The Pellucid Perspective - September 2015 - (Page 10)

golf course operations Payment Processing: Are you confused? By stuart lindsay M any of you know that we spend time researching new tier rate, but if you look at the Visa USA Interchange Reimpayment trends to try and keep our clients informed bursement Fee Schedule from April 18, 2015, you will find that on the developments that affect how they get paid and all mid-qualified loyalty cards do not carry the same rate. The how much it costs them to accept non-cash payments. It seems same is true for government and corporate cards. that every time I look into the murky world of payment proWhen it comes to Debit cards, the situation is even more cessing, I find more ways that card issuers and processors are complex. While Debit/PIN transactions supposedly have transmaking it difficult for golf courses to get transparent explana- action fees capped by the Durbin Amendment to the Doddtions of options and charges for these services. Frank Banking Bill, those regulations only apply to debit cards As the October 15 deadline approaches for rule changes issued by the largest banks. Debit cards issued by community regarding the acceptance of EMV "smart cards," payment banks, credit unions and smaller regional banks are "exempt" processing is becoming more complex with the rollout of Apple and Visa/MasterCard are still allowed to charge "interchange" Pay and other mobile payment options that are being added on debit cards affiliated with the Visa/MasterCard brands. The into the mix available for golf courses to receive money from interchange rate is about 20% lower than for a credit transactheir customers. tion, so a golf course can definitely still save money by finding a Based on the questions we get, our clients are more than a little confused. It appears that most golf courses are simply depending on their current processors to keep them compliant and advise them on what they need to do. That is certainly the easiest approach, but they are most likely going to end up leaving a lot of money on the table. We have already seen one release from a leading POS vendor indicating the difficulties of getting timely "certifications" for integrating these new terminals into their POS software. As we said in our 2015 State of the Industry report, there are literally thousands of payment alternatives being developed - Level Up, Venmo (Braintree), CurrentC and others. Some involve traditional MasterCard/Visa payments, while others such as Chase "Quick Pay" offer transfers between individual bank accounts at no charge. Ordinarily, we would all of us basically understand that encourage our clients to make it as easy as possible accepting credit cards (and paying the for customers to give them money, but how many of these options are really necessary and how much processing fees) is a necessary evil. will they cost? All of us basically understand that accepting credit cards (and paying the processing fees) is a necessary evil. As merchants, golf courses also have additional merchant services vendor that offers true Debit/PIN processing. issues - supermarkets, hotels and fuel vendors are treated differThen there is "Signature Debit." Not all merchant services ently and are mostly given preferential "interchange" rates that vendors can offer true Debit/PIN processing, so the processare not available to small merchants. In addition, any of you ing industry came up with this euphemism that basically treats who have shopped processors know the games that are played debit cards as credit transactions. It's also interesting to note with "rate," transaction, batch and statement fees. Most of you that the Visa interchange rate is higher for "Signature Debit" also understand the different "tiers" of qualified, mid-qualified than it is for a qualified credit purchase - go figure. and non-qualified transactions. As for the processors who tell you that you need to jump on The first problem is that merchants have no control over the the mobile payment bandwagon, golf courses should be very type of plastic a golfer tenders for a purchase. If a customer ten- careful. Apple has been very careful to try and keep their "cut" ders a mid-qualified loyalty card, you end up paying a higher in- of each transaction secret, but they are taking a small percentterchange rate. Most processors give you a basic "mid-qualified" age of every purchase. Not surprisingly, the interchange rate for 10 The Pellucid PersPecTive September 2015

Table of Contents for the Digital Edition of The Pellucid Perspective - September 2015

EZLinks acquires GolfSwitch
Youth on Course provides win-win for golf and juniors
Breaking News: Golf is getting passed in technology and information use by...farming
Private clubs struggle to combat the “equity club death spiral”
Payment Processing: Are you confused?
August golf weather impact: Weather and stocks decline
Price is right, but demand still lags in Tampa
Is golf doomed to rely only on ‘aspirational’ golfers?

The Pellucid Perspective - September 2015