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Allen Kopelman CEO Nationwide Payment Systems
B2B Vault Episode 56: Allen’s Business Journey

Written by admin

March 2, 2022

Video Transcription

Hey, it’s Justin with B2B vault, the payment technology podcast with your host, Allen Kopelman, he’s providing you educational information about business payments, FinTech, and the technology businesses need in today’s world. In today’s episode, we will be talking about Allen’s business journey over the past 20 years. Pretty cool stuff. Hey, thanks, Justin. No problem. Our right. So let’s get into it. So my business journey, so I thought this would be interesting to talk about because people always ask me, oh, where are you from? And, how did you get into this crazy credit card processing business? So I was born in New York, and my parents decided in 1968, let’s move to Florida. So we moved to Miami. And then later in 1978, I moved to Atlanta, Georgia, and I was in Atlanta, Georgia. We will talk about what I was doing at the beginning of my working career in Atlanta. And then I left Atlanta and 1986 and moved to Dallas, Texas, and worked out there for a long time. Then, in 1992, I came back to Florida.

So now, let’s get into all the crazy stuff. New York, my dad, I was born there in Brooklyn. My dad was in the garment business. So I grew up all around a business where my mom’s dad owned a factory in New York, and they knitted sweaters and that. Then my dad and my mom’s brother had another factory, and they needed a band lawn, which was this stretchy material, you know, in the 1960s, you probably saw like, if you watch the show, my three sons, they wore like the stretchy shirt with like a big Stripe on it. Maybe on happy days, he saw Or my time than 41. But I mean, I remember what it was? Happy days. I remember fines the font. Weren’t They From Milwaukee? Yeah, they were from Milwaukee. It’s my home town. Right? There’s a bronze stand statue of the Fonz on the Milwaukee River. In the walkie. Okay. One fun fact about Milwaukee. Yeah. My dad and uncles were all in business. They all had factories, and my dad’s dad was involved in the business. He lived in Boston and Rhode Island, and my grandfather’s brothers were involved in all kinds of businesses. When I was growing up, one guy at a clock factory, one guy at a book bindery company, a deli luncheonette. Rocky, what’s going on today? Rockies luncheonette, a flower shop, a guy in a clothing store.

So they had all kinds of businesses, you know, and all the time, you know, we go to the, my dad’s factory, me and my cousins would take boxes and make tunnels and all kinds of crazy school. Then we ended up in Miami, and my dad opened up many clothing stores down here. So he had clothing stores on Miami beach. So I grew up, you know, I went to elementary school, junior high, high school. And during that time, you know, I would go to my dad’s stores and help him with the cash register. And talk about that later with a credit card bra. I remember my dad started to take credit cards, and it was crazy. He had an imprint machine and a little book. And we’ll talk about that later. That all evolved, and it was crazy. And then I had uncles down here. One uncle had a flower shop. One guy was an attorney. My other cousin owned a bunch of hotels and stuff. So, you know, business all the time, we decided I ended up in Atlanta. And when I was in Atlanta, I started to get involved in the restaurant business. I liked the restaurant business. It was kind of, it was a lot of fun, and I didn’t really like college too much the first time. And so I got involved in the restaurant business, and I was doing that for several years. And I decided that I wanted to be a chef. And it wasn’t feasible at the time to go to the Culinary Institute of America in New York because they only took a few hundred, maybe a hundred students a year.

So it was challenging. But at that time, now it was a massive college, and there were other colleges. But at that time there was, you could go to Johnson and Wales or the culinary Institute. I found out that you could do this program through the local Georgia state university. It was a three-year apprenticeship program where you attended college, got, and then had a job. So I went around and applied for jobs, and I got a job at a place called the capital city club, a private dining club. I worked for some chefs there. Some of them were cool. Some of that we’re crazy. And I did that for three years, and I graduated from my program. At the time, Georgia State was basically like a certificate. Then they upgraded it to a substantial degree. But by that time, I was already an executive chef in a hotel. And that happened later. So I left Atlanta after I graduated from my culinary program. And I went to Dallas. I started working at restaurants and hotels there. When I was in Dallas, I was named twice among the top 10 chefs in Dallas. So at one restaurant called laurels on the top of the Sheridan hotel there. And then the Melrose hotel was named one of the Ten Best Restaurants in Dallas. And I know it was written up in many magazines and all that.

And it was, you know, it was you know, people don’t know like when you’re a chef, you know, you’re also like a business person because I was in charge of which I didn’t realize, you know when I started to, you know, do in my career. But as I became like the head chef at my first hotel, you know, I was responsible for about 75 employees. I was responsible for two restaurants: breakfast, lunch, and dinner. One was open for lunch and dinner. Plus, there was a bar and all the banquet facilities, you know, I talked to customers. I had to go to all kinds of meetings. My boss sent me to Dale Carnegie because I needed to learn to have my voice, you know, become the I’m the expert. So I became the expert, and then I went to another hotel and the same thing, I was in charge of a restaurant banquet facilities bar. And you’re in charge of millions of dollars because we’re buying food, we’re buying liquor. You know, we make all the decisions on that. Later, when I was in Dallas, I worked in the consulting end of the food service business, which brought me back to south Florida. So I moved back to Fort Lauderdale, and I was working for a consulting group, and we were doing consulting to hotels and country clubs and all that. And we set up buying and all kinds of things for these places.

So we were the ones that we would go out and negotiate all the contracts from foodservice companies that they’re going to provide food, you know, provide the food for these places and get them the best prices based on, you know, our, the contracts that we had plus whatever they were going to buy. And we showed them how to organize. Like, let’s say you have ten hotels. Well, you buy a lot of catch-up coffee and certain things. So you can get discounts because you can go Rocky. You don’t like that. You can go to the manufacturers and work out discounts on your coffee and certain things that you buy a ton of French fries. So you get all your hotels to use the same French fries. You get all your hotels to use the same champagne for Sunday brunch. Then you can get massive discounts because you can get discounts back to the manufacturer who sells to the distributor. And then that distributor adds a small markup because the manufacturers agree to sell for a better price. So I learned a lot about contract negotiation in those days and how to do, you know, different things and deal with lawyers and all kinds of stuff.

So that was, you know, an exciting time. And then, I opened a restaurant, and my restaurant was named one of the ten best restaurants in Palm beach county. It was called food amongst the arts. That was pretty cool. And yeah, here’s a picture of me when I was a chef. And this is from the Palm beach post. And this was from another business magazine. I got tons of these things. I got a bunch of them hanging on the wall in my office. Everybody’s always surprised Justin can attest, you know, he asked me to make him I told him I would make him a vegetarian meal one day. It was good. So I prepared it, and he was surprised, and his wife was surprised that I had made something. So that was, that tasted very good. So that was my journey for, you know, from 1992. And then I was going to say; I kind of want to go back and ask you, like, Nah. So you grew up in New York, right? When did, how long Were you in New York? Oh, only till I was eight. So you lived in New York, tier eight, moved to Miami, and then stayed in Miami While I was 17 In Atlanta when you’re 18. And then you stayed in Atlanta Until I was 26, and You moved to Dallas. Right. And then you stayed in Dallas Until I was 32. So about six years in Dallas. Yeah. Six years.

But I still worked for the same company when I came back here. So, So that’s a, that’s like a nice chunk of your life and every time. Yeah. And it was interesting. I also got to travel around the country when I had my job at the hotel company. A lot of people, no one can pick out my accent. Some people like notice, like the way I talk, oh, it’s very New York, or some words sound very Southern. And that’s the New York, the Atlanta, and the Dallas, you know, but I like that I lived in different places. I got to experience living in New York, you know, cause I would go back there sometimes for business, and I got to experience going to different cities when I traveled in the hotel business. So you would expect, you know, not just go in there for the day, I would go there and work for a week or two. So, you know, so you would, you would get to experience the culture, the people, the food, like we would have to make a menu for a restaurant in California. Okay. Well, you know, I don’t know what they eat. What’s being served around the hotel. So I learned how to do that too. How to make a menu and decide what will go on the menu. What are the local foods that people eat? Things like that. Like we opened the hotel in the city. You have to have Kansas City steaks. Right? Yeah.

You have to have like, what are the foods that they eat? What are the side dishes? I don’t remember them all from back then, but it was a while ago, but you know, we went out, and we investigated like, oh, what’s the best places to eat and what are the side dishes? Do you know? And then I decided, and 98, I made a big shift from being a chef to sales. The first foray I had into sales was working for went, huh? What led you to that? Yeah. Well, so I was getting tired of working. So the days a week for the hotels, no, I was working for myself at that time, but I was working literally like seven days a week. I had a restaurant, you know, during the season down here, you have to be open every day. Sometimes, you know, I would like Sunday to stay close for logging was burning you out. Yeah. Cooking burned me out. But you know, one thing you learn within the restaurant business is good work ethic, Or you gotta bust Your book. You have to have a good work ethic. You have to be a people person because no matter what, even if you’re cooking in the kitchen or, you know, you have to still talk to the customers as the owner or the chef, whatever, but you still got to, everybody has to get along. You have to get along. That’s one thing I learned in the hotel business; everybody has to be happy from the server, the dishwasher because if somebody has a bad day, you don’t want to spread that out because then the customers have a bad day. You know, I learned about customer service. Right. So when you were, you know, did you have an idea you’re going because your family was in so many different businesses.

I do automatically know you’re going into business or did you just, you know, say, Hey, I want to try something new, and you know, what, what No, what happened was, you know, I’ve decided I want to be in the restaurant business. I tried to move my restaurant to another area, but it didn’t work out because I didn’t have liquor in my restaurant. I knew I needed to have liquor to be successful, you know, to level up my success. Right. But that was down here. Yeah. That was down here. And I tried to move up to D from Boca to Del Ray, but they did not have it at the time to have seating on the sidewalk. And then, because you couldn’t put seating on the sidewalk in those days, back in those years, that wouldn’t allow seating, and the sidewalks didn’t have enough seats to get the liquor license. Oh wow. Many restaurants were going out of business because they didn’t have a liquor license. So if you didn’t have a liquor license, you know, liquor, high-profit item in a restaurant, How long was the transition from chef to business owner? I guess business, I mean, starting a new business. No. So what happened was, is I was still doing chef stuff. So I had catering jobs, and I was doing other stuff involved in that business. And I was talking to a consulting company about going to work for them. And I had old clients from when I did consult. So I was writing some menus, and part-time, my friend said, oh, you should do this credit card processing thing.

So I went around; I talked to many companies about credit card processing, and they ended up hiring me. That’s where I met my business partner, Dave, and I started working for them part-time, and I was like, well, you know me and Dave went out in a couple of days. He was already working there for a couple of months. So he took me around, you know, I watched what he did, and I was like, I guess I can do this. So I was doing like, so I was doing that part-time and doing some chef stuff part-time and then I decided at the end of 2000 that, you know, they were not the people we work for. You know, I learned a lot, but they were not into, like, people were asking me for like gateways and e-commerce processing and stuff like that. They didn’t; they didn’t want to do it. And I was like, you know, turning away all this business, you know, turning away business all the time. So I had one day I went into one place where we bought equipment from, and the guy there he’s like, oh, you’re brilliant. He goes, you let me give you these magazines. So he gave me two magazines called the green sheet. It’s an industry publication. Would it be something regular people would read? And I saw ads in there. I started calling up the ads, and then I figured out how to start a payment processing company signed a contract with a bank. Dave and I went to his parents to help us. They were lawyers at the time.

They’re retired now helped us incorporate boom. We found the office down the street from where we are currently. And we, and we went to the, we had a fun time with the landlord. The landlord was funny. He’s like, oh, if you can call it, he told Dave, if you could call your mom and your mom can tell me on the phone that you two are good boys. He goes, I’ll give you a month’s free room. Dave called his mom up and told him to talk to this guy. And he said, are they good boys? And his mom said, oh yeah, there’s are two good boys. And so he had to give us a month’s free rent. Nice. We gave them first and last month security, but we got free a month. And we got started in business January 2001. So thank you. We’re going to have a little commercial. Thanks for listening to the B2B vault. the last podcast was called the subscription economy. So if you didn’t catch that one, go back and check that one out, but you can catch B2B vault on all the podcasts networks, Spotify, Apple, Google, YouTube, iHeart stature. And we’re also now on Pandora and Amazon Music, and follow us on social media. Check out the website, B2B vault.info. So, in 2001 January, nationwide payment systems were born. And, you know, we started our journey into payment processing, and you know, all the changes that have gone on in this business are kind of, it’s quite crazy to get back into those changes. I feel like we’re w we’re missing a slide or something. Okay. About nationwide payments, so as you and Dave and you started in 2001, right? And so you’re working out of an office. Yeah. And It’s a small office in Fort Lauderdale.

Around that time, how many payment processing companies were there in Fort Lauderdale? Oh, there was a lot, cause there’s a lot of people that sell payment processing, you know, I mean we had an office, I think we had like two desks, maybe like a small conference room. It was tiny, and we had one computer day brought from his house. Some guy down the hall helped us hook up the internet. We had a fax machine, and that was it. That’s how we started to hit the ground. Running, hit the ground, hit the, hit, the ground, hit the ground running. You know, we just lined every, you know, we lined up everything that we needed, and we went out and started hitting the streets and making and making sales, you know? Do you remember the first big client you signed up? I remember the two biggest clients that we ever signed on. one guy called us out of the phone book because we had an ad that said we fixed credit card machines in the yellow pages. And they said, oh, we have broken credit card machines. And we went there. Dave went down there. He got about seven or eight credit card machines brought them up to the office.

I took them out to the place that fixed them. In those days, it was about 40 bucks to fix each machine. And in those days, I used to swap them out. They’ll do that. They stopped doing that. After a while, they would back it up, and you would give them a broken one. They give you one back for like an extra five bucks. You don’t have to wait a couple of days to get your machines back. So I went there and got all these machines. We ended up giving them back to the customer. They ask us to fix a few more machines for them. We gave those back to the customer. Then they were opening up some more stores, and it was a big shoe store chain. That’s out of business. Now it’s called traffic. And we started to get them as an account around that same time. I got find out that a guy that I knew somebody that worked at a big restaurant on Miami beach. And I went down there to see these guys and the owner. He was like, you have five. He goes, you have five minutes to tell me about yourself. That’s it. After I waited for over an hour and a half, they got sort of the appointment, and the elevator pitches real. Right. So, boom, I go into my pitch, and the guy says, okay, great. And he gives me statements. He owned a few restaurants and gave me the statements for the restaurants.

I had the girl make the copies. I had to wait around for that. And then, you know, and then you know, came back to the office and I started figuring out like, how much were they paying and how, and then, you know, and then I decided, you know, okay, this is a massive account, few hundred thousand dollars a month, each restaurant. And so I go back there, and I show them how with this new fangled pricing that they never heard of before we just started using it called interchange pastor, nobody was selling that where you just paid interchange and then the pastor, and then and then a little amount on top. So I go back, show them how much money I’m going to save them. The guy goes, that just sounds too good. That’s a lot of money. Okay. Because they were on three-tier and it was expensive. He goes, we’re opening a new restaurant. We’ll give you the new restaurant. Okay. Should I say the name? So big name or prime? One 12 on Miami beach. We don’t have the account anymore. That’s a whole other story. EMV did that in. But you know, so they, I signed the accountant, and the guy’s happy after two, three months, I go down there, and I go, you know, quietly, you know, the guy says, okay, the other company at the other place wants to raise the rates. We’re switching everything to you. So they switch everything over a pickup, three, four more restaurants. And let me tell you these places, they were doing few million, like two, 3 million a month at that time altogether. So that was like our biggest account.

The shoe store guy got up to about 120 stores all over the United States. They were in New York, Texas, Georgia, all over the blank traffic. Yeah. I’ve heard of it, but that’s cool. It was like a, of fashion shoes was most of the shoes and flip, oh, it was cheap. Five bucks, ten bucks, 20 bucks, like a Payless type of deal. But, but more fashion high-end hot, like copies of Ferragamos. So it was pretty it. Yeah, but it was crazy. But their average sale was probably like 35, 40 bucks, but you know, and they were, and that was busy. One time the guy said to me, he goes, oh, aren’t we a big thing? I’m like, yeah, it’s a big account. But you got a hundred something locations. I got a guy with like one restaurant that does more business than your whole chain, you know? So your thing is much harder to manage, but you know, they grew to like during the time like traffic, we started as just a credit card machine. And when we went to them, and we said, you know, you should put in debit because that a lot of chargebacks and stuff like that. So where you put in debit and debit because you have these small transactions and it’s a lot of young people, and they put in their PIN, and the guy said, oh, we’ll try it at a few stores. They liked it. So then boom, they gave us, we got like, we started getting a few stores, new ones that they opened. And then finally we got about 10 or 15 stores. And we’re like, Hey, once you give us the, you know, the ones that we don’t have that are local and here. But once we were all over the place, Naples, Tampa, Orlando. So then they gave us the rest of it. And then they grew and grew and grew. And they were open up in the store every couple of weeks, not every day, and they were just banging them out for a long time. But they went bankrupt.

That was the end of that. They were a customer for a long time, so we got you started. I started, that was one of our first big accounts that made a big, and I bet you, that’s a good segue into what we’re going to talk about now because like all the exchange. Yeah. So they went through like a massive amount of changes at traffic, you know, but they went through, and we can talk about that as we go through this thing, like all the changes that day, I do experience as a business. Right. You know, but applications, when we first started, we had a folder that folded out four sides, right. And you had to press hard, and there was a white paper, a yellow, a pink and a green. So you had to press hard and fill this thing out. And then the merchant had to sign all the four things. Then we used to take Polaroid pictures, not how expensive that is. Let me tell you. We spent a ton of money on Polaroid camera, film, and FedEx. So then we would have to take that paperwork, give a copy to the client, keep a copy for us. And then one copy would go to the bank with the Polaroids, and we’d have to overnight it. Then they would get approved. We would get the programming sheet back in those days, they would fax it over, and then we’d have to download the machine over a phone line.

Today, boom, we have somebody fill out a pre-AP on our website. They click the link, you know, NPS bank.com/apply, right? Click the link fill that out. We get it, review the information, plug it into, we plug it into our online portal, and it sends out an electronic application. The merchant clicks a button, you know, signs, electronic lane, boom, everything goes over to the bank. AI takes over, then boom. And the account is approved in like 10, 15 minutes. And we’re ready to go. In most cases, for retail restaurants, things like that, you already have a merchant account. You know, something e-commerce could take a little bit longer, but the equipment changes like, and traffic is a great example. So like, you know, at first they had a lot of terminals where it was like a terminal, a pin pad and a printer all separate. Now we switched them to one unit, which was called the hypercar. And the hyper gum was this one unit, and it had the terminal and the printer. And then you just had a pin pad on the side, you know, but they were on dial-up for years, you know, then we added in a gift card to their system. So they went from, you know, hyper calm to another terminal Nuri so we can put gift cards in there. And then they had gift cards at all their stores. So you could buy a gift card at a store in Miami and use it in a store in New York. It matters or whatever, you know, any store because we were all connected.

So that was like, so then we went through many changes, you know, and then we went from dial-up machines to where machines could be hooked up to the internet. Merchants were freaking out because people didn’t have internet. The internet was costly. It would be like 3, 4, 500 a month put on the internet. So, many people didn’t have internet, you know, and there was a wireless and those days, you know, and the pin pads went through all kinds of changes because the pin pads went through all kinds of encryptions. They call them. So there was a master section master session. Then there was duck putt and corruption. Then there was tripled as corruption. And then we went to EMV. We’re getting into that later, and then, you know, it went from these simple terminals working on a phone line or over the internet. Now the terminals are all went from, that went into a completely different kind of terminal. Now, most of, I would say all the terminals are Android-based. Even if they look like the older terminals inside, most newer ones are Android-based. And what’s funny is, it is like the brands that we used to sell. So in the beginning, we sold their hyper phone com then Nuri, those things are gone, we don’t even, you don’t even hear about these companies anymore. They’re like very not relevant of the business. Now it’s packed Deja VU. A new company named Valor and some others are out there. So it’s exciting how the equipment all changed, you know? Suddenly, wireless terminals do, you know, put in the 3g 4g. Now we’re up to 5g with the cards, and terminals can run on wifi. A now merchant doesn’t have to run a wire. They can put an internet now they don’t have to pay some guy like a hundred, 200 bucks to run a wire up to the machine anymore.

Nice. I just tell them like, oh, you don’t need to run a wire thing. Just hook it up on your wifi. It’s great. It’s awesome. You know, milestones and credit card processing. The advancements in credit card processing are like really crazy stuff. So we started in 2001 in 2004, they came out with this PCI compliance. But even though they came out with it, it took a while. I think it was another four or five, six years before they started making merchants fill out these self-assessment questionnaires and all that. But they started with this whole PCI compliance thing personally. I think it’s good and bad PCI compliance. It’s good because merchants should know about it. It’s bad because it’s way too complicated for the average merchant. So, but it’s made simpler with EMV, you know, then 2005 was a major lawsuit where Walmart sued Visa, and they said, you’re charging us for regular credit cards for the same price as you charge us for these debit credit cards. So the debit card was these new credit cards that came out in the early two-thousands, whereas linked to your back to your bank account. So Walmart said, oh, you should charge us less money.

Do you know? So it’s not just Walmart, everybody, all of the merchants. So then, Visa and MasterCard introduced the debit card rate. What was the logic behind them? Charging them less money because it’s a debit card because it’s coming right out of the COVID right out of the checking account. So they’re not issuing credit for that. I, you know, it’s not an unsecured credit. So Walmart took you to know, went to court, took visas to gore, fought them tooth and nail. And then there was a massive settlement. Merchants got letters. We helped many merchants get back thousands and thousands of dollars, traffic back, and the insane amount of money through. Yeah. Our restaurant client got back a lot of money too. Yeah. We showed them how to fill out the paperwork. We, we learned from the bank, fill this out. There’s a lawsuit going on that we’ll get to in a minute. Then when 2010, it was the whole Durbin amendment as Durbin amendment goes back to two guys, two guys who had a camera shop. I think it was in California. And their whole thing was, oh, debit. It’s priced way too high. And it should be priced lower. And Walmart got involved in it. And this guy, Dick Durbin, I don’t like him. He’s some Senator, and I forget where, what state he’s from, but no, it’s the guy, and there’s Durbin amendment supposed to help small businesses. Okay. That is the biggest crock of BS ever. It did not help small businesses. A group put out a website called where’s my debit discount because all of these companies, Walmart, seven 11 gas stations, oh yeah. We’re going to LA, and we’re going to give people a special price when they pay with debit, that never happened.

That was all BS. And then, just all these big companies, they just pocketed the money. And the bad part was, is like we had a, we had a client at the time that a coffee shop. So the coffee shop average sale was like seven bucks, man. The guy’s credit card processing fees went from like two and a half percent to like 8% because they got rid of these small ticket interchange categories and made this Durbin amendment thing. So the Durbin amendment, yeah. That’s all fine. And dandy if your average sale on your business is above $13. Right. If it was below $13, an interchange of 0.05 and 22 cents was killer versus the old interchange of the small ticket. Which was 1% and a nickel, which is much less because that 22 cent system was murderous right on the ticket. So the rate, the coffee, the guy and the cough, these coffee shops, they just got murdered. You know that anybody with small average tickets with the Durbin amendment. And let me tell you, they should repeal Durbin. I’ve gone to visit senators people in the house of representatives. And at least if they don’t repeal Durbin, they should force Visa to bring back small ticket interchange for the merchants who have low average tickets because it’s a killer on them. They pay high fees with that, you know, and you know, well, but probably today, with the amount of inflation we have, I shouldn’t laugh. Inflation places with a $7 average ticket probably now have a $14 average ticket. But in 2015, this was major, major, major was this EMV thing. So it got put off, or it was getting put off and pushed back and put off and pushed back. And many merchants were like, no, we’re not doing that.

Blah, blah, blah. And then a lot of stories started to come out in the news that if you swipe the card after this October 15th date and someone wanted to get their money back or didn’t want to pay their bill, basically you’re done, you know, lose the charge, right. They call it an EMV fallback chargeback, and that’s still in effect. So that was a big, huge change. And everybody, we sold more equipment and tuber 2015 to the end of the year, then we sold the previous three or four years combined. Wow. Oh yeah. Everybody, we’ve been at a customer like a shoe store people. They didn’t want to change their equipment. And they were messing around negotiating with us. But I took a major chance and threw it down on my credit card to buy like 150 machines for them. And thank God because places were running out of equipment, and they were calling me up, Hey, you got these hundred 50 machines sitting here. Then finally the guy called me. He goes, okay, we want the machines. Then I called up, and we had all the files already done, and they started downloading them and shipping them out. And it was Bedlam. Merchants were calling us. Do you have machines? Do you have machines? Yeah. Cause places didn’t have machines, but we had a lot of machines because we pre-bought machines. So we were ready. And then, in 2016, Walmart decided they were going to sue Visa.

Again, this lawsuit has been going on since 2016, and now we’re in 2022. So that’s what four, six years. Okay. There’s not going to be digitally squat left because Walmart and a few other big retailers, they’ve already negotiated there, know what they’re getting. And then there’s going to be pit in this left after a look. Can you imagine how much the lawyer fees are after six years of lawyer fees and going to court and all that? There’s not going to be much left for the average small business, but I’ll tell you, like, don’t sign up with any law firms that are trying to get you to make money. There’s like another lawsuit with ATMs now, too, going around, don’t sign up with any law firms that tell you they’re going to get money from that. When the money’s going to get released, they’re going to send out a letter, and you’re going to get it in the mail. You’re going to fill it out, send it in. And if you’re going to get soft, then you’ll get something. I mean, I participated in something I got by like 32 cents for some, a T T thing. It’s like, what am I going to do at 32 cents? Like I took it to the bank. I’m like, is this thing real? And they were like, yeah. And I was like, okay, I put it in my bank account. Why should the lawyer get to keep the 30 cents? You know, an ATM’s the same thing. We went through many milestones when we started in the business, 2000, 2001. I think in 2002, we bought our first ATM. It took a long time for that. ATMT even where we’ve made our money back from that. So that’s a whole long story. I was in a gas station, and we had to take it out. Cause the person didn’t put money in it. Then we put it in another place. And then that place went out of business, and we made some money on that deal. And then we sold it to a nightclub, and it was in the nightclub until it got sold.

So whatever that one made money, we hit it big with ATMs. When the company we work with decides to partner with this cash program, we can load ATMs with the armored car. And then we grew our ATM business because we were able to serve as really high volume locations that are going through 40, 50,000 a week or every two weeks, or, you know, we have some locations that go through over a hundred grand a month in cash. And it’s loaded every, every seven to 14 days with an armored car. That was good, you know, and we’re helping those businesses out because it’s safer for those businesses. They don’t have to deal with getting cash from the bank and driving around with cash in their car, worried about getting robbed. You know, the guys show up from the armored car Brinks or Loomis, and they load the machines. Everything’s good. Another big problem with the ATM business was ADA requirements. And that also sucked out, bam. There were tons and tons of machines where the keyboard was too high for somebody in a wheelchair, and they made them re lower the machines down. And they were, I remember there was this one machine called the mini bank, and it was a tall skinny machine, but the keypad was way too high for, so those things, boom, all those one in the garbage can. And there were tons of them, not just those NCR ATMs; there were tons and tons of ATMs that didn’t meet the ADA requirements. Then some go on the wall. And when we sell them to people, we tell them, Hey, make sure, you know, it’s at the ADA, the keyboard is that day, whatever the measurement is, you don’t have to look it up. Cause we don’t sell many of those, some people mapped them on a wall. So you got to make sure it’s at the right height. Otherwise, you know, you’ll have some inspector come in or some lawyer that’s you know, looking for money, come in and measure your ATM. And then, oh yeah, don’t, don’t laugh. I remember I got a phone call one day from a client. It wasn’t even a client, just some guy he saw, I was in the ATM business, and he called me on the phone. He goes, Hey, I got some lawyers suing me. And I said, for what? And he’s like, oh my ATM. I came over there. I see the ATM up on the wall. It’s way up. I mean, it was high.

I was like, don’t you know about the ADA laws. So the guy moved to ATM, and he ended up settling for a couple of grand. Nice. And there was other, like, I remember, like they didn’t want merchants to print the whole credit card number on receipts. And lawyers were chasing after that to Sue and merchants left and right. We had like four or five merchants that got sued with that. They ended up just, you know, the lawyers like an ambulance chaser. They ended up having to pay the lawyer three, four or $5,000 just to get rid of them, you know, and, and ATM is also, you know, the went through like the EMV. So we had to change all the keypads on the ATMs and the readers on the ATMs. So some ATMs needed new keypads, and something needed a new reader. So we had to, and we got lucky because the company we work with went to MasterCard, and MasterCard said, oh, well, if you guys will switch, they made a deal with one of the manufacturers, and MasterCard purchased thousands of these EMV readers for HIO song machines. Thank God we had all those card readers. So instead of paying like $250 to $300 for the reader, we only had to pay a hundred dollars. So that was kind of nice, but it was still a big major expense. It was, we had to go around and replace them all, have a tech, go out, replace all these readers everywhere and reprogram all these machines and put new software and everything. The ATMs back in the day, just like credit card machines, were on the phone line. Then card readers were plugged into the internet IP. And then now we use wireless boxes. We have a little wireless box in the back of the machine, giving us remote access. We don’t have to go to the machine to do anything; an ATM can do more than ever.

You can buy Bitcoin on an ATM pay bills on an ATM. You can do all kinds of stuff at the ATM. Now payment process processing payments has evolved. Payment Processing evolved from a little square box sitting on the counter to POS point of sale systems, cone POS smart terminals, or Android. They could do more than ever, like the little Android terminal. I was more powerful than the first computer that you probably own. You know, e-commerce, this is another thing. Ecommerce is a growing, growing, growing business. E-commerce grew, especially during the pandemic. It accelerated e-commerce businesses, tons of e-commerce businesses blew up overnight. Every business out there needs to be on the internet with e-commerce. People use Gateways for all kinds of things connecting different systems and connecting your virtual e-commerce terminals of creating a payment portal. So you can have a, a portal where people click on it and they can pay their bill 24 7 invoicing, you know, using QuickBooks and Sage Intacct and other types of, you know, other types of accounting software, sending out an invoice, it’s connected to a little payment service. People can click on it and links, you know, texts, links, email links to make payments integrating all kinds of systems. So integrating into your ERP inventory systems, integrating into your accounting systems, integrating it into CRM systems, integrating into websites, and upgrading into all kinds of different software, right? That’s a big integration. We’re integration experts. So we learned to do that because that was a big thing going on. And it’s even big now, contactless payments, you know, cards, you can tap a card and pay. You can tap your phone and pay, but you can do all kinds of stuff with contactless payments. I mean, it was a joke when contact was payments first came out because they did them with RIFD chips. Now it’s with a different kind of chip. So that ship actress who touched the machine to work before there was radiofrequency and people were stealing credit cards. It’s crazy. There’s like a great video on YouTube of a guy walking around with a backpack. And he stole a hundred credit cards in a mall. So people from Visa were not happy. That s**t was, oh, I would never have. And then some companies made all those wallets, right? With the protect, your credit card, your RIFD chips.

But I don’t have an RIFD chip credit card, no way. The ones now are NFC near-field communication. They’re you must be literally on top of the machine before the RIFD chip, you could be waving the card like 10 feet away, not good, 20, 22. And beyond what to expect, this business is moving and moving faster. And the last couple of years that’s ever moved pay fax hybrid paybacks. These are going to be the new payment processors of the future. Anybody who has software, your independent software vendor, has a point of sale system. You have SAAS software. Whatever you have, you can become your credit card processor. We can show you how to do that. We align with several companies that can set that up, where people board in just like Stripe, PayPal square, and the online boarding process. And we’re going to see that with merchant services. Next, FinTech is ahead of us, but now merchant services will become FinTech and merchant service companies. That’s what we’re doing. We’re moving. We’re trying to move in that direction to do is that’s why we have our online application. So we can enable things to move, move very, very quickly soon. We’re going to see real-time payments, real-time payments. It’s happening now, but that’s wires, and it’s bank to bank transfers and things like that, but they’re, they don’t move fast enough. And it’s not widespread. And the companies who are doing it are charging a lot of money. I mean, I saw somebody paying 1% for that. I was like, what are you doing? You’re paying 1% every day on top of your credit card processing fees. I mean, how bad do you need your money? Like, nobody should need their money that bad. If you have a business and you need your money, like an hour or something, or you need your money, like the next day, you seriously need to look at, you know, your prices. You need to look at what you’re doing in your business because you got to have some cash flow. It’s a buffer, you know, in your business.

But real-time payments, I think, will be handy for like B2B. It’s going to be handy for merchants to get their money faster. You know, not everybody qualifies for these real-time payments. I mean, some of the companies are doing it. Yeah. If you’re a restaurant or retail or things like that, but I think it’s going to, you know, because there’s less chance of a chargeback, and those types of businesses push payments. Push Payments are a new thing. We’re actually in talks with a FinTech company because we want to offer push payments out to clients. Let’s say you have an insurance company. And instead of you sending an ACH or a wire to somebody, we’re going to have the ability very shortly, hopefully with this week, where you’re going to be able to go into a portal and send somebody money, you could use it for your employees. You could use it for all kinds of stuff, to push out payments for rebates, for insurance, all kinds of stuff, to push out payments, and it gets pushed to the person’s phone or their email. Then they can choose what they want to do with it deposited into their bank account, get it on a virtual credit card, put it on their debit card, or print out a physical check, which I don’t think many people do. But the PA the, the future is bright. There are so many innovations coming with FinTech. Okay. And you know, and FinTech is now getting into banking. And I think, you know, banking is being re-imagined before us. I see banks closing up branches left and right. Neo banks, which are these online banks, are growing and growing and growing. Some of them need to look at their KYC, which is knowing your customer because we’ve got people that apply for merchant accounts. They got a bank of its Neo bank, and then it’s completely bogus. The person’s in like Nigeria. Unbanked will have more options, especially with these like neobank options where there’ll be able to issue somebody like a debit card, right through a Neo bank. And then you could get your payroll deposited there.

Then, instead of being unbanked, you can be banked and have more access to banking services. Cryptocurrency will come in and become a way to do international transactions. You can look at what’s going on today. And the news with Ukraine, they can’t get money, but they get cryptocurrency and pay for whatever is going on over there. So crypto will soon become a thing to do for large transactions, large transactions, international transactions, and business-to-business transactions, especially internationally. It’s going to be big with cryptocurrency. And I think cryptocurrency over time that we might see as a digital dollar, but I think it’s a long way. I think it’s a lot farther away than the news that like the news talks about it, or they talk about it like financial markets. But I think we’re far from that like that happened decentralized finance. I mean, that covers all kinds of things. The metaverse the, multi-verse the web three, and FTS crypto exchanges. I mean, this is, you know, this is where the future is going with banking, you know, in cryptocurrency, like now, instead of, you know, people can do crypto to crypto change your crypto to cash, you know, things are going on with that. And FTE, marketplaces, people buying digital, digital images, digital collectibles, digital functioning tokens that get you. I was reading something about some conference, and they were like, oh, you can purchase our lifetime NFT.

And then you can get it to this conference for free forever. You know, where you get a special discount. A hotel in Miami said they were going to be the first NFT hotel. You know, I think it was called E V hotels or something. Kind of a cool concept. Yeah. So there’s a restaurant; we saw the restaurant in New York, you can purchase an NFT, and then you got special reservations and stuff at some high, super high-end restaurant crypto exchanges. We’re going to see tons and tons more of these crypto exchanges. I want to tell you we are not financial advisors. We do not get financial advice. Talk to your down and talk to your lawyer, do your homework, you know, make sure your crypto, if you’re doing crypto, make sure you have a good wallet, secure Yourself, secure. I mean, just, yeah, know what you’re buying. It’s just like anything else. You’re not going to go to the grocery store and blindly, you know, buy something without looking at the date on the product. Right? So you’re going to look at the coin that you’re going to invest in. And then hopefully it’s something that you want to spend your money on it. Yeah. My brother was telling me a story about a guy who invested in some coin, and it was $3,000. And then my brother showed me the coin on this app.

Show me some new app off to show that to you, just in a new app that tracks coins that aren’t released yet into Coinbase. It tracks it, but you know, you can’t buy it from there, but it’ll tell you where you can’t buy it. So we saw this coin and had the height. It was three grand. Now it’s like a dollar. Okay. The guy’s like flipping out like that. My brother told me he doesn’t be doing that. You know, it’s dangerous. Like, you know, crypto-crypto is dangerous. Like you go into crypto, you can make a bunch of money or lose the money. So if you’re going to play in crypto, it’s like the stock market, whatever you’re going to put in there. Well, I said the stock market is probably safer than cryptocurrency, but you know, they were interviewing a guy from FTX or something. This crypto billionaire guy that created was an FX to your FTX. What’s that one called the new one? They said they’re out of Miami. It’s a crypto exchange. I can’t remember the guy was trying to correlate it now, the Bitcoin trading. Right? Cause there’s a lot of people that day trade Bitcoin, Bitcoin cash, like going into Ethereum. So they’re day trading it. And he’s saying that it’s, it’s trying, it’s trending very close to the stock market now, which was kind of interesting. I don’t know if I subscribed to that, you know, because the guy’s a Bitcoin guy, right? So he’s going to be Bo would they call bullish, bullish? He’s going to be bullish on the coin. What’s next for merchants. I’m going to tell you that for years we’ve heard, oh, we’re in a global economy, but I can tell you if you have a USA only domestic merchant account and you accept a credit card from another country and that person does a chargeback. You have zero protection. Okay. So you should be using cryptocurrency for that.

But now, some companies are in their infancy, right? So if you do, the limit used to be 2 million, then it went down to a million a month. Now it’s half a million a month. So if you’re doing half a million a month and you want to go global, you want to go global for credit card processing. We have a solution for that, with our worldwide digital payments where you can process in countries all over the world and all different kinds of currency, but everything’s, you know, dollar for dollar. So somebody pays in some weird Japanese yen things, right? They have the yen in Japan, the yeah, yeah. Where they’re paying a Jiro, and you want 50 bucks, it makes sure that you get your 50 bucks. So, and then all, a lot of them they’re not paying in rubles. No, not now. I mean, I saw these at MasterCard announced today that they cut off like any credit card processing. Like you want to charge credit cards through some Russian company. So that’s not happening. They’re going to deny the transactions. The bins are cut off, us everywhere. So global credit card processing is coming. That’s the next wave? You know, that’s the next wave, digital payments.com. Check out our new website or why digital payments check out B2B vault or everywhere. We’re on all the DSP networks. Newly on Amazon music, Stitcher and Pandora, check us out on social media, follow us. We have a live broadcast of the podcast. Go at, go out on Facebook, Twitter and LinkedIn. So you can catch the podcast everywhere. You can watch the videos on YouTube, check out the website, B2B vault.info. Everybody, have a great day. Carpe diem. Thank you, Justin, for making this more interesting by interviewing me. So I appreciate that. Cause you know, it’s hard to be like, you know, just give a monologue on, you know, very boring. Right? So Justin made this more interesting, and I hope everybody enjoyed the podcast that it was educational and everybody had a great day.

Merchant Statement Analysis | Merchant Services Statement Analysis


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