As a veteran in the merchant account field with over 10 years experience, I have yet to see one "opting out" program that any given merchant truly needs. While benefit can be derived from any initiative, it should be up to the merchant to decide whether to enroll; inaction by the merchant should not constitute agreement of the new program's terms.
Perhaps I should not assume that you know what I mean by opting out programs. In this context, it simply means that a vendor is introducing a new program or resource, and it's the customer's responsibility to contact the vendor if he/she does not wish to particupate. Should the customer not respond and explicitly decline the "invitation to enroll," he/she will be enrolled automatically and billed a new fee.
It's easy to see how such a system is completely favorable to a company that implements it. Indeed, an opting out program can result in a financial windfall for that company ... at the expense of customers. Many folks do not read business-related letters in their entirety. As such, customers may not even know about a new program and thus won't know to call or write to cancel its impending terms. Others may be aware about the new initiative but don't understand that they have to take action to avoid incurring an additional cost. Still other folks plan to contact the vendor to ensure that they're not enrolled but may forget to do so. (There is always a deadline to cancel an opting out program, and in order to avoid at least that first charge, folks have to respond by that date.)
Recently, even I was affected by an opting out program. One of our merchant account parent companies (who we no longer use) instituted an opting out program. Fortunately, we don't have many customers in that portfolio, but now I feel it's my duty to tell them that they have to contact this provider directly if they're not interested in enrolling. I've called four merchants thus far, and three did not even know about the opting out program's existence. Needless to say, they were grateful that I reached out to them.
I'm truly miffed that this provider has taken this action. It's completely unfair, if not unethical, to institute an initiative where it becomes the merchant's responsibility to opt out. While I understand the provider wants to share information about a new program, the assumption should be that if any given merchant is interested in it, he/she will reach out to the provider. Failure to touch base with the provider and actively decline the offer does not mean the merchant is interested in program enrollment.
In order to avoid incurring an unnecessary expense, read all information the provider sends you. While you may think it is just junk mail, it can have an adverse affect on your wallet should you just throw it out. Moreover, read all verbiage on your merchant account statements, including the small print. You really have to become an educated and enlightened consumer.
While I've heard by merchant account insiders that an opting out program is an acceptable business practice, it's unacceptable to me and to the merchants that I've spoken with about this issue. There is a certain amount of fairness and integrity one should expect in all business relationships.
Many businesses start to see a spike in their sales during the Holiday season so I thought it would be instructive to provide 7 quick, useful credit card processing tips:
1, It's always important to exercise caution when accepting credit cards, but use even more due dilgence when you receive an order that is well above your average ticket or especially above your highest ticket. If an order seems almost too good to be true, it may be a worthwhile expenditure of time to reach out to the customer before delivering the item. Some merchants even request the customer to offer proof of address and/or a driver's license, for example, when facilitating a high volume purchase. Obviously, you need to be respectful of your customer's time and privacy but you always have be on alert for potential fraud as well.
2. Online merchants should strongly consider using AVS and CVV fraud preventative options -- particularly during the Holiday shopping season when incidents of fraud tend to escalate. Some businesses will only ship out merchandise to the card holder's address, confirmed with an AVS match. The customer should also be able to provide the exact CVV2 code found on the back of a credit card, proving that he/she has the card in hand. Once you decide to ship out product, you should receive signature on delivery.
3. Review your specified processing amounts (monthly volume, average ticket, and highest ticket) which you may have indicated on your merchant account application (assuming the processor has agreed to cover such limits). In order to minimize any problems with your processor's risk department, touch base with them as soon as possible if you exceed the aforementioned limits. You don't want your funds to be held, if at all possible -- particularly at a hectic time when cash flow is crucial.
4. Retail merchants should strongly consider the use of a manual imprinter when keying in transactions. In the event that a customer's magnetic stip cannot be read, you want to have proof that the customer authorized the transaction. If you don't have an imprint of the customer's card, and that customer decides to charge back the amount, you can very well lose the chargeback dispute. (Manual imprinters are cheap and your processor should be able to provide a complimentary encryption plate.)
5. Spend time ensuring that your credit card processing equipment, if applicable, is functioning well. You don't want to experience any downtime and lose potential sales. Too many retail merchants also forget to perform a quick inventory and assessment of their terminal paper, ink, and ribbons. Remember, if you receive a retrieval request or chargeback notification, you have to provide a clear, legible copy of the sales draft.
6. Before batching at the end of the day (whether or not you use automatic batching), it's vital to review your sales as you or your staff may have committed administrative glitches along the way. You don't want to pay a discount percentage and transaction fee on an amount that was incorrectly inputted. Moreover, you don't want your customer to become disgruntled over an erroneous charge and even risk a chargeback. If you find any errors, address them before batching: void the transactions and reprocess.
7. You have to avoid any data breach, at all costs, as you can be subject to fines and penalties, legal fees, reimbursement costs, etc. Contact your provider to make certain that you'e PCI compliant or outsource all aspects of payment card processing to PCI compliant vendors. You have to consistently ensure that you're compliant and this necessity is underscored during the Holidays when fraudsters target small merchants with even greater gusto.
By following the aforementioned tips, your Holiday business season will be a safer, more profitable, and happier one.
I've highlighted the IRS reporting mandate in an earlier post, compelling merchant account providers to report their merchants' gross annual credit card processing volume. Of course, between friends, this amount does not necessarily reflect any given merchant's true total amount in gross earnings, as other forms of payment may be utilized. However, in an attempt to widen a net catching anyone who underestimates their income levels, the IRS reporting mandate was passed. (I had no say in this legislation or a different result would have materialized.)
Now as a result of this regrettable IRS reporting mandate, your processor must complete a 1099 Form. The information provided by the processor must duplicate what the IRS has on file. Fields such as the name and address of the business, tax identification number, etc. must provide an exact match to IRS data. This is a concern because when both sources of information are compared, even space and letter case sensitive discrepancies may flag a mismatch. Moreover, a problem arises if a merchant has not provided the processor with his/her tax identification number (using a social security number instead) and the IRS has such a number on record.
A mismatch may open the proverbial Pandora's box. Indeed, if information discrepancies are not corrected, 28% of the merchant's credit card processing sales will be held until the errors are fixed and an exact information match materializes. Compounding the problem is the fact that the merchant will not be able to obtain any held funds until the end of the year.
As a result of these dire consequences, processors will be diligently and carefully filling out these 1099 Forms. Subsequently, they must reach out to merchants when any given mismatch arises. (Now it's easier to understand why many merchants are being charged an IRS reporting or regulatory fee as form preparation and communication with merchants becomes very labor-intensive.)
Merchants, too, can be proactive and call processors to ensure that their processor's information matches the IRS records. The problem is that many merchants are so busy operating their businesses that they may not even know the potential minefield that can blow up due to data discrepency.
Fortunately, not all merchants have to worry about this potential problem -- particularly those with low volume. Indeed, processors do not have to file a 1099 form on any merchant whose annual credit card processing volume is less than $20,000 and whose total number of transactions is less than 200.
However, the vast majority of businesses will be affected (and some adversely affected) as a result of the IRS reporting mandate. This 1099 form thus becomes an important document and an exact IRS match becomes crucial. If you don't call your processor, at least be accessible to them so you'll be able to provide the "right" information.
After conducting exhaustive research, you're ready to sign on the dotted line with your selected merchant account provider. You may feel a twinge of nervousness as you've read about some problems that others have encountered with processors, but accepting credit cards is a necessity and despite any potential risks, you forge ahead. However, by reviewing the following points and understanding merchant account basics, you will mitigate many of the difficulties that often come to the surface when swimming in the (sometimes) murky waters of the merchant account field.
1. On the merchant account application, you will be asked to indicate your monthly volume, average ticket, and highest ticket amounts. Many business folks have trouble determining these figures -- especially new businesses that don't have any sales track record. Despite the fact that you may just be using pure conjecture, you must OVERestimate these amounts (within reason).
Consider this scenario: You indicate that your highest ticket is $500. Several months later, you receive notification that a hefty $1000 transaction went through. Regardless of processor, this transaction will red flag and funds will be held indefinitely. You'll then have to work with the processor's risk department who may ask you for a copy of the invoice, confirm the transaction with the customer's card issuing bank, and/or require bank statements. At that point, the processor may or may not release funds. (Many processors hold funds up to 6 months, and even longer, but this is on a case by case basis. Indeed, your processor may be able to release funds within a couple of days -- again, based on your unique set of circumstances.)
In order to avoid this scenario, OVERestimate this high ticket. Similarly, it is best to OVERestimate your projected monthly volume. Again, funds may be held if you go over the amount you specified on the application. You may argue, "Isn't the processor penalizing me for my success?" No, you have to remember that processors do not want to take the risk that the unanticipated additional funds will be charged back. Processors are concerned that in the event the merchant's bank account does not have ample funds to cover such chargebacks, they will be left holding the proverbial bag.
The primary negative in OVERestimating the monthly volume, average ticket, and highest ticket is that the higher these amounts, the more financial information you may have to provide. Moreover, the underwriter may approve your account but not for the amounts you indicate on the application. It's then up to you to determine whether you want the account or not for the agreed upon limits. I just want to highlight the third rail of merchant accounts: Do NOT go over the processing figures you specify on the application.
2. You are responsible for ANY and ALL chargebacks. If a customer disputes a charge, you should receive notification about the dispute, and you must respond in a timely manner. If you fail to respond, you will automatically lose a chargeback.
Furthermore, when you close a merchant account, you must understand that you’re still responsible for any chargebacks that take place afterwards. This is why merchant account providers require merchants to keep their bank account open for a year or two after the merchant account is closed.
3. By signing an application, you are basically acknowledging that you're responsible for any such chargebarks. Moreover, you are acknowledging that you're responsible for any unpaid processing-related expenses. Indeed, you're signing that you're going to abide by the Terms and Conditions, and by providing your John Hancock in the Personal Guaranty section, declaring that you're going to assume any responsibilities related to chargebacks or other processing-related fees.
Some processors may waive this Personal Guarantee requirement but only if the merchant is running a non-profit or charitable organization, or owns a long-standing business with extremely solid financials
4. Always ensure that you have ample funds in your merchant account bank account – an obvious merchant account basic. If you have a low or zero balance, and you're assessed a processing fee, you won't have enough money to cover the expense. You'll be hit with an equivalent NSF fee, and worse, such rejects may give cause for the provider to close your account, and again, hold any funds indefinitely.
Another option that your processor has in handling frequent rejects (and chargebacks, for that matter) is to set up a reserve or rolling reserve. This is rarely done but it can happen. The processor may choose to hold back a certain percentage of your processing deposits each month, for example, until all past rejects/chargebacks are settled and they're satisfied that you're back on solid financial ground. This is why all merchant account terms and conditions include discussion about reserves. (Even an initial reserve may be set up as a condition for application approval. Again, this is not a common occurrence.)
5. Check the fee structure on the application to ensure that all the rates quoted match. Policies, such as no termination fee, if promised, should be explicitly written on the app. You should contact your agent if you notice any discrepancies.
6. Please abide by the terms and conditions. You not only have to be honest with the information that you provide on the merchant account application, you have to follow through by complying with the stipulations. For example, I've seen folks get in trouble by letting a friend use their merchant account even though the friend's business is a total separate entity. (If the friend gets a chargeback, the processor will call YOU, and you'll be held responsible. You can only process for the business that you indicate on the application.)
7. Here is another merchant account basic: Understand the importance of PCI Compliance -- guidelines introduced by the Payment Card Industry (PCI), known as the Data Security Standard (DSS). All processors and merchants who process credit card transactions must provide adequate security to the credit card holders’ data, so that the data cannot be misused. Of course, all backend networks must also be secure to reduce or eliminate the chance of fraud.
All merchant should ensure their own compliance with these guidelines. At the very least, merchants are required to complete paper or online questionnaires, revealing how they store, manage, and transmit data. It is recommended that merchants call, or better yet write their processor, to ensure that they are compliant.
One final bonus: I thought that I was only going to list 7 merchant account basics, but I thought that I should make mention of the fact that you should always have a contingency plan in place. If your processor closes your account or if you decide to close the account, have another option or two ready to go so that the transition to a new processor will be quick and painless.
However, please remember that merchant account approval is never automatic. An underwriter will evaluate your application based on several criteria, including your credit score, nature of business (some businesses are on the prohibitive list), anticipated processing volume, etc. Your credit score is particularly important and poor credit may preclude your application from getting accepted. (Your selected processor may provide the option for you to secure a cosigner with good credit which will increase the chance for application approval.)
The list above only highlights the most common problems in the merchant account field. It's not an exhaustive list, so please review your processor's terms and conditions – another bonus merchant account basic.
Well, these are the merchant account basics that I thought would prove helpful to any new merchant. While I've outlined some potential minefields, they're much easier to avoid now that you know about them.
Recently, I spoke with a colleague in the merchant account field who told me about the woes that one of his clients experienced. Apparently, the merchant swipes credit cards but, for months, did not realize that thousands of dollars had not been deposited into his bank account. Upon making this discovery, the merchant called him, inquiring about the missing funds. "I don't see one batch that has been deposited for the last six months," the merchant lamented.
The merchant's mood soured further when he found out that, indeed, no batches were settled (i.e., no funds were transferred into his bank account) and that all the customers' credit card information was no longer stored in the credit card terminal.
My friend told the merchant that while such credit card data could be unearthed, he would be ill-advised to put those transactions through. Indeed, many of the merchant's customers would no longer recognize the charges and, as a result, dispute them. A high threshold of new chargebacks could lead to other problems for the merchant, such as the possibility of losing his merchant account and even being placed on a Terminated Merchant File (TMF) list.
The merchant's concern about the lost batch amounts turned to anger when he barked at my friend: "You should have told me that my system was not batching out." My friend explained to the merchant that he never requested auto mode where the funds automatically batch out from the terminal for settlement. Moreover, my friend relayed that even if the system was set up to automatically batch, any technical glitch could occur, and it's still the merchant's ongoing responsibility to ensure that the funds reach his bank account. "If you had brought this to my attention much sooner," my friend expounded, "I would have been able to resolve this issue."
The merchant has no legal recourse as well. He signed a contract explicitly stating that merchants must batch out the funds every day or face the following possible consequences: higher processing rates, delay in payment, and/or, as in this case, the inability to collect funds. In addition, all merchants need to notify the processor in an expedient manner when batch amounts are missing in action.
The moral of the story is that it is vital to batch out transactions on a daily basis (of course, only applicable on the days that you have at least one transaction) and then ensure timely deposits of those batches. Please do not wait any stretch of time (certainly do not allow six months to elapse) before you ask about any given batch capture / batch settlement issue. Remember this topic with a series of two words: batch out ... settle funds ... be happy.
There may be a variety of reasons merchants decide to close their merchant account: A seemingly better offer from another provider became too enticing; the present provider's fees began to escalate out of control; the present mode of accepting credit cards may not be convenient or prove too burdensome or problematic; the business may not truly warrant credit card processing capability; and/or the business may be sold or closed
Regardless of the reason, there are certain common points that all merchants should consider when closing their merchant account, outlined below:
1. It's best to give at least 30 days notice when closing an account, and many contracts demand it. However, your processor may decide to quickly accommodate your request to close the account without any time stipulation or penalty.
2. Before you close the merchant account, ensure that you have no pending batches. You want all your funds to be able to get to their rightful destination -- your bank account.
3. It's advisable to express your interest to close the account in writing. Typically, you can write a letter to the company, referencing your business's name and merchant account number, requesting to terminate your merchant account, and subsequently signing the document. Almost all providers can send you a standard cancellation form where you can just sign and return it.
4. Of course, ensure that your soon-to-be ex-processor receives it. Do not assume that if you fax the letter or form, the processor received it. Always check to make sure that the information was received on the other end, and it's prudent to get receipt confirmation in writing.
5. Business folks who should not incur any cancellation or termination fee should underscore this point, and make certain that the processor acknowledges that no such charge will be assessed. Merchants who, by contract, must pay a cancellation or termination fee, should find out the amount and make certain that there are ample funds in their bank account to cover this expense.
6. You must keep your account open and accessible to the processor as you are still liable for any outstanding balance owed on the account. Even if your owe nothing to the processor, you must still have an accessible bank account should any future chargebacks arise. This protects you as well as the processor. You don't want to receive a collection notice, indicating that you owe funds from a chargeback that occurred after you closed your old merchant account and bank account. (Typically, you'll be asked to keep your account open from at least 6 months to 3 years.)
7. You will still receive a statement the following month from the old processor. For example, if you closed your account the first week of August, you should anticipate receiving a statement in September, reflecting your August transactions. You should not receive any statement in subsequent months.
By knowing and following the principles outlined above, the merchant account closure process should be much smoother and easier. It should eliminate any typical problems associated with closing a merchant account.
Controversy continues to swirl around the all-important debit fee as various factions have strong opinions as to price control regulation itself and the actual cost of swiped debit cards. Consider the following points:
Banks / cardholding associations - We are against all measures that regulate the fees that we charge. This form of price control will only hurt our bottom line which will prove to negatively financially impact our customers. In addition, smaller banks and credit unions who are exempt from this type of regulation may not be able to compete with their larger counterparts as merchants start discriminating against accepting higher priced debit cards.
Retailers / merchant associations - Large and particularly small businesses cannot absorb high debit fees. We are just trying to make a living and exorbitant processing-related costs take a big bite out of our profit. We're particularly getting killed on small ticket items (less than $10) and some of us have already decided not to accept plastic. Moreover, with a lower debit fee, we can pass off some savings to our customers.
Customers - While we want to pay less at the stores we patronize, we don't want to have to pay for lowered debit fees in other ways. In other words, we don't want banks to stop giving us free checking accounts, eliminate rewards on debit cards, or pay a higher annual fee or credit card interest to make up for any diminished bank profit margin.
Politicians, such as Senator Richard Durbin - We want debit card fees to be “reasonable and proportional” to the actual cost incurred by banks to process the transactions.
Well, words like reasonable and proportional are subject to interpretation and open to debate. Such debate and lobbying blitzes have taken place over the last half year, culminating in the decision rendered by the Federal Reserve on June 29th. Here are the major provision of the Fed's ruling:
A. The swiped debit fee will be set at 21 cents + plus 0.05% of the transaction amount;
B. The banks will also be allowed to collect an additional 1 cent on each debit transaction to cover the cost of fraud prevention if they meet certain fraud preventative standards.
C. Debit card issuers have to support at least two unaffiliated networks, such as one PIN and one signature network. A card with only PIN or signature capability will have to have at least two unaffiliated networks. Merchants have the freedom to choose which network to run transactions through.
D. The aforementioned provisions only affect institutions with assets more than $10 billion and go into effect this October 1st.
Although bank officials yearn for the pre-regulation days, they must have heaved a collective sigh of relief as the debit fee cap was originally slated at 12 cents. Still, 21 cents represents over a 45% reduction to the current, average 44 cent debit fee. Retailers conceded that the Federal Reserve took steps in the right direction but, in their estimation, the Feds did not go far enough. I suppose that they were tantalized by the initial 12 cent cap. Visa and MasterCard's stock went up as the ruling was considered less draconian from their point of view.
Merchants who are on the Interchange cost plus model will already be covered when the new debit fees are instituted. Those merchants who are on a tiered cost program will wait and see how their processor implements any new debit fee structure. (Some processors may decide not to lower the debit fee rate. Of course, retailers are then always free to switch to a processor who will.)
I'm receiving a proliferation of calls from merchants who need mobile credit card processing and do not want to invest in costly wireless units. Many merchants feel that they've invested a lot of money for their smart phones and that viable processing solutions should be directly available through such expensive hardware.
I just received a call today from the proud owner of a $600 Android who exclaimed: "I've invested a small fortune for this phone. Don't you think it should come with all the bells and whistles, including the ability to accept credit cards?" I responded, "Ah, it very well may provide the perfect foundation to process credit cards as long as you avail yourself to ROAMpay.
Indeed, ROAMpay provides a specialized application to accept credit cards, and even has a concomitant reader for business folks who need to swipe their customers' cards. Of course, ROAMpay is not compatible with all phone units, but the number seems to be growing daily, and includes units such as the Blackberry, Android, iPhone, iPad, and even other types of mobile devices, such as PCs and MACs. Roam Data, the company that has rolled out such impressive technology, offers a list of supported phones. Here, you can see which phones may be used in conjunction with the swiper to swipe credit cards and which ones work with the ROAMpay application to key in credit cards.
If you're excited about the prospect of turning your mobile device to a POS unit, you should first examine a merchant account provider that resells ROAMpay. Of course, evaluate the full scope of fees, including the additional ones assessed as a result of using ROAMpay. Once you make your selection, the processor's technical department can build the necessary files to make ROAMpay's system complete and functional. The shipping or deployment department can also send a reader for merchants who need swipe card capability. (You'll eventually connect the reader to the headphone jack.)
Downloading the application is a snap and you should be able to access it in no time, inputting your secure credentials. You'll soon be ready to accept your first credit card.
First, indicate that it's a credit sale, then input the amount of the sale, and if applicable, you'll then indicate that it's a swipe transaction. The customer's truncated credit card information will then appear on the screen. Subsequently, you'll be able to write notes, if you wish, about the transaction, and email a receipt to the customer.
You'll then submit the transaction for authorization. Let's assume it's a successful transaction ... sold America! The funds then get deposited into your bank account.
Of course, ROAMpay allows merchants to perform other actions aside from processing credit cards. Voids and refunds can also be facilitated through the system, and cash transactions may be run and recorded as well. The system has store and forward capability and offers transactional history reports.
ROAMpay is a useful, comprehensive tool, but I wish that it would automatically include a printer to print receipts. However, you can purchase a separate printer to accomplish this task, and as a reminder, receipts may be alternatively emailed.
Merchants on the go (plumbers, electricians, craft show merchants, etc.) -- particularly folks who already have smart phones -- should investigate the smart technology that ROAMpay offers.
(Warning - Promotion Declaration: Our merchant account company is offering a "25-25 roampay deal." Here, for a one-time activation fee of $25, and less than $25 per month, you can get your mobile unit to accept credit cards. The monthly fee includes roampay, PCI compliance, and the statement fee. We're selling the reader for $45 + shipping.
Please call (973) 448-9701 or email, info@intelli-collect.com for details and complete pricing on our merchant roampay account.)
One of the most important commandments in the field of legal practice: Thou shalt not commingle funds. Indeed, property or financial assets belonging to clients or third persons in possession of an attorney must not be placed in the attorney's bank account. Occasionally, news stories report of a lawyer's illegal financial exploitation, dipping into prohibitive accounts or depositing funds that are slated to go to an escrow or trust account to his/her own account.
Hence, I receive the occasional phone call from attorneys who wish to use two separate accounts -- one for operating expenses and another representing a trust account. Specifically, attorneys may need credit card processing-related fees deducted directly from an operating bank account and any deposits to go directly to the trust fund account. Can this be set up under one merchant account?
While policies vary between merchant account processors, there are providers who will enable the merchant to set up one merchant account. Under the umbrella of this merchant account, the provider makes deposits to one bank account and withdraws fees from another. On the merchant account application, the lawyer should notate the account information for deposits and withdrawals, and provide a voided check or bank confirmation letter for each account.
This type of system (i.e., one merchant account for two separate bank accounts) can be set up whether the attorney swipes the client's credit card payment or keys it in, or even accepts payment online.
The question arises: What if the attorney has both operating account deposits AND trust fund deposits? In this scenario, most processors would then require two separate merchant accounts. Here, the lawyer would be able to designate which account he/she wants deposits to be sent to and credited. Basically, for each merchant account, there can only be one bank account designated for deposits. It would be up to the lawyer to determine which merchant account he wanted to use for the specific deposit account.
As we're all familiar with the separation of church and state, attorneys have to embrace the separation of operating and trust bank accounts. While it's possible and ideal to set up one merchant account ensuring attorney "no commingling" compliance, it may be necessary to set up two or more merchant accounts if the attorney has different types of deposits and/or many different trust clients.
I have about a decade of experience in the credit card processing field and although the merchant account niche can be volatile and unpredictable, I can draw several universal truths, including the following: Each time the processors are given additional responsibilities and requirements -- be it from the card holding associations or from government -- many will defray the costs of such mandates to the merchant. Agents, such as myself, are then saddled with the unenviable task of bearing the news of increased rates to the merchants, although we don't make any additional commission from the new fees. Moreover, while the processors are facing additional costs due to regulatory intervention, the suspicious question arises: Are they using it as an excuse to amass profit?
Consider the omnipresent PCI compliance fee. There's no doubt that definite costs are beared to secure backend networks, perform scanning, complete administrative work, and educate merchants (some companies have their own PCI compliance departments). But the range of PCI compliance fees vary widely. Some charge annually; some monthly; and some assess both monthly and annual PCI fees, and the total PCI-related cost can range from about $50 per year to well over $200.
Similarly, when legislation was passed in 2008 mandating processors to report merchants' gross income, starting in 2012, I cringed: I knew that such legislation would not only impact merchants but also processors. It was almost a foregone conclusion that additional administrative and recordkeeping responsibilities beared by the processors would translate into what we now call an an IRS Reporting Fee.