Remote Banking. PayPros 8200 Central Avenue Newark, CA 94560

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1 Remote Banking PayPros 8200 Central Avenue Newark, CA 94560

2 What is Remote Banking? The way you communicate with your bank from a remote device. Phone Internet

3 How does Remote Banking play a role in your model today? Presentation today is to provide an overview of the most efficient way of accepting all forms of electronic payments and physical checks.

4 What are merchant services? A financial services company that enables businesses to accept electronic payments: Credit Cards Debit Cards ACH Automated Clearing House Gift Cards Loyalty Cards Check Conversion Services

5 Different business models of delivering merchant services. Local Banks Aggregators Transaction Acquirers Full-Service Processing & Technology Providers

6 Who provides merchant services? Local Banks SunTrust, Wells Fargo Aggregators PayPal, Square Transaction Acquirers First Data, Bank of America Full-Service Processing & Technology Providers PayPros

7 Local Banks Sun Trust Bank First Data 6598 Edgewater Dr 7305 Pacific Street Orlando, FL Omaha, NE Cons Merchant services and customer support provided by a third party. Cross collateralization. Pros Trusted resource. Familiar interaction.

8 Cross Default Clause A bank has the right to deny access to balances in any or all loan accounts to a borrower (with several loans at the same bank) even if only one loan goes into default. A bank can apply all available balances in all accounts of the borrower to satisfy any loan in default. Removal of liability at no additional cost.

9 Aggregators (i.e. PayPal, Square) An aggregator model is designed to deliver merchant services with infrequent electronic payments. This infrequency results in a higher transaction cost. Common merchants: Ebay seller. Limo service. Small business owner. Cons Withholds funds; lengthy wait for deposits. Not a cost-effective solution. Pros Don t have to apply for a merchant account. Quick startup.

10 Transaction Acquirers Provide merchant services and customer support. Cons Require a merchant account, credit check. Customer can feel like a number. Minimalistic data security strategy. Lack of solution technology. Pros Innate credibility. Wide range of service offerings.

11 Full Service Processing and Technology Providers Own, architect, and develop their own payments technology. Provide a PCI compliant solution. Provide merchant services. 24/7/365 in-house, typically domestic customer support. Underwriting authority. Often fully-integrated into merchant software.

12 Full Service Processing and Technology Providers Cons Not a banking institution. Often not a recognized brand. Pros Latest payment technology solutions. Provide services to merchants others do not. Single throat to choke. Eliminates ancillary payment fees.

13 How to minimize the costs of doing business. Understanding the rates and fees for electronic payments. Obtaining an efficient flow of monies. Mitigating risk exposure. Controlling the variables. Finding new sources of revenue.

14 Rates and fees for electronic payments. Interchange The fee that the merchant acquiring bank pays to the consumer card issuing bank. MCC transaction type codes. Method of entry. Card type. Effective Rate Total fees / deposits = effective rate (volume) Merchant Services Share

15 Efficient flow of monies. Credit Card Settlement hours. ACH / Check Settlement 5-7 days. Account Updater Service Approves transactions that would otherwise decline, due to changes in card information. Recurring payments Automatic billing cycle; results in consistent deposits.

16 Mitigating risk exposure. Eliminate the handling of cash transactions. Credit cards guarantee deposit of funds. PCI Compliance. Become PCI compliant and validated. SAQ completion. Invest in secure technology. Beware of out-of-scope solutions.

17 Mitigating risk exposure. PCI SSC FAQ Encrypted data may be deemed out of scope if, and only if, it has been validated that the entity that possesses encrypted cardholder data does not have the means to decrypt it. Encrypted transactions. Data breach reimbursement programs.

18 Controlling the variables. Method of entry dictates costs. Card present AVS Card not present Pin Debit CVV Identify method of entry being used and the appropriate qualifications. Manage on-time deposit.

19 New sources of revenue. Parallel payments Enables consumers to buy products and services from multiple vendors with a single checkout. Examples: Boxes and packing needs. Trailer and hitches. Rental trucks. Vehicle insurance. Content insurance.

20 Conclusion. Your Merchant Services relationship is critical to your day to day business operations There are multiple business types available in the market. There is a myriad of product and service offerings. The question is how do I choose the best one for me?

21 So you need to ask yourself Am I taking advantage of all the services that the industry offers that will reduce my cost of doing business? Have I recently explored business solutions that could make a positive impact on my business? Are my transactions safe and secure? Have I explored programs that can mitigate my risk?

22 Questions?

23 PayPros Contact Information