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The Dodd-Frank Financial Reform Bill and the recently approved terms of a Department of Justice lawsuit now allow merchants to set minimum purchase amounts of $10 or less. The rule applies only to credit cards; no minimums are allowed on debit cards.

The new rules also allow merchants to offer discounts or other incentives for payment by cash, checks, debit cards or credit cards, provided that the incentives do not differentiate on the basis of card issuer.

Can a simple checklist lead to dramatic improvements in performance?

At Avid, we’ve had key members of our team read, “The Checklist Manifesto,” by Atul Gawande. It’s the book version of an article that appeared in the New Yorker magazine back in 2007. You can read the article here. It focuses on the health care industry, where checklists are saving lives; the book, which is an excellent investment of $15, delves into quite a few other industries.

No doubt the checklist can be applied to any organization, and if it can save lives, it can increase sales, improve customer service and lead to greater profits and happier customers. It’s amazing how something so simple can have such a huge impact on the quality of what we do.

The Internet is becoming a bigger and bigger factor in credit card/payment processing, going far beyond eCommerce:

Countertop terminals that process via the Internet are now so common that one of the nation’s top payment processor, Chase Paymentech, recently announced that it will no longer sell traditional terminals that process via phone lines. It cited incompatibility between traditional terminals and the new digital phone lines offered by carriers such as Comcast and Vonage. The newer terminals, which use Ethernet connections, are faster and less costly to operate than traditional terminals.

Internet-connected smartphones and tablets equipped with inexpensive software, card-readers and printers can now replace traditional, expensive wireless terminals, making mobile, wireless processing affordable to more merchants. That’s good, because businesses that can swipe cards and authorize remotely qualify for lower processing rates. The reduced cost to enable such processing means quicker return on investment.

Internet payment “gateways,” originally devised to enable eCommerce, can now act as funnels for transactions from a variety of sources, including point-of-sale systems, mobile smartphones, accounting systems, recurring billing databases, payment URL’s and more. They can also store cardholder information securely, simplifying a merchant’s PCI Compliance requirements.

The federal Housing Assistance Tax Act of 2008 requires card processors beginning in January 2012 to report to the IRS all payments to merchants for transactions processed in the previous year. Avid and its processing partner First Data are working hard to prepare to comply with this new law and  issue the new corresponding Form 1099-Ks to their merchants.

The new law also requires backup withholding of 28% when a merchant’s name and Tax ID number (TIN) on file with us do not match the information on file with the IRS. That’s where preparation counts. While ultimately it is a merchant’s responsibility to make sure correct information is on file, the IRS TIN Matching System enables us to verify our information. We are doing that, and making corrections accordingly.

Given the backup withholding requirement, Avid’s goal is 100% compliance. If you are contacted by an Avid representative, please cooperate in verifying or correcting the information on file with us. If you have any questions, or suspect that the information we have on file does not match what the IRS has, please contact us immediately.