc.
954-938-2420

What are the steps to set up a merchant account?

1. Have a Business Plan - This plan need to include the following: 

1. Exactly what product or service you are providing.
2. What will that cost to make/acquire/distribute/marketing & sell! 
3. What is your product inventory or list of services with pricing.
4. Who is your Target Audience?
5. How will they pay you for your product or service?
•  In-person @ a store or office
• Online @ Website
• Branded Proprietary Mobile App
• Via Invoice or Recurring Payments
• Mobile Payment Capture via card readers 
6. How will the customer get the product or service? Delivery/Shipped/In-person/Pick-up
7. What should your average sales ticket be and how much do you think you will sell monthly? 

These are questions that a new business needs to consider prior to moving forward without any further costs incurred. Once you know the answers to these questions, then you can move forward with investing in your new business. 

2. What do I need to start a business?

1. You will need to create your Articles of Incorporation documents. There are many online temples for this document or better yet to protect you and your company, hire an attorney to properly set up these important documents. Cost will vary.
2. Go to Apply for an EIN - there will be a cost to this.
3. Register your Business with your state's Department of State-Divisions of Corporation - upload and pay for your business to be registered with your state. 
4. Once you have created and filed all these documents and filed them with your state, you are ready to move forward.
5. Find a location and sign a lease. Or if home office have that information ready. 
6. Open a bank account for your business. Check both banks and credit unions to see which is the best fit for your business. Credit Unions are less expensive than banks. 
• BE CAREFUL when working with these institutions, they are required to sign up business up for everything they offer. Their philosophy is the more they control your business, the harder it is for you to leave them! 
• Make sure they give you a bank letter or starter checks that contain your Business Name, address and phone #. This is required for merchant account and other services you may need to get started! 

3. First and foremost, there are many things one has to take into account before making a final decision about a merchant account provider. While rates may seem the most important, the best is actually based totally on your business, how you will accept payment, what data are you looking to capture, what software best suits your company? And the merchant service companies want to know the average transaction amount, who your customers are, what your warrantee, guarantee and refund policies look like. They want to know you have done your homework and will be a solvent and prosperous business for them to partner with! 

1. Determine your payment model: 
• In-person (retail), eCommerce/Online/MOTO (card not present) type of merchant account, (Choosing the wrong will cost you money in penalties!) 
• This depends on your product or service and the demographics of your target audience. 
• B2B customers use business and corporate cards as payment.
• Consumers use Debit and Credit Cards as payment.
• Each of these demographics can be set up so you get the best rate possible on each and every transaction! (Ask us how!)
2. Determine any hardware or software you will use in your business: 
• Track Sales
• Employees
• Inventory
• Financials
3. Determine whether you will have and use a Website for eCommerce Sales and get that started. 
• Make sure to add a Mobile App or a Mobile based website (used most these days)
4. Check LOCAL merchant service providers! 
• You will not be calling an 800# for consultations, installations and customer service! 
• READ the fine print - NO CONTRACT OR PENALTIES should you dislike their company and want to end the relationship.
• Ask if they offer B2B Optimizer if you are a B2B Business and your target market is mostly other businesses, corporations or government entities! 
• Ask if you can connect with QuickBooks from their platform
• Ask if they offer FREE SOFTWARE PLATFORM that captures data on the customer, transactions and history. 
• Ask if they have 1 Free Software Platform that can be used to capture payments via a Website (eCommerce), Call Center (virtual), In-person (retail) or Mobile (in-person remote sales). All of these comes with our Software Platform and is included with your merchant account. 
• THEN ASK THE RATES! 

Merchant Providers promote what appears to be lower rates but if you are on the wrong type of account, working with the wrong credit cards based on your customers and using the wrong software/hardware, the rates are worthless!!! YOU WILL BE PAYING HIGHER RATES AND NOT UNDERSTAND WHY! 

Merchant Processing Solutions prides itself on our consultative approach with our merchant partners. We want long-term customers that know we focus on their success! We work directly with our merchant partners from start to finish; nothing is left to chance. When they work with us, they become family! 

If you are in the process of starting a business and want some guidance through these MURKY merchant waters, call us today! 

MERCHANT PROCESSING SOLUTIONS INC.

954-938-2420

Need a temporary merchant account? MPS can help!

Does your business need a temporary merchant account? 

 Many businesses are set up for specific reasons: 

• One-time Events
• Holidays
• Seasonal Sales
• One-time Donations
• Special Online Sales

Most of these reasons are temporary and the business setting them up do not want any type of contract or cancellation fees! However, many companies that offer NO CONTRACT come with a higher discount rates and monthly fees! Why can't businesses get a one-time merchant account with NO CONTRACT and lower rates and fees!!! You can call Merchant Processing Solutions Inc, we can help! 

Example: Your business is selling homemade creams with aromatherapy oils. You have been accepting digital money, cash and checks from friends and family. Now, you have an opportunity to set up in an Expo and only want the merchant account for that weekend. Merchant Processing Solutions can help you get a one-time merchant account and very affordable rates and fees. 

Example: Your Non-Profit typically accepts checks but this upcoming carnival will be open to the public. More people no longer carry cash, and with the danger of bounced checks, a merchant account is your best option! Let us help you set up a merchant account that will increase your revenue and protect your non-profit from dirty money (fake) or bounced checks! 

Merchant Processing Solutions has helped hundreds of businesses both for profit and non-profit with temporary accounts for whatever reason needed. Let us help you! 

Call Merchant Processing Solutions Inc to inquire about our temporary accounts! 

Merchant Processing Solutions Inc.
954-938-2420