Bank Of America $5 Debit Card Fee

Bank Of America $5 Debit Card Processing Fee

Well we in the credit card processing world new it was coming before October 1st and Bank Of America has fired the first shot.  Bank of America is introducing a $5 debit card free which will undoubtedly anger its customers.
For those that do not already know, The Durbin Amendment which places a cap on what issuing banks can charge merchants to process debit cards.  Credit Card Processing can be very expensive for merchants and this is why you see minimums in some stores in order for them to accept credit cards from customers.  The legislation is good for small businesses and in turn will benefit consumers.  But what about the banks?  Are they the victims here?
Well if you follow credit card processing news headlines you would think they are being driven into bankruptcy.  Their credit card processing revenue has been estimated at near $19billion per year and they are out to recover their potential losses any way they can.  The announcement from Bank of America to charge a $5 a month debit card fee has been the most notable attempt so far.  Other banks have already done so but BOA has the most depositors and is a giant in the industry.
The fee is not as bad as it sounds because the $5 fee will only be assessed as a monthly charge is someone uses their debit card during the month and it is not a per transaction fee.  Transaction fees will be capped at 21 cents plus 5 basis points times the amount of the transaction and will be charged to the customer by the merchant.  At the point of sale this is a much better deal for consumers than they currently face.
The way to avoid the fee with BOA is quite obvious.  Don’t use your debit card.  It sounds a bit harsh but the truth is that these new bank fees will change the way consumers behave in the market place.  This fee will be imposed on top of any other checking account fees already in place.  Free checking accounts have all but disappeared as a precursor to this new legislation and bank customers have to pay more attention to their accounts than ever before if they hope to avoid the pitfalls of a la cart banking but perhaps this is something good.
The incentive here is to become more reliant on cash and let the big monster mega banks know how you feel by avoiding their credit card processing fees as best you can.  But for individuals who make lots of debit card transactions over the month, the $5 fee may prove to a blessing in disguise as they realize more savings at the point of sale.  We will have to wait a few months to see how this all shakes out but one thing is for sure, things are going to be different as far as credit card processing is concerned.

Use Credit Cards Instead Of Debit

Bank of America’s announcement to charge a monthly debit card fee last week has turned the credit card processing world on its head.  But for industry insiders this move has long been expected as banks try to recover the lost revenues no longer available to them as a result of the Durbin Amendment.The credit card processing industry will survive and somehow manage to find a way to become even more profitable.  It is consumers who are most bent out of shape by this move yet they shouldn’t be.  The big problem is that the banking industry has spent years teaching the public to become reliant on their debit cards but it was a mistake for consumers from the get go.

At first nobody really understood the differences between the debit and credit card processing fees and cost.  They only saw that banks were using gimmicks to encourage use and if done correctly, users made out like bandits.  There were no real debit card fees for most point of sale transactions but they were loaded with reward points which quickly added up to extra cash.  Some users earned hundreds of dollars per year using their card the same way they would use cash.  It made no sense to use anything but debit.
I myself chose to use a debit card to pay for dental surgery and received $53 back from my issuer at the end of that quarter which effectively gave me a discount off of my procedure.  Throw in groceries, gas and utilities and I was a debit card junkie.  Then came the increase in fees from merchants for credit card processing on small items like chips and gum.  It was then that I noticed there was a significant cost to using debit cards.
Now that rewards programs have come and gone, and the banks can no longer charge high fees for POS transactions, they are resorting to monthly charges on checking or savings accounts with debit cards tied to them, and turning to tricks buried in the fine print of their terms of service agreements to generate higher fees to replace lost revenues. Consumers need to be aware of this and stop using their debit cards when credit is an option.
Debit transactions are immediately taken from a users account which makes fraud a lot more difficult to deal with from a consumer’s standpoint.  Traditional credit card processing provides a much better challenge process and is much safer than using debit.  For someone who pays off their credit statements monthly so they don’t accrue interest charges, there are still plenty of cash back programs which make using credit extremely attractive.
Speaking of cash, why not use that? Cash still spends and many merchants offer discounts for its use because they pay no fees what so ever.  Cash may not be the safest thing to carry but using it is your least expensive option.  The real point here is that smart consumers need to be aware of the current, and upcoming, changes in the credit card processing industry

How To Choose Dog Carriers

Does your pet dog like running around your house? You can consider getting dog kennels for your dog then. Since oftentimes, you'd end up not knowing where they are and wish that you didn't just let them run around in the first place. It's like a fence where you can let your dog stay while preventing them from straying too much. It will definitely help and assist you to keep your dog in check.

Dog Crates come in different sizes and designs, which mean that some come in small or big kennels. If you are considering buying these for your dog, and then you'll have to think about how big it will be and where you will put it. The size is essential because if your dog is big, then you should get a size that will suit them since they'll need extra space to move around in. It is also important to think about where you'll want to put it because your dog might not be comfortable if it's somewhere in the garage. Usually, most people put it somewhere near the garage but on the grass so that the dog may feel comfortable.

Since dog kennels are like fences for dogs, it will usually be bigger so that the dog can run while inside it. That way, you wouldn't really have to worry about them if they're running inside it because you know that they're safe inside. Keep in mind that your dog's safety and well-being is a priority for most dog owners, which is why they get top quality items for their dogs' needs. Pet owners buy and get all the necessary items for their dog because they want to show that they care about them. Pets would often feel and know how their owners feel about them by seeing the things that their owners do for them.

Remember, in choosing dog crates for your pets, consider the quality of it and make sure that you're getting great quality because it'll be part of your pet's home. Place it around an area that they feel comfortable in and make sure that it's big enough for them to run around in. Also, make sure that it has a lock so that they won't easily get out of it and eventually stray. Remember, your pet's well-being is important which is why you should only consider choosing top quality kennels for your pet's needs.

Credit Card Processing Rewards

Recently most of the credit card processing news we have been hearing about has focused on the Durbin Amendment and the reduction of debit card fees.  As a result, banks are trying to recover their potential lost revenue by pretty much annihilating all the debit rewards programs which changing the way consumers handle their spending.
Debit card programs were so attractive to consumers at one point that they made more sense to use as opposed to cash.  Points and dollars were adding up so fast creating a too good to be scenario for consumers.  But just as that wave has come and gone, it looks like credit card processing just got a little bit interesting again.  We are seeing credit card programs riding the new wave for spenders.
Not long ago, the only company really focused on credit rewards was Discover which had a generous 2% cash back feature on transactions.  But over the coming months we will hear more and more about other companies following suit and consumers will cash in.  Why?
Finally credit card processing companies are trying to lure in customers with great credit.  Customers like this have great repayment records but still carry balances which translates into revenue for the issuer.  Competition for this breed of client is competitive and banks will have to offer more than just mediocre customer service to look attractive.

Who Benefits From Credit Card Processing Rewards?

This move will also entice consumers to start using credit again.  The debit card programs bit into the market and in many respects retrained spenders to spend with either cash or debit.  Credit transactions were an afterthought because they could not compete with rewards programs nor the frequent discounts offered by merchants on cash transactions.
The new cash back credit cards have evolved a bit and will offer tiered rewards for certain types of spending.  General transactions will have the lowest value while groceries and fuel will each respectively be higher.  Some issuers will offer up to 5% cash back on specialty categories throughout the year in partnership with major retailers.  For example, Spring might be lawn and garden season while Summer might see higher rewards for home improvement spends.
It all sounds like great fun and great deals for savvy consumers and those who literally play their cards right will cash in.  Airline Miles and sign up bonuses will loom large before Christmas in order to get people spending on their new cards in time for the holidays but these offers are not for everyone.

Great Credit Will Get You Credit Card Processing Rewards

Those with bad credit need not apply.  Credit card processing companies are in it for the money and they are willing to part with a little to keep the type of customers they profit most from.  Poor credit not only is risk heavy, but believe it or not, revenue often suffers.  Charge offs and collections eat into the profits of credit card processing companies so they would much rather deal with client who spends often and repays bit by bit but does so on time

Credit Card Fraud

It has long been understood in the credit card processing industry, but not always by those who actually accept credit cards, that security has been rather lax.  Most merchants do not understand how far behind the United States is compared to other countries when it comes to privacy and security.  Keeping up with the crooks is expensive and the industry has resisted necessary steps to protect individuals and their lobbyists in Washington have helped them keep regulations favorable.
Well this might change soon as a result of some recent negative headlines for the credit card processing industry.  Last week there were major arrests in an identity theft ring and government officials are finally calling out the industry.  The Queens, New York D.A. chose to not only blame the criminals in this case but to point out that the credit card industry is partly to blame.  Citing the massive marketing campaigns and limited allocation of funds towards protection, Richard A. Brown wants changes.
Merchants who accept credit cards in Europe know that in order to process the transaction they need not only the card itself, but a personal identification number to be punched into a keypad.  This is similar to what we must do for debit transactions in this country but not for credit.  This simple step would make it much more difficult for fraud to occur because a criminal would have to steal the card and learn the PIN code of the victim.  It sounds easy but the credit card industry here has been slow to make changes saying that it is cost prohibitive.

If You Accept Credit Cards, Watch Out For Credit Card Processing Fraud

The costs are high but in reality it is profit prohibitive to change technology but in the long run everyone would be better off.  Chip technology which actually uses heavy encryption would be a terrific standard for the industry a long with PIN codes for credit transactions but so far it is cheaper to just deal with fraud on a case by case basis than to adopt the changes.  It reminds me of how changes in insurance were not adopted until Hurricane Katrina.
When only one individual is affected by flawed policies nobody cares, but when an entire region of the United States realizes they are victims in one single day, then changes are forced.  It is like that with credit card processing safety and for the first time we have a call to action from a government official whose pockets have not been lined by the banking lobby.
Still reeling from the Durbin Amendment to Dodd Frank which limits fees placed on debit transactions by merchants who accept credit cards, the credit card processing industry will probably try to bury these demands and try to fight this battle later on down the line.

Commercial Mortgage Lenders

The commercial mortgage lending market remains dynamic in 2010 despite the credit crunch and decline in commercial real estate values.  Commercial mortgage lenders have become more conservative across many sectors of the commercial real estate capital markets.  Currently it is a field day for many private party lenders, commonly known in the industry as ‘hard money’ lenders.  Transactions that used to easily qualify for bank and other institutional portfolio loans, today sometimes require an unregulated, hard money lender.  These commercial mortgage lenders are enjoying some of the strongest credit transactions in the history of commercial real estate finance.
Institutional commercial loan lenders have come back strong after approximately two and a half years of near dormancy.  As of April 2010 dozens of new commercial mortgage lenders as well as lenders who had been out of the market have come into the capital markets closing deals.  There have also been a few players re-emerging into the land loan arena.
A strong commercial mortgage lenders such as Financial Compound can be very helpful to borrowers seeking financing, whether its construction or permanent loans, as well as land loans.  A proficient commercial mortgage broker is able to help borrowers, investors, and developers access the real estate capital markets and the commercial mortgage lenders efficiently.  It is the commercial mortgage brokers job to understand the current status of the real estaet capital markets as well as to know the product types and loan structures that each lender offers.  Financial Compound typically speaks to about 500 lenders each week, guaging their interest in our transactions as well as probing them to learn which types of transactions they are looking for.  By conducting on-going and in-depth discussions with such a broad cross section of the commercial real estate finance markets, Financial Compound is a valuable resource for both borrowers and commercial mortgage lenders alike.  Many comomercial mortgage lenders contact Financial Compound to find out what is going on with their competitors and to ask us how to price and structure their loan programs.  Commercial mortgage lenders desirous of lending funds often try to make sure that their programs are competitive, or at least want to understand how they compare to other lenders financing similar transactions.
When borrowers submit loan requests, commercial mortgage lenders typically  like to review historical property operating statements, a rent roll, site plan, and photos, in addition to various other data.  A skillful commercial mortgage broker such as Financial Compound can be a valuable resource to borrowers in preparing the lender submittal.  Financial Compound knows what types of information the commercial mortgage lenders are looking for and can help faciliate the loan request process so that the lender can give a quick and firm decision for the transaction.

Look Good To Lenders, Get Business Loans

It has always been quite obvious that when trying to secure business loans, your business needs to be appealing to lenders.  People tend to lose site of this fact and wonder why they are having a hard time.  Today’s economic conditions warrant a whole slew of different reasons for loan approvals or denials so becoming more attractive to lenders is more important than ever.
New government regulations, although well intended, have created significant problems in the industry.  In the past, business loans were pushed through the application process with reckless abandon and problem borrowers were pushed down the line to become someone else’s problem.  Now, regulators demand more accountability and banks are required to seriously vet potential borrowers.
This is obviously a very good thing for banking, but while potentially problematic business loans are denied for good reason, many potential good financings are left on the table.  This creates a problem for operations deserving of consideration from traditional lenders because banks are not held accountable for passing up good opportunities, they are just accountable for the bad ones.

Is It Hard To Find Business Loans?

In the current environment, if you want to secure capital, you need to try and be the prettiest girl in the room.  Sometimes this can be achieved by attending a small party instead of trying to stand out in a stadium filled rock concert.  The recent changes in banking regulations have required large banks to significantly beef up their reserves which translates into far less capital to be available for lending.  Smaller banks with under $10 billion are not subject to this requirement and therefor may have more ability to lend.
Another important factor in becoming more attractive is to have a good story to tell.  Unfortunately over the last few years businesses have had a hard time showing that there ventures are on the upswing.  If you can’t show good solid growth, then finding a non-traditional lender whose financings do not have to fit into a precise mold may be better instead of wasting time applying to large institutions.

Seek Business Loans At Smaller Banks

Next, when applying for business loans, especially for a start up, lenders like to see that applicants have some experience in their chosen fields.  Borrowers who have at least 3 years in a given field and are willing to, or have already, invested their own money into a venture in that industry are much more attractive borrowers than those with no experience at all.  Also along these lines is the fact that showing that real customers, or at least a compelling market, for your products or services already exist is an advantage.  If there is an opportunity to purchase an existing business rather than starting from scratch, then it could help make you more attractive to lenders.
And then of course there is credit history.  Lenders need borrowers to be credit worthy and show the ability to repay any loan they fund.   Having other assets and showing liquidity is important but for those with little credit worthiness there are always unsecured business loans.  These types of loans will help an owners establish business credit and a repayment history in order to become more attractive in the future.  The rates are competitive and the programs have few restrictions governing how proceeds are used. Trying for business loans at this type of smaller party may be the key to securing financing in the current economic climate.
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