We break that ecosystem down in more detail here. Think of ISOs as official service providers on behalf of the cardmember associations and acquiring banks. It’s easiest to think of the payment ecosystem like a pyramid, and ISOs sit in the middle.īelow the ‘ISO agent’ chunk of the pyramid would be the merchants and then the consumers themselves. Where do ISOs fit into the payment ecosystem? So if you’re wondering, do ISOs offer merchant services? Then yes, absolutely yes.Īnd so on. Read more: What is a Merchant Account? Everything You Need to KnowĪfter that’s established, the competitive differentiators in ISOs come from differences in service, technology, and rates.
#What is iso iso
You can’t accept credit cards without them (although some third-party processors let you use their merchant account), so they are the most important partnership for an ISO to have. Merchant accounts are the official accounts that your business’s revenues are deposited in before they are sent to your chosen business account. Īn acquiring bank is a bank that has the authority and ability to provide merchant accounts. ISOs make money by selling and leasing hardware/software along with taking a percent of transaction revenues.Īnd the way they seem to provide everything a merchant needs is by already having partnerships in place to provide all parts of accepting credit cards - most importantly by having a direct relationship with an acquiring bank. These are businesses that typically have their own set of technologies and sales agents, some operate essentially independently and set their own processing rates, and they act as a one-stop shop for all things merchant services. ISOs, or independent sales organizations, are companies who aren’t officially part of the cardmember associations like VISA or MasterCard but have developed partnerships with acquiring member banks to provide merchant accounts or other merchant services to members. Today we’re talking about ISOs, and we’re going to tell you everything you need to know.
The payments world is confusing, and understanding all of the players and how the money flows between them is important.īy understanding the business models of the people you’re partnering with, you put yourself in a better negotiating position and improve your ability to discern trustworthy partners from seedy ones. Regardless of where you are in your business life, you’re in the right place.
You’re considering switching payment providers and are curious to see what your options are.
#What is iso how to
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