New Processing Cost Reduction Tool

Hal Gudmundsen

July 28, 2008

New Processing Cost Reduction Tool Helps Small Merchants Maximize Sale Profits

Merchant Warehouse® adds to the functionality of its MerchantWARE solution to provide big-box retail benefits to the small merchant community

BOSTON, MA - July 14, 2008 - Merchant Warehouse unveils a new tool to help small and mid-sized merchants maximize the value of every sale by reducing their overall payment processing costs. The solution, BINsmart Interchange ManagerTM, is the latest addition to Merchant Warehouse's industry-leading MerchantWARE® Integrated Payment Processing Solution.

The product helps merchants process transactions at the lowest possible cost by automatically identifying the card type being used in the transaction, and prompting debit card users to enter their PIN. This sophisticated, yet simple solution evades Interchange rates and fees (a set percentage charged to merchants and paid to issuing banks for each credit card transaction processed, plus a flat per-transaction fee) by opting for PIN-debit transactions over credit whenever possible. Interchange fees make up the majority of a merchant's processing expenses, but since PIN-debit transactions are not processed on the Interchange networks, PIN-debit transactions are less expensive (typically only a flat transaction fee is charged). The BINsmart Interchange Manager also detects corporate card transactions, making it simpler for merchants who need to submit tax amounts and customer codes to receive the best rates.

Below is an example of a merchant's potential savings with the BINsmart Interchange Manager:

  • The cost to process a $200 sale using a bank-issued card as "credit" under standard Interchange rates and fees would be approximately $4.00. However, if that customer used the same bank-issued card, but was prompted to enter their PIN, the cost for that sale to the merchant would amount to approximately $0.50; a savings of $3.50 on just one transaction!

Historically, only the largest retail establishments have had the technology to implement this solution, but with Merchant Warehouse's BINsmart Interchange Manager, any merchant can take advantage of these cost savings. Because the process is automated, employees no longer have to ask "debit or credit?" and more transactions will qualify at the lower costs.

"Merchants of all sizes are looking for ways to save money and maximize profits in the face of a slow economy. With BINsmart Interchange Manager, we are now able to help smaller retail merchants to better compete with the regional or national stores by helping them save money almost every time a customer uses their debit card for a purchase," said Henry Helgeson, President and Co-CEO of Merchant Warehouse. "This tool puts the ability to maximize the dollar value of every transaction in a way that is convenient and affordable back in the hands of the small merchant."

The Merchant Warehouse BINsmart Interchange Manager is compatible with all current PIN-pads and uses all current debit peripherals, so no changes are needed to existing devices. The solution is available now by calling Merchant Warehouse at 1-800-968-0953 or emailing

More information on MerchantWARE® and BINsmart Interchange ManagerTM is available at or by visiting Merchant Warehouse at booth #101 at the RetailNOW Expo, held on July 15-16th at the Rio All-Suite Hotel & Casino in Las Vegas.