Digi­pay: Where High Risk and High Re­wards Meet

ISO & Agent - - HIGH RISK MERCHANT - Mike Ack­er­man, Pres­i­dent, Digi­pay

Digi­pay So­lu­tions Inc. is an in­de­pen­dent pay­ment provider spe­cial­iz­ing in high-risk, high-vol­ume, card-not-present and busi­ness-to-busi­ness mer­chant ser­vices. The com­pany works with lead­ing re­tail­ers and fi­nan­cial in­sti­tu­tions, bring­ing a her­itage of ex­ec­u­tive man­age­ment and ver­ti­cal mar­ket ex­per­tise to its bank­ing part­ners and ex­tended fam­ily of agents, ISOS and mer­chants. The San Diego-based com­pany, with re­gional of­fices in Salt Lake City, Los Angeles and New York, is a con­tin­u­ally evolv­ing pay­ment ser­vice provider (PSP) and pro­pri­etary tech­nol­ogy plat­form.

“Our grow­ing fam­ily in­cludes 31 bank­ing part­ners and some ex­clu­sive chan­nel ar­range­ments,” said Digi­pay Pres­i­dent Mike Ack­er­man. “We may be new but our PSP just turned 20 years, and we’re us­ing our tech­nol­ogy and in­dus­try knowl­edge to build a dif­fer­ent kind of ISO, with peo­ple who share our pas­sion for ex­cel­lence.”

How would you de­scribe Digi­pay’s cul­ture?

Ack­er­man and busi­ness part­ner Sandy Travers de­cided to forego out­side in­vest­ment and build Digi­pay from the ground up, re­cruit­ing team mem­bers who shared their values of in­tegrity, in­tel­li­gence and di­ver­gent think­ing. The Digi­pay fam­ily brings a di­ver­si­fied skill set to the rapidly chang­ing pay­ment pro­cess­ing land­scape. In ad­di­tion to cu­rated knowl­edge of bank­ing and pay­ments, team mem­ber pro­fi­cien­cies in­clude con­sult­ing with ven­ture cap­i­tal firms, guid­ing com­pa­nies through startup, turn­around and crit­i­cal growth phases, re­search, anal­y­sis and tech­ni­cal ap­ti­tude. The fam­ily of as­so­ciates has helped Digi­pay grow or­gan­i­cally.

How do you de­fine a high-risk busi­ness?

Pay­ment card brands and ac­quir­ing banks ex­am­ine an in­dus­try’s busi­ness mod­els, charge­back ra­tios, fraud pro­files and de­fault rates to as­sess risk. In­dus­tries with higher-than-nor­mal re­funds, charge­backs and fraud­u­lent ac­tiv­i­ties cre­ate li­a­bil­ity, not only for mer­chants, but for credit card pro­ces­sors that fail to com­ply with Know Your Cus­tomer (KYC) guide­lines and reg­u­la­tions.

Each in­di­vid­ual pro­ces­sor or ac­quirer as­sesses risk dif­fer­ently. A busi­ness with poor credit may be turned down by one in­sti­tu­tion and wel­comed by an­other one. The same is true for ver­ti­cal mar­kets. For ex­am­ple, in­dus­tries that mar­ket prod­ucts or ser­vices that are not le­gal in all 50 states, are prob­lem­atic due to trans­ac­tional risk in re­stricted ter­ri­to­ries and re­gions.

How do you ac­quire a high-risk ac­count?

Agents who board high-risk mer­chants need part­ners who can help mit­i­gate risk, by pro­vid­ing pre-ap­pli­ca­tion sup­port and reg­u­la­tory com­pli­ance and over­sight. Digi­pay can tap our ex­tended net­work of ser­vice providers to find the best pro­cess­ing fit and op­ti­mal rev­enue op­por­tu­nity for each of our agents and their mer­chants. We help agents nav­i­gate the high-risk process and ad­dress their mer­chants’ needs as they grow their busi­nesses.

Digi­pay is unique be­cause we un­der­write mer­chants in-house.. Our un­der­writ­ers look at many fac­tors when they re­view prospec­tive mer­chants, such as busi­ness and in­dus­try type, years in busi­ness, credit his­tory, de­liv­ery meth­ods and pro­jected trans­ac­tion flows. They also visit web­sites, run back­ground checks and con­sult other sources to ver­ify a mer­chant’s com­pli­ance with FTC reg­u­la­tions and card brand rules. Many busi­nesses get ap­proved quickly and eas­ily once all re­quired items have been met.

Digi­pay un­der­writ­ers work with more than 31 bank­ing part­ners and di­rect each high-risk ap­pli­ca­tion ac­cord­ingly. They pe­ruse nu­mer­ous ac­count doc­u­ments

to as­sure each busi­ness is com­pli­ant, fi­nan­cially sound, and a good credit risk. High-risk mer­chants re­quire more due dili­gence dur­ing the new ac­count on­board­ing process. Our un­der­writ­ers’ bank re­la­tion­ships and proven pre­screen­ing meth­ods help agents board high-risk and pre­vi­ously de­clined mer­chants.

How does Digi­pay mit­i­gate charge­backs?

Charge­backs can be an emo­tion­ally charged is­sue for many mer­chants, but with the right sys­tems in place, man­ag­ing and de­fend­ing against them can be a rou­tine part of any mer­chant’s busi­ness. Main­tain­ing a low charge­back ra­tio is key to main­tain­ing a healthy mer­chant ac­count. Mer­chants can re­duce the risk of charge­backs by of­fer­ing great prod­ucts, ex­cel­lent cus­tomer ser­vice, clear and con­cise re­fund/can­cel­la­tion poli­cies, and prac­tic­ing preven­tion. Digi­pay pow­ered by Tran­z­lyt­ics of­fers mer­chants hu­man fraud ex­perts with real-time ac­cess to a fraud and charge­back man­age­ment plat­form that is integrated with charge­back alerts and will in­tel­li­gently score the risk as­so­ci­ated with ev­ery trans­ac­tion, cus­tomer, and af­fil­i­ate mar­keter.

What is friendly fraud?

While in­dus­try best prac­tices can re­duce charge­back ra­tios and help pre­vent fraud­u­lent trans­ac­tions, there is no sil­ver bul­let against charge­backs, be­cause not all charge­backs are caused by fraud, iden­tity theft or pro­cess­ing er­rors. The lead­ing cause of charge­backs, ac­cord­ing to pay­ments in­dus­try statis­tics, is “friendly fraud.”

So-called friendly fraud, also known as charge­back fraud, hap­pens when con­sumers dis­pute charges made with their own credit cards, af­ter re­ceiv­ing a prod­uct or ser­vice. Whether they are dis­sat­is­fied with level of ser­vice, claim they never re­ceived a prod­uct, or just want a re­fund with­out a re­turn, most friendly fraud be­gins as le­git­i­mate com­merce and goes bad af­ter the sale. From a mer­chant’s point of view, there is noth­ing friendly about this type of fraud.

What is the Tran­z­lyt­ics plat­form?

Tran­z­lyt­ics uses busi­ness in­tel­li­gence and hu­man ex­per­tise to pre­vent good trans­ac­tions from be­ing de­clined. Our trans­ac­tion an­a­lyt­ics can iden­tify good cus­tomers based on their trans­ac­tion his­tory and elec­tronic foot­print. For ex­am­ple, the Tran­z­lyt­ics plat­form uses ad­vanced tech­nolo­gies to an­a­lyze ecom­merce trans­ac­tion flows and as­sign risk scores to af­fil­i­ates. Af­fil­i­ates earn com­mis­sions by driv­ing traf­fic to the ecom­merce sites. Man­ag­ing this traf­fic, by pro­tect­ing card­holder data and weed­ing out fraud­u­lent trans­ac­tions, pro­tects mer­chants from charge­backs and fraud­sters who are be­com­ing in­creas­ingly adept at ex­ploit­ing vul­ner­a­bil­i­ties.

The Tran­z­lyt­ics plat­form is en­gi­neered to adapt and change in re­sponse to the ever-chang­ing threat land­scape. Our team of fraud and charge­back ex­perts pro­tects mer­chant ac­counts while keep­ing their pro­cess­ing at the low­est rates. Our tai­lored “Pro Ser­vices” con­tin­u­ously mon­i­tor mer­chant MIDS to op­ti­mize in­ter­change rates and re­act to changes and trends in real time.

What dif­fer­en­ti­ates Digi­pay from other com­pa­nies in the space?

We do things dif­fer­ently at Digi­pay. We are an ag­ile, one-stop-shop where agents can speak to one per­son re­gard­ing sev­eral pro­ces­sors. The Digi­pay dif­fer­ence is re­flected in our two-fold com­mit­ment. First, we com­mit to book ev­ery busi­ness, ev­ery time. What­ever le­gal busi­ness comes our way, high-risk or low-risk, we have a place to book that busi­ness. Sec­ond, we com­mit to keep­ing MIDS live. In the high-risk space, mer­chant life­cy­cles can be short. Our Tran­z­lyt­ics plat­form and ded­i­cated spe­cial­ists com­bine hu­man over­sight and ma­chine in­tel­li­gence to ex­pand MID longevity and mer­chant ac­count port­fo­lios.

“Main­tain­ing a low charge­back ra­tio is key to main­tain­ing a healthy mer­chant ac­count.”

Newspapers in English

Newspapers from USA

© PressReader. All rights reserved.