Below are some common things that Merchants have done that have caused them a great deal of problems related to their Merchant Account. All of the following items may result in you losing your Merchant Account and/or being fined.

All of the following items may result in you losing your Merchant Account and/or being fined. When the cardholder presents its card for payment the first thing you must do is examine the card. Has it been altered in any way? Is it expired? Is it signed? Does the signature panel indicate the card is VOID? Train your employees on proper practices for accepting credit cards in your business

Credit Cards - Players

• Acquirer

The Acquirer is the financial institution that provides a Merchant with a Merchant Account. Sterling Payment Technologies is the acquirer who handles acceptance and payment of credit card transactions to the Merchant’s bank account. In a way they front the money for the Issuing Banks, depositing the Merchant’s funds prior to these funds actually being transferred via Interchange from the cardholder’s Issuing Bank.

An acquirer pays the Issuing Banks and Card Associations fees for transactions processed on behalf of its Merchant account holders.

• Merchant Services Provider (MSP) / Independent Sales Org. (ISO)

Merchant Services Provider (MSP) is also calledan Independent Sales Org. (ISO) They will quote the Merchant the rates and setup account information with both the Front-End and Back-End Processors to handle the Merchant’s credit card transactions. The Merchant Services Provider is responsible for all communications and relationships between the Merchant, Card Associations, processors and Merchant Banks.

Sterling Buying Group is the MSP/ISO that is responsible for quoting pricing to the Merchant. We will also handle customer service, technical support, and equipment sales and rental. The majority of your customer calls will come into our support center in Tampa FL. All escalations are handles in our office in Cincinnati.

• Payment gateway Providers

Payment Gateways connect the Merchant to the processor that is acting as the front-end connection to the Card Associations. Sterling supports all of the largest gateways such as Authorize. net, CyberSource, eProcessingNetwork, and our award winning gateway partner PayTrace. They are called Gateways because they take many inputs from a variety of different applications and route those inputs to the appropriate processor. Gateways communicate with the processor using dial-up connections, Internet-based connections, IVR lines, and/or privately held leased line connectivity.

Besides offering simple data transportation, Gateways can offer additional value added services such as advanced reporting, auditing and fraud control. Gateways support different point-of-sale systems, processors and merchant types. Sterling will carefully assess which system is the appropriate for every scenario.

• Issuing Bank (the bank that issues the credit card)

Also known as the Issuer, this is the financial institution that physically provides a credit card to an individual for use. These institutions promote the use of these distributed cards and charge the cardholder interest and fees for the use of the card.

The Issuing Bank receives the majority of the Interchange Fee charged by the Card Associations. Most of the power in the credit card industry resides with the Issuing Banks. Examples of current Issuing Banks include: Fifth Third, Bank of America, Chase bank, Citibank, GE Money Bank, and HSBC.

• Card Associations (Visa-MasterCard-Discover-Amex-JCB)

They are Visa, MasterCard, American Express, Discover, JCB, and private label carriers like fleet card providers. Wright Express, Voyager, and Fuelman are the most predominant. They work in conjunction with various local, state, territory and federal government agencies to make the rules regarding acceptance and use of credit cards. These rules include security regulations, data requirements and interchange rates.

• Front End Processors (Authorization Networks)

Front-End Processors handle the up-front authorization of a credit card transaction. They have connectivity to all of the Card Associations and route transactions to the appropriate network for authorization. The Front-End Processor is the Merchant’s point of connectivity for authorization and settlement of transactions. When a Merchant settles or submits a batch, it is sent to the Front-End Processor who then routes the batch to its Back-End Processor.

Sterling will primarily use Gensar and TSYS. Two of the largest networks with an uptime of 99.99%

• Back end Processors (Settlement Servers)

Back-End Processors receive settlement batches from the Front-End Processor. Transactions from all Merchants are grouped together by BIN (Bank Identification Number) range and submitted to the appropriate Issuing Bank on a scheduled time frame.

The Back-End processor settles the transactions, calculates interchange fees, monitors risk, and provides the merchant and the card associations with processing data.

Sterling Payment Technologies is one of only nine End Processors.

• Sponsoring Bank (The bank that moves the money)

The sponsoring bank provides access to the card associations, sets up the ACH payments for the Back-End processor, and moves the appropriate funds to the merchants bank based on the BIN.

Responsible for paying the Associations and the issuing bank their share of the Interchange fees.

Sterling Payment Technologies utilizes three sponsoring banks. Chase, Wells Fargo, and Merrick.

The following tables set forth the interchange reimbursement fees applied on Visa financial transactions completed within the 50 United States and the District of Columbia.

Visa uses interchange reimbursement fees as transfer fees between financial institutions to balance and grow the payment system for the benefit of all participants. Merchants do not pay interchange reimbursement fees; merchants pay "merchant discount" to their financial institution. This is an important distinction, because merchants buy a variety of processing services from financial institutions; all these services may be included in their merchant discount rate, which is typically a percentage rate per transaction.