Wednesday, September 28, 2011

Section 6050W of the Internal Revenue Code Affects Merchants and Processors January 2012

The Housing Tax Act of 2008 included the enactment of section 6050W of the Internal Revenue Code which requires merchant account processors to report merchants total gross processing amounts to the Internal Revenue Service. The reporting entity must also provide merchants with a corresponding 1099-K form.
This new requirement includes all processors and merchants, unless the merchant processes less than 200 transactions a year or total transaction payments is less than $20,000. Reporting begins in January 2012 and includes all transactions beginning January 2011.
All merchants must provide their processors with their valid tax identification number (TIN) and tax filing name. If a merchant fails to provide the TIN and tax filing name, or there is a discrepancy between the information provided and the information on file with the IRS, the merchant account provider will be required to hold taxes on future transaction funds. The backup withholding is currently 28%.
Merchants must ensure that the TIN and tax filing name provided to their processor matches what is on file with the IRS to avoid any future backup withholding.
More information on Section 6050W of the Internal Revenue Code

Wednesday, September 21, 2011

Alto Global Processing: Regulation II - Frequently Asked Questions

The Federal Reserve has released a set of frequently asked questions (and answers) about "General-Use Prepaid Cards and Circumvention and Evasion". Given the Regulation II exemptions for certain reloadable prepaid cards, there seems to be a lot of industry questions about what exactly can be done with a general-use prepaid card and still have the card considered exempt from Regulation II interchange caps.
To view the FAQ's please visit: http://www.federalreserve.gov/paymentsystems/regii_faq.htm

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Monday, September 12, 2011

HSBC Merchant Services launches PCI DSS compliance service

Established by card schemes Visa, MasterCard, Amex, Discovery and JCB, the global standards set out minimum security requirements for companies accepting plastic.

Non-compliant firms can face unlimited fines, with one unnamed outfit hit for £100,000 as a result of a card data security breach within the last year, says HSBC Global Services.

Yet research commissioned last year by vendor Tripwire found that the vast majority of UK firms had yet to be certified as PCI DSS compliant with a third unsure if they would meet an upcoming September deadline.

In order to simplify what can be a complex processes, HSBC Merchant Services has launched Global Fortress, a one-stop shop for merchants seeking to become PCI compliant.

The processor says that for £6 a month per merchant ID, Global Fortress will help protect customer data and regularly test security systems, among other services, through qualified security assessor, SecurityMetrics.

Chris Davies, MD, HSBC Merchant Services, says: "Although the process to ensure your business is PCI DSS compliant can be an arduous one, it is necessary to protect customers' card data from fraud and protect the reputation of your business. Not only that, but a merchant may have to pay large fines if they decide to ignore these obligatory requirements.

"Global Fortress allows our customers to manage both of these potentially substantial issues: a simple way of achieving PCI DSS compliance and a path to possibly avoid receiving industry fines when compliance is maintained."

Thursday, September 8, 2011

ALTO GLOBAL PROCESSING: WHAT IS ONLINE PAYMENT PROCESSING?

Online payment processing is the secure transfer and verification of financial data (ex: customer credit card information). This secure transfer of data is initialized from a merchant's e-commerce website or virtual terminal to a merchant's bank account. The communication vehicle to deliver this information between the entities is the payment gateway.

Hence, the gateway securely passes and receives information from financial institutions that have a part in the transaction. In most cases those parties are the Payment Processor (the company that coordinates the authorization, decline and applicable settlement of funds), Acquiring Bank (The affiliate bank that represents Visa/MasterCard) and Issuing Bank (the financial institution that extends the available credit of the card holder backed against the card holder's bank account)

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