Advocate Wanted

While reviewing all of the “interchange” related legislation under consideration that directly impacts the paycheck of every ISO out there, it struck me that there is no single voice advocating on behalf of the ISO community. Think about it for a minute. ISOs close the overwhelming percentage of merchant contracts, place the lion’s share of terminals into the mom and pop retailers and maintain the largest number of relationship with merchants in the marketplace yet have absolutely no say in determining pricing of the very commodity they sell. Isn’t that strange?

Whether you know it or not, the Congress of the United States is proposing legislation right now to set pricing for access to the payment infrastructure. The proposals specifically exclude non-bank representatives from participating in price related negotiations going forward. You can rest assured that the bankcard associations, the banks, and the huge processing organizations all have paid lobbyists working diligently at representing their constituent’s point of view. Yet the ISOs have no voice.

Their best bet seems to be the ETA but the ETA is a registered trade association, not a lobby organization and represents a much larger constituency than just the ISO community. The ETA has to represent all of their members equally, which includes any company than participates in the electronic payments industry. I truly don’t have an answer here and the legislation in Congress is moving forward. It may be too late to do anything. But somebody may want to think hard and fast to come up with a solution. The ISOs very way of life may be at stake.

Paul Martaus