Quote:
Originally posted by RonC
This is how the scenario will play out. Glo-bill is most likely going to try to say they are just the merchant, and they just pay a referral fee to webmasters for sending transactions.
lets say for simple math that 100 customers leave CCbill, Ibill and Epoch to go over to Glo-bill thinking the grass is greener on that side. They will pay the $750 to the current processor since
the recurring transactions are worth more than $750 per year and do not want to loose that income. CCbill, Ibill, or Paycom report that customers name and urls as a U.S. webmaster and are able to process it with no problem.
The end of the first month comes and Glo-bills new bank (lets say in Germany) gets a notice from Visa. The notice will say that they are currently in violation of section XXX. of their Visa operating agreement and
are introducing non coded High Risk IPSP transaction into the Visa system. You currently have 100 Sponsored merchants that are in violation of the cross boarder rules. The fine for this is $25,000 per Webmaster
or $2.5 million fine. (Guess webmaster are not getting checks this week) The bank will say wait a minute, we are not going to pay this, they will due what all banks do, they will pass this down to the merchant (Glo-bill). Visa will also let the bank know that they are in violation of their Master Merchant agreement with Visa and if the continue to send transaction into the Visa network they could loose their right to process Visa at that bank and or more possible future fines.. The risk people at the are going to say wait we have a merchant that could cause us to Loose our ability to process Visa, and we probably do not have reserves great enough at this point to cover future fines? What do we
do? The bank notifies Glo-bill they can only send transaction from webmasters in Germany or they will close their account.
Remember this is their bat, their ball, and their field, and their rules.
Now of course Glo-bill is going to try and appeal these fines, This is where the part about their umpire comes in. The answer from Visa is going to be to bad you broke the rules. Glo-bill will then be left with going to court, now in a forgein country, trying to convince a Judge that they should over rule Visas rules for a porn company that is trying to bypass their rules. Sure this will happen
For the people that claim this is only spin. Do you really think that all three of the largest billing companies did not have a larger army of lawyers work with Visa to find a way around these rules and only Glo-bill was able to find the path.
At the end of the day, it may have been just as simple as Visa will pick up the phone, call this new bank that Glo-bill just started a relationship with and say "We would like for you to discontinue doing this" End of conversation, since banks treat a call from Visa like the IRS. YES, Sir, Thank You Sir, We will do that Now Sir.
The reality is lots of new little companies will pop up, making all kinds of claims, Visa will handle them just like they do Bestiality, Lolita, etc.. They will close one down, and another will pop up. The webmaster that is promoting some content that is not except like Bestiality may not care that they lost their rebills, and call that a cost of business. The legit webmaster on the other hand may get thrown out with the rest and loose 60% of their money from their rebills
Ron C
CEO, CCBILL.com [/B]
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Ron,
I may not know you personally, but I have seen CCBill come a long way since you started.
But I will say that it would rather be you who may have overlooked a few things.
Firstly, CCBill and the top 3 leading are NOT the TOP 3rd Party Processors. You forget your domain also overlaps Digital River, though Digital River and all the rest of the shareware industry player also face the same problems. So maybe you might want to stop thinking that CCBill is HUGE, yes it is huge but NOT the top. ;)
I also wish to refute the above scenario. Visa and MC are consortiums of banks that subscribe to the VISA and MC network. There is a Visa Germany, there is also a Visa Australia, Visa USA and Visa England. To state that all the VISA accepted the PROPOSAL is out there.....there WILL AND ALWAYS WILL BE countries that fall outside this domain.
Perfect example, the CVC2 and the CVV. Why is it countries like Visa China for example or Visa Taiwan still NOT issue cards with CVV or CVC?
The reason is SIMPLE, because NOT all the Banks that make up that country subscribe to that NOTION and there NEVER WILL. I know because I used to run a third party company which later was sold to another company, so this debate is really interesting for me.
You know for a fact and lets put it this way, Visa and MC have their weakness when it comes to e-commerce, hence the number of chargebacks. Visa International could easily put THIRD PARTY CREDIT CARD DETECTION SYSTEMS OUT OF WORK, by insisting that all CARDS MUST HAVE CCV and CVV issued. Yes or no? We both know the answer is YES!
So the same thing goes, and I am NOT trying to pour cold water over your company and your VIEWS, BUT IT IS POSSIBLE given the above example I just quoted that VISA INTERNATIONAL cannot control all the banks.
There are over 2,500 BANKS that have SEATS on VISA. You think VISA INTERNATIONAL will back VISA USA? Geez, VISA USA is ONLY PART OF VISA INTERNATIONAL and it has ONE VOTE vs the rest of the WORLD.
And yes, I feel your pain as a previous owner of a third party credit card company, but lets put it this way, if I were to start off as an international person selling shareware or porn, I NOW NO LONGER see a reason to use a third party to deal with it. Why should I? I can easily hire a US front to front the COMPANY and pay cheaper merchant rates. That is just my two cents worth. Let me know if you disagree with this post. I love to talk to you about this.
-Nato