Top Free Online Shopping Carts

Today The Official Merchant Services Blog shifts its focus to the E-Commerce industry — specifically some tips we’ve found online to help small businesses with their e-commerce solution.

An article written by Nova Scotian Vangie Beal details the ins and outs of ten open source online shopping carts that are available to merchants or really anyone who wants to sell things on the internet. Beal’s been covering small business, e-commerce and internet technology for more than a decade with her writing. You can find the original article here.

E-Commerce has become an integral part of the economy throughout the world. Shoppers have embraced online shopping as part of their normal shopping routine. So businesses have responded by jumping into e-commerce and providing those consumers with competitive options that focus on the convenience that can be had with the click of a few buttons — the classic clicks vs. bricks debate is showing that clicks beat bricks.

So what do Merchants need to know about E-Commerce to get started?

Step One: Get A Payment Processor

The first step is something Host Merchant Services can handle — payment processing. Merchants need to accept payment in the form of credit cards and debit cards to stay healthy and viable as a business. So merchants need to incorporate payment processing solutions both in their brick and mortar stores as well as on their website with their online shopping solution. Host Merchant Services provides merchants with these options — along with free equipment and a guaranteed low rate that will save them money.

So step one in setting up your e-commerce business is to get a merchant account, with the services Host Merchant Services provides.

Image for Host Merchant Services article on credit card processing

Step Two: Your Online Shopping Cart

Now that you’ve got a merchant account set up and are reedy to process payments online, step two is to get an online shopping cart for your website. As Vangie Beal says in her article, “When shopping for your own e-commerce shopping cart software the most important aspect toconsider is how well the cart software meets your business objectives.”

The shopping cart has to be customizable so that you can alter it to fit your business needs. It also needs to be able to fit your branding so that the shopping cart melds seamlessly with the rest of your website. It needs to be flexible so that as your business grows, your online shopping card and ability to process payments online can also grow. It needs to be secure and it needs to support industry security standards such as PCI compliance.

You can read about PCI Compliance Standards in the Host Merchant Services Article Archive.

We provide a PCI FAQ here.

We provide a step by step guide on PCI Compliance here.

PCI Compliance

Open Source Shopping Cart

Vangie Beal’s article discusses the top 10 free or Open Source shopping carts. Beal says “Open source shopping carts are an attractive option. Storeowners might look to open source e-commerce software because it will typically deliver the features and tools to manage a product catalog on a website without the hefty licensing fees that come with proprietary or off-the-shelf packages.”

Continue Reading – Top Free Online Shopping Carts, Part 2

Phishing Scam Alert

Attention Merchants. The Official Merchant Services Blog has been made aware of an e-mail based Phishing campaign designed to trick individuals into providing login credentials for their credit card processing — specifically one of the payment gateways that a merchant uses.

The e-mail generally has a subject title of “Annual Agreement Renewal” and the body of the message is communicating that their “retail account” or “merchant agreement” is expiring. When you open the attachment it appears to have a login page prompting a login.

Be advised that this is an attempt at social engineering intended to steal those login credentials. Neither Host Merchant Services nor TransFirst is the source of these e-mails. These e-mails should be disregarded and deleted. This is an industry wide issue that has escalated in recent days. The Official Merchant Services Blog and Host Merchant Services have been made aware of e-mails appearing to be from TransFirst as well as other payment processers.

If you are a merchant and you have been taken in by this scam, please have contact merchant support at 1-800-654-9256 or contact us at Host Merchant Services directly at 1-877-517-HOST (4678).

Host Merchant Services will continue posting notices on our key sites and our social media channels. TransFirst is also getting the word out, posting information as TC, Epay, TransLink, Transfirst.com and other social media channels.

If you have any questions regarding this scam, please contact Host Merchant Services support.

Host Merchant Services image on phishing scams

Some Basic Information on Phishing

Phishing is an attempt to acquire information such as usernames, passwords, and credit card details by masquerading as a trustworthy entity in an electronic communication. Communications purporting to be from popular social web sites, auction sites, online payment processors or IT administrators are commonly used to lure the unsuspecting target of the scam. Phishing is usually carried out by e-mail spoofing or instant messaging, and directs users to enter details at a fake website whose look and feel are almost identical to the legitimate one.

How To Defend Against Phishing

The scam artists behind phishing emails are smart and know how to create emails and websites that look like they are official and from well know companies or organisations. Because of this, the typical security measures taken with electronic communication — such as firewalls — don’t stand up to the scams.

There is no real effective software-based means of defending against phishing scams. Common sense tends to be your best defense. Always exercise caution when replying to an email that requests personal information or passwords. Also, never click on links found in such e-mails. Even if you believe the content of the message is genuine you should type the web address into your browser directly to ensure that you are visiting the correct site.

Here are a few more tips for avoiding phishing scams:

If you believe an e-mailed request for information is genuine then call the company to confirm before entering data on a website.
If you need to entire sensitive information on a website then look for a padlock in your browser’s status bar to signify that you are on a secuire site.
If you believe that you have fallen victim to a phishing scam contact the bank or credit card company immediately so that they can freeze your accounts and take action on your behalf.

For information and tips on how to protect yourself from online scams like phishing or identity theft or credit card fraud you can read this article in the Host Merchant Services Article Archive.

Durbin Amendment Back In the News [2023 Update]

The Official Merchant Services Blog returns to a topic that it covered thoroughly throughout 2011: The Durbin Amendment. With the Stop Online Piracy Act getting most of the headlines lately, Durbin Amendment’s continued impact on the payment processing industry has gone into stealth mode. Until today that is. Stick with us as we offer a whirlwind roundup of all things Durbin related.

Bank of America Took a Beating

We’ll start off our tour Durbin tidbits with this article by ABC News. Apparently Bank of America took a substantial hit from their plan to charge $5 per month to use debit cards. According to the article: “Bank of America’s failed plan to impose a $5 monthly debit card fee led to a 20 percent increase in closed accounts in the last three months of 2011 and a public relations headache.”

The article quotes Bank of America CEO Brian Moynihan as saying, “yes, we had some impact from the $5 debit fee. That’s why we made a decision to reverse it.”

It wasn’t all bad news for Bank of America though, as the bank reported earnings of $2 billion in the last three months of 2011, up from a net loss of $1.2 billion in the same period a year ago, boosted in part from a one-time gain on the sale of China Construction Bank.

Small Lenders Strike it Big

The next little bit of Durbin aftermath comes from this article by NACS online. As was seen in the Host Merchant Services in-depth analysis of the legislation, The Durbin Amendment only applies to lending institutions with assets over $10 billion. Smaller banks and credit unions are exempt from the Durbin Amendment. As a result of being exempt, a Wall Street Journal report cited by the NACS article states that these institutions have been “collecting fees that are often three times those imposed on cards by large banks.”

For comparison, the article says: “The WSJ notes that a $100 sweater purchased with a debit card would incur a fee of 95 cents on a card issued by a smaller bank and only 26 cents for those issued by big banks. “

The article also suggests that banks face further uncertainty by April 1, 2012, when “all U.S. banks and credit unions must offer retailers more choices of companies used to process debit card transactions, a move that is expected to lower interchange fees further.”

New Target: Credit Card Swipe Fees

Time Magazine Online Feature Moneyland reports something that Host Merchant Services has already touched on before in The Official Merchant Services Blog — that Credit Card Swipe Fees may be the next target of legislators and financial reform. From the Time article: “There’s another interchange fee fight in the offing — this time over credit cards. According to CNBC, equity analysts who cover the financial sector have expressed worry that ongoing litigation involving several major banks could lead to a cap of 0.5% on credit interchange fees — one-fourth of what’s currently charged — potentially dragging down bank earnings. If that happens, consumers who are used to generous credit card rewards programs complete with double miles, accelerated earnings, and big sign-up bonuses might get a rude awakening.”

The Official Merchant Services Blog on December 13, 2011 covered the topic of a Credit Card Swipe Fee. In that blog we wrote: “the plan would end up working much like the Durbin Amendment has worked. Where the idea of reform would get overshadowed by how banks and credit card companies reacted to the law. There would be some shifting, so in that sense the reform would cause change. But that eventually the burden for paying for any losses that banks and credit card companies get forced into through reform would end up squarely on the shoulders of the consumers.”

The Time article notes something that Host Merchant Services already pointed out regarding a Credit Card version of the Durbin Amendment — Banks would take another huge hit because Durbin has language that freed up banks and merchants to market and promote options to the consumer directly. In short, Durbin’s language freed merchants up to promote credit over debit. And because of that, a lot of merchants did just that as Banks offered new programs to make credit the more attractive choice. Subsequent changes that would now penalize Banks for doing that would create a lot of negative momentum for Banks and added onus for consumers who get stuck with no good choices overall.

New Hampshire Law

This article from credit.com reveals that one state legislature is already making moves to see a Credit Card Swipe Fee Cap become reality. As the article states: “A piece of legislation introduced in the New Hampshire House of Representatives, House Bill 1319, has drawn some attention for the way in which it would drastically alter the credit card landscape between businesses and payment processors. The law will limit the amount banks chartered within the state are able to charge businesses for processing credit card transactions to just 1 percent of the total purchase value.”

The article goes on to state that many businesses pay costs that range from 0.67 percent of the transaction’s value to 4.76 percent and that a MasterCard spokesperson told the Nashua Telegraph that the average 1.75 percent.

Cash Still Rules Everything Around Me

Our last news brief on the topic of the Durbin Amendment and swipe fee caps is a little different. This article from the Huffington Post shows a study that reveals cash is still king. The gist of the article: “More than three-quarters, or 79 percent, of consumers said they made a cash purchase in the last seven days, according to a report released on Tuesday from Javelin Strategy & Research, a market research group for financial services. Compare that to about 65 percent of credit and debit cardholders who say they swiped their plastic in the last week.”

The article suggests that this is a consumer reaction to card swipe fees. The article states that consumers are choosing to pay for items with cash to avoid fees on small, everyday purchases. The convenience of plastic gets overrun by the savings consumers perceive they get from going back to cold, hard cash. The study indicates that cash is replacing debit for small purchases, and credit is replacing debit for big purchases and the Durbin Amendment’s lasting legacy may simply be that it pushes Debit out of the consumer’s arsenal of payment options.

Mobile Payments: 2023 and Beyond [2023 Update]

Today The Official Merchant Services Blog updates our outlook on Mobile Payment Technology and the rampant predictions for its success in the near future. We have previously covered the topic with this blog entry on Tuesday, October 18, 2011. The parameters of that blog are still pretty much the current state of Mobile Payments. But there have been some very interesting developments from the end of 2011 and moving into the first quarter of 2012.

Black Friday Boom

The Black Friday business blitz revealed some healthy news for Mobile Payments. According to this article from Seeking Alpha, mobile payments business increased 500% from 2010 on Black Friday. According to the article, PayPal mobile reported the huge increase, coming in at 511% to be exact. PayPal Mobile also noted that there was a 350% increase in mobile shopping on Thanksgiving 2011 when compared to 2010.

According to numbers from the aforementioned IBM research, 17.37% of all consumers used a mobile device on Black Friday to visit a retailer’s site. And 9.73% used a mobile device to make a purchase. The Seeking Alpha article quoted Amanda Pires from PayPal. Pires suggested that this year’s holiday is proving to be the largest mobile holiday shopping season PayPal and eBay has ever seen, and then quoted Pires directly as stating: “The retailers that are taking advantage of mobile shopping are going to win. We expect mobile shopping to continue to be strong throughout the holiday season.”

This is good news for Mobile Payments, as Host Merchant Services research has shown in the past that there have been some bold predictions for growth in Mobile Payments, but that the services were slow in taking hold this year in the U.S. Growth like the numbers cited from Black Friday 2011 should fuel more positive momentum for that consumer payment option.

From 2012 Onward

All of this brisk business in the mobile payments sector is indicative of the forecasting that analysts and reporters have been making for the technology. But the obstacle that our Magic 8-Ball suggested hurts the industry still remains: Consumer confidence. There’s still trust issues with mobile payments. This article by Eric Savitz from Forbes really delves into the heart of what we at Host Merchant Services have been saying about Mobile Payments.

Savitz says: “There’s a common thread between these points: there has to be something fundamentally changed about the current point of sale model in order for mobile payments to take off. It’s about added value and convenience to the consumer, and the ability to drive more customers, loyalty, efficiency and lower risk for the merchant and banks and operators involved in the payments process. Think of contactless “tap and pay” credit cards – you may have one in your wallet right now, but you still swipe it anywhere you go. As a consumer, there’s nothing more convenient or inherently better about tapping your card vs. swiping your card if all that matters is making the payment. Would the time spent setting up and configuring a “mobile wallet” be worth it if the only difference at the cash register of Macy’s is that you wave a phone over a terminal rather than swipe a card through one? Doubtful.”

That’s what Host Merchant Services has been saying. It’s about convenience to the consumer. The worries about security are valid. E-Commerce has faced the same problems with security and the same worries. But people have adopted online shopping — as seen with the same Black Friday and holiday shopping season boom in 2011 — to the point where it’s now just a common part of the shopping experience. People can’t even remember back 10 years where online shopping was new, awkward and insecure. It’s just part of their lives now.

And for Mobile Payments to jump off the same type of conversion of consumers has to take place. Convenience will outweigh security concerns and people will just accept the behavior as part of the way they shop. That’s where the Mobile Payments Industry stands right now. On the edge, waiting for the breakthrough that will rocket it into everyday life for shoppers. It has to grow beyond gimmick. Because gimmick won’t carry it forward. It might be easy to do, but as Savitz points out, if there’s no reason to swipe your phone over just using your card in your wallet, people won’t bother.

Small Businesses Susceptible to its Charms

One inroad Mobile Payments are making with consumers is through small businesses. This article from Newsfactor.com delves into how small businesses are seeking mobile payment solutions that free them from reliance on traditional payment solutions. The article discusses how Square has been shaking things up with the changes its made to its business model in 2011, becoming an entire processing solution itself and making its card reader more readily available to merchants. The article then mentions how Gartner Research data shows that the Mobile Payments Industry surged to $86.1 billion in 2011. The article notes that Square is just one of many viable options that are helping fuel the growth the sector is seeing.

HMSPay

Host Merchant Services recognizes the huge growth potential in this sector of the industry. Beyond their coverage of the latest developments and news that take place in Mobile Payments, Host Merchant Services offers its own mobile payment solution, HMSPay. The solution utilizes a card reader that is attached to a smartphone and an application on the phone which transforms it into a payment processing terminal, complete with signature field and e-mailed receipts.

So What’s Next?

Savitz’ article suggests that the potential breakthrough for Mobile Payments will take place in 2012. And that the catalyst for this breakthrough will be through value added applications of the process. He cites Google Wallet and Isis as showing the most promise in being a catalyst because they both go beyond just having the swipe gimmick and offer “services delivered on top of the payment itself.” He says these additional services will be what prompt consumers to shift into mobile payments. He offers these bullet points:

Deals and offers: Highly targeted, relevant offers based on prior buying patterns and current location. Imagine receiving a time-sensitive text message or in-app alert with a coupon to your favorite electronics store after your digital wallet “checks in” that you are within the store.
Digital receipts and account information updated in real time to give a comprehensive view of personal and linked accounts while also displaying loyalty rewards status.
Real-time, customizable alerts to certify that the purchases being made in an account are valid, based on your phone’s proximity to where the purchase is being made.

So it appears that one promising avenue for the evolution of mobile payments is to essentially make them a virtual wallet “plus.” Something that does more than just allow you to pay with a swipe of your phone. Something that collects the relevant data and helps you manage your shopping right there, at your fingertips. Something that tracks your own shopping trends and makes you aware of deals, then lets you conveniently take advantage of those deals.

It’s a compelling point. Host Merchant Services sees the value in such a transition. The technology works to make the consumer’s shopping experience convenient and comprehensive — something a shopper can’t even consider they could do without in previous years. That’s what happened with e-commerce, after all.

SOPA: Time For a Nap [2023 Update]

When last we posted, The Official Merchant Services Blog was busy highlighting its own in depth coverage of the Stop Online Piracy Act and having a few yuks at the expense of the bill’s sponsor, Lamar Smith [R-TX], for having a web-site that violated the bill he sponsored.

Since then, SOPA has somersaulted into the bright shining spotlight of mainstream media news. There was a blackout sponsored by internet industry giants like Wikipedia, Mozilla and WordPress — the same WordPress that this very blog is constructed out of.

And the protest seems to have had an affect. Congress took notice.

Smith Shelves SOPA

The Los Angeles Times reports: “The SOPA online piracy bill that helped spark this week’s unprecedented Internet protests will be redrafted, its lead sponsor said Friday. The move came shortly after the Senate postponed a key vote on the companion PIPA bill scheduled for next week and amid calls for consensus before Congress moves forward on any legislation to address the problem of foreign piracy websites.”

Bill sponsor Lamar Smith is quoted in various media sources as saying: “I have heard from the critics and I take seriously their concerns regarding proposed legislation to address the problem of online piracy. It is clear that we need to revisit the approach on how best to address the problem of foreign thieves that steal and sell American inventions and products.”

So essentially the struggle to craft a bill to curb online piracy is now in a holding pattern.

This should be heartening news for both sides of the issue. Nobody wants online pirates to flourish. So the core of what the bill is intended to do has merit. The criminals do need to be dealt with. But the way the proposed legislation was worded just wasn’t going to work. Going back to the drawing board was needed. No amount of posturing from Chris Dodd was going to change the words of the bill — which Host Merchant Services provides for download right here.

And those words left too much room for abuse, put the Department of Justice at the mercy of internet trolls, and approached the problem from the wrong direction. Online pirates do need to be stopped. But SOPA was not going to do it.

Hackers vs. Hollywood

As the media intensity for this issue skyrocketed, yesterday saw the FBI make a move of its own. A move against online piracy. The feds shut down the website megaupload.com, as The Hollywood Gossip reports: “Federal prosecutors have pulled the plug on Megaupload, a massive file sharing operation allegedly helmed by Alicia Keys’ husband, producer Swizz Beatz. Four executives were arrested in New Zealand and an indictment charging seven people with content piracy causing $500 million in losses was issued.”

Then hackers fired right back in retaliation. As the Vancouver Sun reports: “Hacktivist collective Anonymous has launched a series of attacks on U.S. government and recording industry websites in response to the takedown of file sharing website MegaUpload. It claims to have taken down 14 websites including the websites for the Federal Bureau of Investigation, the Motion Picture Association of America and the U.S. Copyright Office. CNN has reported that most of the government websites were back up and running as of Friday morning. However, the websites for both BMI and Universal Music were still down. These sites were taken down by DDoS– Denial of Service–attack, a type of attack that overwhelms site servers and forces them down.”

While this back and forth plays right into the oversimplification of the SOPA story — turning into a Hollywood vs. the Internet battle royale — it doesn’t really further the actual issue. The FBI’s actions were under current laws. And the hacker retaliation was nowhere near as effective as the blackouts and protests and e-mail campaigns run by Google, Wikipedia, WordPress and so many others on the internet.

As sexy as hackers and FBI busts are, they just distract from the story.

Recap the Issue

The bill and its Senate twin Protect Intellectual Property Act (PIPA) have been polarizing because of how open-ended the language of the legislation is. Both bills leave a lot of loopholes available for websites to be griefed by random internet users who may have an agenda against a particular site. And the Department of Justice may or may not be tech savvy enough to navigate their way through the abusive claims to get to the proper crimes. Here’s a hypothetical we’ve posited before:

A small business launches its website.
The site, in an attempt to reach out to its customers has a forum or social media section where its customers can post discussions. The intention of this tool is to create links between the business and the customers.
A poster on that site’s forum/discussion area posts a funny, home-made YouTube video. That video contains copyright infringement.
The YouTube video gets reported for its infringement.
Suddenly the site is under investigation under the purview of SOPA, and now this legitimate business gets its site shut down and its processing suspended. The business can’t make money anymore because of reports related to ancillary content on its site — not actual piracy.

And that’s what has SOPA in dire need of a reboot. Right back to the drawing board with this law. Retool it to focus on stopping online pirates, and remove the language that puts the Department of Justice right in the middle of internet arguments, accusations and trolling as they struggle to determine if millions of sites need to get shut down for mere complaints.

For More Information

We initially posted about the controversy of SOPA with our November 20, 2011 blog.

Host Merchant Services provides an in-depth analysis of SOPA here. It explains the bill: “The Stop Online Piracy Act (SOPA) is also known as H.R. 3261. It was introduced in the House of Representatives on October 26, 2011 by Lamar Smith [R-TX] and a bipartisan group of 12 initial co-sponsors. The bill is currently creating a lot of controversy in both the tech sector as well as the credit card processing industry because it expands the ability of U.S. law enforcement as well as copyright holders to fight online trafficking of copyrighted intellectual property and counterfeit goods.

SOPA: Pot Meet Kettle [2023 Update]

The Official Merchant Services Blog has late breaking news to report today. Once again we take on the topic of the Stop Online Piracy Act (SOPA). In perhaps the strangest twist to date for the ongoing saga that is the battle between the entertainment industry to curb piracy and the internet industry to keep their business free of government interference on a micromanaged level — Alex Fitzpatrick from mashable.com reports that SOPA has some SOPA issues.

Lamar Smith Copyright Violation

In Fitzpatrick’s article, found here, it is noted that the sponsor of the Stop Online Piracy Act (H.R. 3261) Lamar Smith has a copyright violation on his own website texansforlamarsmith.com.

The article follows a report from Jamie Lee Curtis Taete over at www.vice.com. Taete investigated Lamar Smith’s website for any potential copyright issues. You can see Taete’s investigation here. Taete describes describes the impetus for the investigation: “US Congressman and poor-toupee-colour-chooser Lamar Smith is the guy who authored the Stop Online Piracy Act. SOPA, as I’m sure you know, is the shady bill that will introduce way harsher penalties for companies and individuals caught violating copyright online (including making the unauthorised streaming of copyrighted content a crime which you could actually go to jail for). If the bill passes, it will destroy the internet and, ultimately, turn the world into Mad Max (for more info, go here).

I decided to check that everything on Lamar’s official campaign website was copyright-cleared and above board. Lamar is using several stock images on his site, two of which I tracked back to the same photographic agency. I contacted the agency to make sure he was paying to use them, but was told that it’s very difficult for them to actually check to see if someone has permission to use their images. (Great news, copyright violators!) However, seeing as they’re both from the same agency and are unwatermarked, it seems fairly likely that he is the only person on the entire internet who is actually paying to use a stock image (and he’d be an idiot not to).

So I took a look back at an archived, pre-SOPA version of his site.”

Caught Red Handed

The violation stems from Lamar Smith using this image:

On his site it appeared like this:

Taete fills in the full details of this violation: “I managed to track that picture back to DJ Schulte, the photographer who took it.

And whaddya know? Looks like someone forgot to credit him.

I contacted DJ, to find out if Lamar had asked permission to use the image and he told me that he had no record of Lamar, or anyone from his organization, requesting permission to use it: ‘I switched my images from traditional copyright protection to be protected under the Creative Commons license a few years ago, which simply states that they can use my images as long as they attribute the image to me and do not use it for commercial purposes.

‘I do not see anywhere on the screen capture that you have provided that the image was attributed to the source (me). So my conclusion would be that Lamar Smith’s organisation did improperly use my image. So according to the SOPA bill, should it pass, maybe I could petition the court to take action against www.texansforlamarsmith.com.’

Oh dear. Luckily for DJ, there are people out there like Lamar making new laws to protect the little guy against online copyright theft. Keep fighting that good fight, Lamar!”

No Response Yet

No spokespeople from Lamar Smith have been available for comment on this issue. Maybe when the egg on their faces is removed there’ll be time to address the silliness that stems from the SOPA sponsor not taking enough time to make sure his own site didn’t fall under the extremely broad language that would allow the Department of Justice to shut down his own site.

Luckily for Smith, the bill hasn’t been signed into law just yet, so Google doesn’t have to remove his site from their search engine, and his payment network provider doesn’t have to suspend transactions from the donation portion of his site.

For More Information

To find out more about the Stop Online Piracy Act, you can read the in-depth Host Merchant Services Analysis here.

To read the proposed legislation itself, you can download it here.

Stop Online Piracy Act Coming Back [2023 Update]

Today The Official Merchant Services Blog brings you all an update on the Stop Online Piracy Act. This legislation has been picking up traction in the news the past couple of days because it’s become a talking point in the GOP Presidential Nomination race, and because Congress is set to resume discussion of the bill. The bill is up for a vote at the end of the month and will be getting a lot more media heat in the coming weeks.

What is SOPA?

We initially posted about the controversy of SOPA with our November 20, 2011 blog.

You can download a PDF of the bill here.

The Root of Controversy

The bill has been polarizing as the sides that support and the sides that rally against the bill get oversimplified into the entertainment industry and those interests it successfully lobbies for support the bill; the tech and internet industries and those interests they successfully lobby for are against the bill.

The relevant twist for The Official Merchant Services Blog is that the bill includes payment processors. It defines them as Payment Network Providers and includes them in the scope of the bill. The bill holds Payment Network Providers responsible for the content on the websites of its customers and words it so that the Department of Justice can prompt payment processors to suspend processing for sites that get investigated by the DOJ.

At a basic level, this appears fine. A company that is selling pirated material on its site and violating copyrights can get shutdown by this bill. Their transactions can get suspended, Google can be forced to remove it from the search engine, and its page ranking can be destroyed. For the sites out there trafficking in online piracy these measures are extreme and effective. Which would speak to the proposed law’s effectiveness.

Unfortunately, the bill is extremely open-ended. And this is where the anti-SOPA sentiment gets its fuel. Creating a hypothetical that focuses on a merchant processing and small business perspective, here’s what can go wrong with SOPA the way it is currently worded:

A small business launches its website.
The site, in an attempt to reach out to its customers has a forum or social media section where its customers can post discussions. The intention of this tool is to create links between the business and the customers.
A poster on that site’s forum/discussion area posts a funny, home-made YouTube video. That video contains copyright infringement.
The YouTube video gets reported for its infringement.
Suddenly the site is under investigation under the purview of SOPA, and now this legitimate business gets its site shut down and its processing suspended. The business can’t make money anymore because of reports related to ancillary content on its site — not actual piracy.

This may seem a bit extreme. But the way most “arguments” or “discussions” can go on the internet, it’s pretty standard fare that stuff like this will happen. And if the DOJ takes a broad stance on this kind of interaction, sites will face interruption based on reports that do not involve full fledged piracy.

What it boils down to is the bill leaves a lot of loopholes available for websites to be griefed by random internet users who may have an agenda against a particular site. And the DOJ may or may not be tech savvy enough to navigate this type of abuse.

Recent News on SOPA

Here’s a roundup of the most recent news items that focus on SOPA:

cPanel Writes a Letter

cPanel publishes a general letter to hosting providers speaking out against SOPA. In the letter they state: “While created with the good intentions of combating widespread copyright and trademark infringement, cPanel opposes these bills for a number of reasons due to their impending negative impact on hosting providers around the world.” The company then pledges $5,000 to the Electronic Frontier Foundation, which has been fighting to preserve individuals’ digital rights since 1990. In addition, for every tweet our hosting providers post with the hash tag #cpanel4antisopa, cPanel will donate an additional $2.50 (up to a total donation to the EFF of $10,000).

WordPress Says No to SOPA

WordPress, the open source giant that powers blogs throughout the internet, took an official stand against SOPA. You can read the article about WordPress and SOPA here. It’s written by Jane Wells and posted on WordPress News. WordPress is another of a number of companies which now officially oppose SOPA; already Facebook, Google, Yahoo!, Mozilla, LinkedIn, Twitter, eBay, AOL, and Zyngahave said that they don’t support the bill. The WordPress article is a call to activism among bloggers to organize and take a stand against the bill.

GreenHostIt Joins the Anti-SOPA Side

Hosting firm GreenHostIt released this press release officially announcing their opposition to SOPA. The release quotes company CEO S. Rosendahl as saying: “SOPA, if passed, will infringe on business owners’ rights and diminish that spirit. I really dread getting the court orders that will probably come to us if this proposal passes.” Mirroring much of the analysis Host Merchant Services has given the proposed deal, Rosendahl also comments: “People who operate websites that will be ordered shut down by uncontested applications will be very frustrated and angry, and for good reason.”

Teen Makes SOPA Plea to Santorum

The Washington Post reports that SOPA has become part of the GOP Presidential Nomination race going on right now. Presidential candidate Rick Santorum was approached by a teen in New Hampshire, and as the article states: “A teenage boy implored Santorum to look into the Stop Online Piracy Act, saying a friend of his might go to prison for five years for posting a cover version of a song on the Internet.” The Washington Post determines that due to instances like this the biggest threats to America — or at least the hot topics for American voters — appear to be online piracy, an insidious United Nations and “crony capitalism.”

Host Merchant Services Partnerships [2023 Update]

Today The Official Merchant Services Blog gives the floor exclusively to Host Merchant Services. The topic being Partnerships and what the company offers with its partnership programs.

What are Partnership Programs?

The bulk of the payment processing providers out there offer individual services directly to merchants and their specific businesses. Host Merchant Services, the premier provider of payment processing and e-commerce services for small businesses and medium businesses, goes beyond just the vanilla suite of services –– providing custom partnership packages for niche market clients.

What this means is that Host Merchant Services will partner with a business to help that business provide payment processing services to the customers of that business. That’s the basics of the partnership, but the power of the partnership is expressed in how the focus of the partnership can shift for the business in question.

Host Merchant Services can customize a partnership package in three different tiers of online shopping and e-commerce services:

A package made directly for a web hosting company so that they can in turn offer services for their customers who all have online shopping sites in some shape or form.
A package made for a web site designer that can combine with their design business so they can offer their customers a seamless site with strong design and payment processing options right from the day its ready to launch.
A package made for the end-user specifically set up for a customer that has an online shopping experience set up and is ready to integrate payment processing.

Host Merchant Services Expertise

This customizable and flexible series of partnership packages are based on the experience that Host Merchant Services has in both industries –– company CEO Lou Honick launched HostMySite.com in 1997 which grew to be a successful web hosting company, and company CFO Dan Honick has decades of experience working in the payment processing industry. Combining that much experience in both aspects of the industry has given Host Merchant Services its unique partnership program’s foundation.

Web Hosting Partnerships

Host Merchant Services began an initiative to provide web hosting companies a fast and transparent third party solution for processing credit cards. This initiative is the core of their partnership program offering. And to date, the company has partnered with these various hosting companies:

Singlehop
imSMB
Gearhost
Edge Web Hosting
HostMySite.com

You can find out more information for each individual partnership here. And you can find out about the details of the Web Hosting partnership package here.

A Bit of a Homecoming

The most recent addition to the list was HostMySite.com. It’s a bit of a homecoming for Host Merchant Services CEO Lou Honick, who originally founded the company in 1997. You can read a full press release about the partnership here.

The Other Customized Packages

Beyond just the partnerships custom built for web hosting companies, Host Merchant Services offers solutions for web designers and web site owners. You can find information on those options at these links:

The thrust of these partnerships is to create the payment processing package that makes it easiest for the partner’s customers. Host Merchant Services plan is to do the heavy lifting for the company making payment processing a seamless, worry-free addition to the services they already offer their customer. They also contain value added features, such as additional telemarketing services provided by Host Merchant Services for their partner company to their customers, to give each partner extra insight into what their customers need.

What the Partnerships Offer

Each partnership has a set of basic services that Host Merchant Services can provide:

A fully designed portal site customized to your specific company.
Increased revenue as your customers can now utilize HMS processing services through your portal site.
Savings for your own company through our processing services.
Access to the gateways and technologies we support for e-commerce, including HMSExpress, Transaction Central, and authorize.net.
Assistance integrating the gateway into your website, your customers’ websites, or your shopping cart.

Building off of that base of services, Host Merchant Services tweaks and customizes each package to suit the individual partner. The company adds extra marketing services, SEO analysis and integrated telemarketing for partners that are interested.

Merchant Services: Chargeback Tips

The Official Merchant Services Blog focuses today on an aspect of payment processing important to both merchants and processors: Chargebacks.

Chargebacks occur when the amount of the original charge that was credited to a business’ checking account is reversed. The chargeback is forcibly initiated by the consumer’s issuing bank. Realizing that chargebacks can gum up the steady flow of cash for your business from day to day, Host Merchant Services gives you some tips that you can take to help understand chargebacks and help you prevent them from happening.

Common Reasons for Chargebacks

Here’s a roundup of the most common reasons a chargeback is filed:

The card was fraudulent.
The cardholder disputes the quality or receipt of merchandise.
The amount charged to the card was incorrect.
Processing errors were made during the transaction.
Proper authorization was not obtained.
The merchant did not fulfill a retrieval request.

Although chargebacks cannot be 100% gotten rid of, there are some steps that merchants can take to drastically reduce their occurrence. The more a merchant knows about processing procedures, the less likely it is a merchant will do something — or not do something — to prompt a chargeback.

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Procedures for All Businesses

The first tip is pretty basic. Make sure that the business name you provide to your processor is a name your customers will recognize. This is the name that shows up on their statement. So if you happen to be Bob’s Widget Store, but the business name you provide is Really Cool Stuff LLC, you will run into increased chargebacks because your customers will not recognize the name when they get their credit card statement the next month.

Respond to retrieval requests. Both customers and card issuing banks may request copies of sales and credit drafts. Once a request is initiated a merchant needs to respond within 12 business days. Make sure your business is structured to be able to provide this paperwork quickly and easily. Wells Fargo recommends sales drafts should be accessible to authorized employees for 180 days after the initial chargeback notification after which they should be stored long-term in a safe and secure location.

Always get an authorization. This very basic but does need to be said.

An image for a Host Merchant Services Article on processing

Procedures for Retail Businesses

Retail merchants should make sure they fully comply with the transaction requirements issued annually by Visa, MasterCard and Discover Network.

Have proof the card was present by making sure you swipe all cards through your terminal.

Get a signature from the cardholder and compare that signature to the back of the card. Check additional identification if needed. If the card is unsigned, request a photo ID that has a signature and have the cardholder sign the card. Otherwise, do not accept the card.

Get an imprint whenever a card has to be manually keyed into a terminal. Make sure all of the transaction information appears on the imprinted copy –– including the amount, business name, business location, and cardholder’s signature.

If a card is declined when swiped through the terminal, do not continue to try and get authorization. Instead request a new form of payment from the cardholder.

Verify that the number on the screen matches the embossed number on the card.

Pay attention to Partial Authorization, as that can create instances where a payment gets broken into smaller amounts. For full information on Partial Authorization, you can visit Host Merchant Services article on Partial Authorization here.

You can also download Partial Authorization Guides from Host Merchant Services here.

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Procedures for Internet and Mail Order/Telephone Order Businesses

Use the Address Verification System (AVS) to ensure that your customer is providing you with the correct billing address. Discover Network requires AVS on all card-not-present transactions.

Provide your processor with a local or 800- number that they can include on your billing statement. Supplying this number for your customer will often help prevent a chargeback from occurring. Your customer can contact you directly with questions and you will have a chance to correct any misunderstandings quickly and efficiently.

When sending merchandise to a customer, use a shipping service that will be able to provide proof of delivery to the full billing address. For very expensive items, request a signature for the merchandise to be released to the buyer.

For more information please contact Host Merchant Services. Our quality assurance team can help you understand chargebacks and reduce the number of disputes you have to deal with.

Florida’s Proposed E-Commerce Bill

Today The Official Merchant Services Blog is taking a look at a new bill proposed in Florida that attacks the growing E-Commerce industry. The bill — HB 861 — was filed by state Rep. Mike Horner, R-Kissimmee. The bill would require online-only sellers to collect and remit Florida sales taxes, just like other Florida retailers.

Bricks vs. Clicks

This legislation is drawn on the battle that has been brewing for the past decade between brick-and-mortar retailers and online entrepreneurs. Online shopping has become commonplace for the U.S. consumer, and this year’s holiday shopping season saw record business run through E-Commerce.

The Official Merchant Services Blog did a series of posts based on the strength of the E-Commerce industry. In it we reported that in recent years, the boom in online shopping created a shift in shopping trends. Holiday shoppers no longer adhered to Black Friday as the start date for their holiday shopping needs. A 2010 survey conducted by Google and OTX found that 35% of internet users start their holiday shopping prior to the end of summer, months ahead of Black Friday.This shift continued to grow in 2011 as consumers found online shopping extremely convenient.

According to a Star Tribune article from January 16, 2011, Cyber Monday sales rose 16 percent from 2009, and topped $1 billion overall –– marking the first time Cyber Monday hit the billion dollar mark. The record setting didn’t stop on Monday, according to comScore, a company that tracked the sales figures between November and December for the e-commerce industry. Sales on Thanksgiving Day were up 28 percent from the previous year, and overall e-commerce sales topped $32 billion in the holiday shopping period, a 12 percent rise from 2009. Even Black Friday, brick and mortar stores’ biggest holiday shopping day of the year, saw a 9 percent rise in e-commerce to $648 million.

2011 saw those numbers rise even higher. Statistics released from an IBM research unit called Coremetrics found that 20% more consumers shopped online this Black Friday 2011 than did in 2010. The data collected also states that 39% more online shopping happened on Thanksgiving Day itself in 2011 than in 2010.

Trying to Level the Playing Field

The boom in online shopping is what has prompted this bill to be suggested in Florida. In Florida, online retailers are escaping the burden of sales tax for their transactions. And so the bill was created to attempt to level that playing field a bit. According to this bizjournals.com article by Susan R. Miller, “Currently, Florida retailers with a brick-and-mortar location are required to collect and remit sales taxes on purchases made online, while their online-only competitors are not. The bill would require online-only sellers to collect and remit Florida sales taxes, just like other Florida retailers.”

Miller’s article says that the bill has support of the Florida Alliance for Main Street Fairness, a coalition of small businesses, trade associations and civic groups, including the Florida Retail Federation, Florida Chamber of Commerce and Associated Industries of Florida. The legislation could be part of a larger initiative this year by states nationwide that would require online retailers such as Amazon.com or Overstock.com to collect taxes for online transactions.

The article does note that the bill faces one large obstacle in the local legislature: “However, Senate President Mike Haridopolos has said that such a plan would violate the Florida Legislature’s “no new taxes” pledge and would not pass if it resulted in a net increase in taxes collected by the state.”

Is This the Future?

The suggestion that this is part of a large initiative to attack E-Commerce giants like Amazon and Overstock is certainly of interest. Especially since a large scale move such as that would have a deeper impact on all of the smaller Online Shopping sites that small business people run around the U.S. But there’s some key facts to keep in mind before getting too worried that this is the next big thing like the Durbin Amendment was in 2011:

This is a state bill, not a federal proposal. That means that this is still a very small scale approach.
Florida law isn’t exactly cutting edge. Not to be flippant, but there’s a reason why snarky internet commentary site Fark.com gives Florida its own subject tag.
The bill itself does, as the story states, face some opposition in its own state legislature because of the tax issues.

You can review the exact language of the bill by downloading the PDF here.