Today, a variety of options are available for business owners in the case of payment technology. For accepting credit/debit card payments, there are a variety of ways. That’s how you can understand what type of merchant services are suitable for your startup or business. Every business, whether it is small or big, has specific needs. Therefore, it is essential for your merchant payment processor to meet these specific needs in order to grow a successful business.
To expand your business safely and securely, it is important to understand various types of services provided by merchant service providers.
Table of Contents
- What does it mean by an ISO or Independent Sales Organization?
- Understanding an ISO or Independent Sales Organization
- Is It Safe For a Business To Work With An ISO?
- What Does Merchant Services ISO Include?
- How to Evaluate an ISO?
- Flexible Invoices and Online Payment Gateways
- The ISO Must Have the Hardware
- Know Your Transaction Volume before Negotiations
- The Bottom Line
What does it mean by an ISO or Independent Sales Organization?
An ISO is a company that processes third-party payments. Also, the Independent Sales Organization has the authorization to operate the merchant accounts of the businesses. In some situations, organizations such as ISO are unreliable and have a bad reputation.
Due to this, business owners prefer to opt for large banks to process their business’ payments and transactions. However, this preference does not work every time because banks are not that easier and flexible to work with as ISOs are. Also, ISOs are similar to banks in terms of providing security, safety, and structured services.
Understanding an ISO or Independent Sales Organization
Credit card associations are leading credit card companies such as MasterCard and Visa. These credit card associations are responsible for setting up interchange fees, improving and maintaining card networks, and arbitrating between acquiring and issuing banks. Also, there are large member banks in the United States. The major association banks include Wells Fargo, Bank of America, etc. All of them accept payment transactions of MasterCard, Visa, and other credit card associations.
There is a special relationship between associate member banks and Independent Sales Organizations (ISOs). These banks support the ISO merchant transactions worth billions of dollars. In the meantime, ISOs handle the daily activities of the merchant accounts. These activities include setting up a merchant account, assistance with specific processing needs, and providing payment technology support.
Becoming an ISO is an uphill task. An organization or individual has to go through a difficult vetting process to become merchant services ISO. After all, they will be required to ensure legitimacy, security, and other strict security standards. After completing this process, the Independent Sales Organization (ISO) is sponsored and authorized by the association member bank.
Is It Safe For a Business To Work With An ISO?
As discussed earlier, a third-party organization such as merchant services ISO are preferred over banks for processing of payments and transactions. However, these large banks are less flexible and more expensive as compared to third-party companies that provide processing of payments. Also, they are more secure and safe.
An ISO allows each of its institutions to maximize their level of performance. As every institution focuses on a specific area, this helps them to perform efficiently. While banks only focus on vast and unique responsibilities, an ISO is always there to dedicate necessary resources and time to provide best-in-class merchant services.
They offer valuable services in areas where banks cannot – like rates, customer support, and technologies. If you are looking to opt for merchant services, then consider opting for an ISO. Make sure to do thorough research while keeping in mind the specific needs of your business.
Proudly, Host Merchant Services is an ISO. We deliver best-in-class payment solutions to every type of business. Also, our advanced tech solutions help in incredible savings and growth of the business.
What Does Merchant Services ISO Include?
Typically,the merchant services provided by ISO include:
- Online Gateways
- POS Software Systems
- Hardware Payments Terminals
- Credit Card Payment Processing
- Mobile Payment Apps Readers
- Analytics Programs and more!
How to Evaluate an ISO?
Here are some of the best practices you should keep in mind while evaluating an ISO:
Flexible Invoices and Online Payment Gateways
Today, eCommerce platforms and online sales are trending all over the world. Due to this increase in popularity of online sales, the need for flexible payment gateways is also increasing.
Imagine if a business has a partnership with an ISO, which provides them with a restricted payment gateway. It will negatively affect the sales of the business.
That’s why it is better to partner with an ISO that provides flexible online payment gateways and invoices. One way to check this is to see what third-party apps they are using to improve their UI and UX.
The ISO Must Have the Hardware
The first thing to ensure is that the ISO must have the hardware equipment that your business needs. Some ISOs do not create and supply their own hardware equipment. That’s why it is necessary that you select an ISO that provides the best and reliable hardware. This hardware equipment mainly includes payment processing devices.
Know Your Transaction Volume before Negotiations
Before negotiating with ISOs, you must know about the average transaction volume of your business.This is very necessary because it will help you in selecting an efficient and reliable ISO. Also, with all your budget needs upfront, an ISO can help you come up with a strategy to save money on your transactions.
In case the ISO offers you to check your business’ transactions volume and other analytics, then let them do that. It can lead to customized pricing for your business.
The Bottom Line
An Independent Sales Organization and a merchant services provider is almost the same thing. It is a 3rd-party payment processor that has a relationship with credit card association banks. However, an ISO and a merchant services agent are not the same. A merchant services agent may work independently or under a particular ISO.
They can help small business owners who are not able to open their merchant account directly with an acquiring bank. That is when ISOs open and manage the merchant account of a small business.
Host Merchant Services is an ISO. They provide their customers with various types of merchant services. If you want a one-stop solution regarding merchant services for your business, then contact Host Merchant Services now!