Changes to the card network regulations are coming. All merchants are required to be PCI compliant at all times. Card networks have mandated that all credit card processors report every merchant’s PCI compliance status starting January 31, 2017. Previously this was only required for the larger level 1, 2, & 3 merchants.
Additionally, merchants that qualify for the Technology Innovation Program (TIP) by processing with EMV or a validated point-to-point encryption solution will not be required to validate their compliance.
Obviously this is the big banks method to completely put the burden of charge backs and fraud on the backs of the merchants. Merchants will pay more to accept credit cards at the point-of-sale. While the banks make gazillions of dollars, merchants bear the burden of ever increasing fees and expenses to accommodate credit card processing all while being completely responsible for any losses do to fraud.
PCI compliance is an impossible standard to accomplish. Even the most dedicated merchant cannot meet the the standard as set by the credit card industry. Now PCI compliance and EMV will be required to keep your costs down and liabilities at bay.
So what can you, the merchant do. First and foremost don’t bear the burden of all the endless fees being imposed upon you. Pass those fees thru your POS system to the card holder. Focus POS can easily add the cost of credit card processing to the customers guest check. New Mexico POS has programmed a number of our Focus POS customers to do just this. Reports from the business owners have all been positive reporting very few complaints from customers and no loss of business as a result of having Focus POS add credit card processing fees on each and every guest check used for credit card processing. Customers just pay the fees!
Here are the numbers. $1,000,000 sales, 80% credit card sales and average 20% credit card tip. Credit card fees, compliance costs and added liability insurance costs average 3% of sales plus tips. The math is:
sales x .8 = cc sales, cc sales x .2 = tips, cc sales + tips = cc total, cc total x 3% = cc fees
$1,000,000 x .8 = $800,000, 800,000 x .2 = $160,000, $800k + $160k = $960k, $960k x 3% = $28,800 fees
Think of what it costs you to pay the credit card industry $28,800 in credit card fees. If you are an extremely well run business and gather a 10% gross profit on your bottom line, you require $288,000 in sales just to pay those fees. Wouldn’t you rather put $28,800 to your bottom line than give it to the big banks?
Focus POS and New Mexico POS with this one feature can put profit back in your business again.
Call for a demo (505-293-7551) to see this beautiful feature of Focus POS!