Personally I agree with Ken's logic on this one.
1. Anyone doing a high trans volume is going to get smacked on cb's, especially if credits are counted in the same penalty column.
2. Most of the major programs have tried running on their own accounts at some point, I can't think of one that's done it without losing accounts and having issues with Visa compliance. It's no secret that Martin Elliot's mission in life includes putting some people out of business because he doesn't like them.
3. Sites that are running high cb ratios -- especially in proportion to other clients in the IPSP portfolios, are aware that they are doing this -- it's one of the reasons they go thru an IPSP -- so they are not terminated, which they would be on their own accounts, or at the very least put on the monitoring programs and having to pay their own fines.
4. Using an IPSP and running high cbs is still a better risk management strategy, including paying the fines, than having your own merchant account and running at these same levels -- at least with an IPSP you have someone who can go to bat for you with compliance if you run into a problem that would otherwise cause massive issues with your own merchant account.
If some of these lawsuits don't bear fruit and Mastercard in particular is allowed to carry on the way they have with credits and cbs and fines, I think you will see ALL the IPSPs going to this model. They will have no choice, since at the end of the day they have to stay in business.
It's no good for anyone if a single IPSP goes down, it only makes it harder for the ones that remain in business.
|