You thought chocolate and peanut butter was a winning combination.  Try "Visa - Authorize.net" which should prove to spur incessant growth for both companies.  On April 21st, Visa acquired CyberSource, Authorize.net's parent company, for a mere $26 per common share, or roughly the equivalent of $2 billion dollars.  It should prove to be a wise investment for Visa, and perhaps a source of angst for the competitors of Visa and Auth.net.

With this acquisition, Visa gains access to Google, Inc. and Facebook, Inc.  -- two behomoth websites with everflowing traffic.  Moreover, Visa will now further profit from e-commerce business, taking ownership of Authorize.net's 300,000 (and growing) accounts.  Indeed, merchant account experts are noting that Visa just picked up 25 percent of Internet market share -- keeping it away from third party processing powerhouse, PayPal.

This deal underscore's Visa's realization that e-commerce will continue to expand globally and that a prominent payment gateway provides the perfect infrastructure to facilitate Internet business.  Authorize.net has name brand recognition and a Visa - Authorize.net gateway may appeal to even more merchants as some business owners may feel a sense of reassurance going with a product, owned by a ubiquitous, easily recognizable American global payments technology company.  In essence, Visa's  profit centers will expand: It will continue to accrue cash flow from interchange fees paid by credit card processors and now receive direct and ancillary profit from its new payment gateway division.

Moreover, Visa will piggyback on Cybersource's ever burgeoning expertise on fraud prevention.  Cybersource has extremely advanced software analytics and a well of knowledge on e-merchant data.  Visa will benefit from Cybersource's leading role in Internet fraud prevention and be in a better position to manage e-commerce transactions.

The news of the Visa Authorize.net merger received its share of criticism -- primarily eminating from Authorize.net's competitors.  They cite a conflict of interest as Visa's PCI Security Standards Council must oversee all processing-related companies.  Monopolistic concerns center on the fact that Auth.net may obtain "trade secrets" on how to curb e-commerce fraud as all companies must report how they store data electronically.  Moreover, will the council's scrunity be greater for Auth.net competitors?  Such competitors may be undermined and not so readily receive compliance approval (i.e., acknowledging that they are managing and storing data safely).

How does this partnership affect Authorize.net merchants?  CyberSource’s president and CEO, Mike Walsh,  writes: “In the near-term nothing will change. The way you work with our company and partners will remain the same, as will our commitment to deliver the highest quality service and support."

Mr. Walsh adds that Authorize.net merchants can expect greater security measures to reduce the possibility of fraud, an enhanced platform to sell on a global scale, and an increased array of products and services, stemming from additional partnerships in the future.

Let's just hope that the cost for Authorize.net or credit card processing does not (dramatically) increase under the new Visa Authorize.net regime.  

Telephone credit card processing is becoming more popular and wCharge hopes to lead the bandwagon

All iPhone, Blackberry, Android phone users, or anyone with a mobile browser, listen up: Telephone credit card processing is only a few clicks away with wCharge – an application that is starting to galvanize a lot of interest among folks who wish to accept credit cards.  Combining simplicity and affordability, wCharge enables merchants on the go to easily, quickly, and cost-effectively receive their customers’ payments.

Here’s how it works: The merchant first signs up with a third party processor, such as PayPal, or with a merchant account provider, such as IntelliCollect, to obtain the wCharge application.  This application is eventually installed on the merchant’s mobile device.

The merchant first inputs his/her telephone number and pin number via the touch tone buttons on the phone – the same information that was registered with the credit card processing company.  It is essential to input the pin number or you will not be able to proceed to the next step – inputting the customer’s credit card information.  Before leaving the setup screen, you can also complete the “default description” field – i.e., a description of what you’re selling or service you’re offering.

Press “Save” and it’s on to the main menu screen where you’ll be able to perform the actual telephone credit card processing.  Here, you input the customer’s credit card number, expiration date, CVV2 code (the extra 3 or 4-digit number on the card), and the total amount of the sale.  

Press the optional button and you will be able to key enter the following fields: E-receipt which will send a copy of the transaction to the customer’s email address, customer’s name, billing address, zip code, and the description of product or service, if one was not provided on the setup screen.  (It’s particularly important to indicate the zip code to help prevent the transaction from downgrading to a higher rate.) 

Once all the information has been inputted and submitted, the merchant then receives the following confirmation fields (assuming transaction approval): Authorization number, date of transaction and time, the amount of the sale, the last 4 digits of the credit card, the customer’s name, and e-receipt address. 

The wCharge application also enables you to view the last 50 transactions.  If there is a particular transaction that must be refunded, you highlight it and then indicate that “Yes,” you do want to credit the amount back to the customer.  Once again, you should receive confirmation that the refund went through.

Any merchant on the go should appreciate the system’s ease of use and relative modest cost.  There are merchant account providers who offer wCharge at no initial charge where the monthly fee is typically anywhere from $5 to $20.  It is a viable alternative for business folks who do not process a great number of transactions.  Such individuals may not want to allocate a lot of money on an expensive wireless machine and open a more costly wireless merchant account.  Telephone credit card processing may be a perfect solution in this scenario, particularly as multiple phone numbers can be tied into one account.

(For those who anticipate a lot of transactions, it may be a better idea to go the wireless merchant account route, and take advantage of the lower swiped transaction rates.  Remember, when you swipe a card, it’s always cheaper than keying in the customer’s payment information.)

wCharge reviews have been primarily favorable and those in search of affordable telephone credit card processing should consider this program.  Review it yourself, weigh the costs vs. benefits, and you may just decide to accept credit cards by phone via wCharge.