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What is a Merchant Service ISO Program?

If you are wondering what a Merchant Service ISO program is then we will need to start by defining what ISO stands for. ISO is short for independent sales organization. What this means is that if a company is not ISP approved then they will not be able to offer Visa credit card process services under their unique company name. In order to be able to display the ability to process Visa credit card payments the business must be on the Visa ISO list.

If the company is not on this list then they must offer the merchant accounts for sale under the Visa approved ISO name. Even if the company has their own company name they cannot use it for merchant transactions unless it has been approved and added to the ISO list. If you have a VISA provided ISO account then you are representing a processor, bank or both.

One of the many benefits of obtaining a merchant service ISO program is that you have the ability and authority to set your own terms and agreements when it comes to fees and processing rates as well as the agreements between you and the client. While it is possible to be a processor and an ISO agent at the same time; many ISO’s simply act as the middle man between the sales market and the processors which they are in need of to complete their transaction.

When you apply for any type of merchant account, there are two different groups which are utilized in order to make a determination on whether you will be given the type of merchant account for which you are applying. The two groups are an independent service organization which is also commonly known as an ISO as well as an underwriter; however, in many cases the ISO is also the underwriter as well.

The future success of the company is taken into consideration through careful review of many factors such as the personal and business credit score as well as the type of business that is applying and the products or services in which they offer for sale. Even if an ISO account is issued, it can be revoked if the merchant violates the given terms of the contract in which binds the ISO account. If this is to occur, the ISO account can then be shut down.

A similar process is followed by MasterCard and is called a MSP which stands for MasterCard Service Provider. If a company wants to offer the processing of MasterCard credit cards under their business name they will need to go through a similar process as when applying for an ISO account. There is a similar list that is kept by MasterCard which provides merchants with a list of MSP are which are authorized to provide MasterCard processing services.

Just as with an ISO an MSP dealer is allowed to use their own business name as well as set the rates and terms of the transactions as they see fit. This allows them to mark up the fees for processing in order to make a profit off of the transactions for which they process.