Insights

ISO stands for Independent Sales Organization and it is a term used by Visa. MSP stands for Merchant Service Provider and it is a term used by MasterCard. ISO and MSP mean exactly the same thing – a company sponsored by a member bank to resell credit/debit card processing services. Becoming an ISO/MSP requires a business to go through a registration process and pay a fee (usually $10,000). One can easily verify an ISO/MSP by checking a company’s website or any of their marketing material for a disclosure “company is a registered ISO/MSP of bank, town, state. FDIC insured”. This disclosure is required by both Visa and MasterCard and will cause a fine of up to $25,000 if it is not clearly visible.

As we noted in a previous article, ISOs can take on varying degrees of involvement in their merchant services portfolios. Some ISOs perform sales, underwriting, customer service, terminal deployment and support, and manage a degree of liability if the merchant goes out of business. Some ISOs also provide valuable services that may not be found at a large payment processor – such as support in foreign languages and support of a niche Point-of-Sale system or software. Some ISOs, however, are simply merchant facing sales offices with all the back-end functions being handled by the sponsoring processor. The strength for most ISOs is selling and servicing small to mid-sized businesses since they have the greatest number of “feet on the street.”

When dealing with any ISO or large merchant acquirer for that matter, it is always important to understand the “value” they provide. How does the pricing, services and support they provide compare with the next company selling card processing services.

Our research identified the following 1,300+ registered ISOs with Visa and MasterCard. For your reference, they are sorted alphabetically and their registered State is listed in the right column.