The Power of Residual Income in the Payments Industry: Maximizing Your Earning Potential 

As a business owner, it’s essential to have a reliable source of immediate income and a long-term plan for generating new residual income. In the payments industry, residual income refers to the ongoing revenue that a business can earn from previous transactions. This type of income can have a positive impact on both your business and your personal life. Working with an integrated payments partner like BOLD can be a game-changer in terms of generating this lucrative form of income.

Before we dive into how BOLD can help you tap into the power of residual income, let’s first discuss the benefits of this type of income. 

Advantages of residual income

One of the most significant advantages of residual income is that it provides a consistent revenue stream for your business. Unlike traditional income, which is earned as a one-time transaction, residual income is attained on a recurring basis. This means that even after the initial sale, your business will continue to earn revenue from that transaction. This consistency can provide a more stable financial situation for your business and offer peace of mind knowing that you have a dependable source of income.

Not only does residual income provide stability, but it can also help your business grow. As your business earns residual income, you can reinvest that money into the business to help it expand. You can use it to hire additional staff, expand your product offerings or invest in new technology. With a steady stream of residual income, you can take your business to the next level and achieve your long-term goals.

But it’s not just your business that benefits from residual income. As a business owner, residual income can also positively impact your personal life. With a consistent income stream, you may be able to take more risks and pursue new opportunities. You may also be able to save more for retirement or invest in other ventures. Flexible working hours are another advantage of working in the payments industry. As an Independent Software Vendor (ISV) or Value Added Reseller (VAR), you have the freedom to set your own schedule and work at your own pace. This allows you to balance your work and personal life and take advantage of opportunities when they arise. Whether you are a stay-at-home parent, student, or just looking for more flexibility, this is an ideal opportunity to build a successful and lucrative career.

The uncapped revenue potential is one of the most attractive benefits of working in the payments industry. As an ISV or VAR, you have the potential to earn unlimited income through your partnership with payment processing companies. Your earning potential is not limited by a salary cap or predetermined earnings, allowing you to earn as much as you put in. The more deals you make, the more you can earn, making this an ideal opportunity for entrepreneurs and sales-driven individuals.

How residual income can be earned

In the payments industry, residual income can be earned through every merchant that you onboard. As long as the merchant is processing, you have the opportunity to generate revenue. 

This income is typically generated through a percentage of the total transaction value, commonly called the profit margin. The merchant’s bank pays the processor interchange fees. Residual income is generated through additional fees over interchange and other costs associated with accepting credit cards. For example, batch fees, service fees, and equipment fees.

In this revenue model, the payments processor has the opportunity to earn revenue for as long as the merchant continues to process transactions, making residual income a highly attractive prospect for many payment processors. Additionally, the more merchants a payments processor onboard, the more residual income they can earn. This is why many payment processors focus on building a large merchant base to maximize their residual income potential.

Strategies to maintain a healthy book of business

To earn residual income for your business, you need to identify the products or services most likely to generate recurring revenue. Then, you’ll need to create a strategy to market those products or services to your merchants. For example, use tools like statement analysis AI to ensure portfolio health and maximize residual growth. With BOLD’s statement analysis tool, our partners can effortlessly receive and categorize merchant statements, eliminating the need for costly industry expert advice and maximizing residual growth.

Remember to be transparent with your merchants about any recurring charges so they understand what they’re paying for and when. Maintaining residual income for the long haul requires keeping customers satisfied. When considering a partner for payment processing, keep in mind who you want to work with. Many processors have sales quotas for their representatives; if not met, you lose stable monthly income in the form of residuals. All the time and effort you put in may be for nothing! Make sure to always work with a trusted partner who gives you full ownership of your book of business. 

In conclusion, residual income is a powerful tool in the payments industry that can bring stability, growth, and unlimited earning potential to businesses and individuals alike. By identifying products or services that generate recurring revenue, creating marketing strategies, and using tools like BOLD’s statement analysis, you can maximize your residual income potential and take your business to the next level. With a trusted partner and a focus on customer satisfaction, you can ensure that your residual income continues to grow for years to come. So, start exploring the possibilities today and harness the power of residual income in the payments industry.

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Going cashless in a post-covid era

The COVID-19 pandemic has accelerated the shift toward a cashless society. With concerns about the spread of the virus through physical currency, more and more consumers have turned to digital and contactless payment methods. In this blog post, we will explore the benefits and challenges of going cashless in a post-covid era and its effects on the payments industry.

Benefits of going cashless:

• Increased hygiene: One of the most obvious benefits of going cashless is the reduced risk of transmitting germs and viruses through physical currency. Digital payment methods, such as contactless cards and mobile payments, eliminate the need to handle cash and coins, reducing the risk of infection.
• Convenience: Digital payments are faster, easier, and more convenient than cash. With the tap of a card or the click of a button, you can make a payment without fumbling for change or worrying about running out of cash.
• Increased security: Digital payments offer increased protection compared to cash. Transactions can be tracked, and fraud can be more easily detected and prevented. Additionally, digital payments can be more easily refunded or disputed if there is a problem.
• Better record keeping: With digital payments, transactions are recorded electronically, making it easier to keep track of spending and budgeting.

Challenges of going cashless:

• Digital divide: While digital payments are convenient for those who have access to them, many people, particularly older adults, low-income individuals, and rural residents, may not have access to the necessary technology or financial services. This creates a digital divide that could further marginalize certain groups.
• Privacy concerns: Digital payments can raise privacy concerns. For example, the use of mobile payments can be tracked and used to create detailed profiles of customers’ behavior and spending habits. This data can be used for targeted advertising or sold to third parties.
• Dependence on technology: Digital payments rely on technology, which can be vulnerable to outages and hacking. This dependence can lead to problems such as system failures, which can cause inconvenience and loss of funds.
• Limited acceptance: While digital payments are becoming more common, not all merchants accept them yet, which can be a problem for people who want to use them.

Effects on the payments industry:

The shift toward cashless payments has significantly impacted the payments industry. Here are a few ways in which it has affected the industry:

• Increased demand for digital payment solutions: The shift towards cashless payments has led to an increase in demand for digital payment solutions, such as contactless cards, mobile payments, and e-wallets. The Global State of Digital Payments and Fintech report published last month found 78% of consumers have used digital payment services over the past 90 days. This has resulted in an increase in the number of companies offering digital payment solutions and the number of merchants accepting digital payments.
• Growth of fintech companies: The shift towards cashless payments has also led to the development of fintech companies, which provide innovative digital payment solutions. These companies have disrupted the traditional payments industry by providing more convenient and cost-effective payment options. 
• Increased competition: As more companies enter the digital payments market, competition has increased, leading to a decrease in prices and an increase in the number of features and benefits offered by digital payment solutions.

In conclusion, going cashless in a post-covid era has many benefits, including increased hygiene and convenience. However, it also has challenges, such as the digital divide, privacy concerns, and dependence on technology. As digital payments become more prevalent, it is essential to consider the potential consequences and work to ensure that everyone has access to the benefits of digital payments.

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The PCI Data Security Standard (PCI-DSS) is a global standard that provides a baseline of technical and operational requirements designed to protect account data and information.

Recently, the PCI Security Standards Council (PCI-SSC) announced changes coming to the Data Security Standard. It includes vital information every ISV, VAR, and business accepting credit cards should be aware of in order to remain compliant and avoid compliance fees.  

The beginning stages of v4.0 started in 2017 with changes to v3.2.1. These changes were adopted in the latest version of PCI-DSS and initiated in Q1 of 2020 during the global pandemic. The switch from v3.2.1 to v4.0 happened in a time of uncertainty. With the completion of v4.0, supporting documents (linked below), programs, and updates to training material were completed and rolled out in Q4 of last year (2021). 

The development of PCI-DSS v4.0 was driven by industry feedback and furthers the protection of payment data with new controls and flexibility for the merchant. As the payment card industry evolves, so does the technology and attacks against it. Version 4.0 allows the PCI-SSC to adopt a system of being ahead of the curve and create avenues to help businesses upgrade from v3.2.1. 

The 4 Main Changes for PCI-DSS v4.0

1. Increased requirements for Yearly Diligence for Merchants and Service Providers

• • • Every 12 months and upon a significant change, businesses must document and confirm the PCI DSS.
    • For any merchant that uses the customized approach (info found here), a target risk analysis must be performed and approved by senior management
    • An annual review of hardware and software must be completed with a plan to remediate outdated technologies

2. New Customized Approach (info found here)

• • • This customized approach still retains the requirement to evaluate risk, but it allows for a more strategic pathway for businesses with robust security processes and strong risk management practices 

3. Expanded Risk Analysis Guidance

• • • PCI DSS 4.0 has also provided expanded guidance on conducting risk analysis. Risk analysis has always been a part of PCI DSS, significantly used as part of the compensating control worksheet. In this new version, there is a Sample Targeted Risk Analysis Template (PCI DSS Appendix E2). The template provides more information on how the PCI-SSC expects a risk analysis to be carried out. 

4. Clarifications to “Significant Change” Standard 

• • • PCI DSS v4.0 has also provided clarity for some of the key concepts of PCI-DSS, especially what signifies a “significant change”. While the description is more complex in v4.0 than it has been in the past, older versions were not specifically defined. V4.0 offers clarity and examples of the term “significant changes” and processes to stay compliant during changes. 

Projected PCI v4.0 Implementation Timeline

PCI DSS v3.2.1 will remain active for two years after v4.0 is published. However, it is never too early for ISVs, VARs, and merchants to become familiar with the latest version and build a plan for implementing changes as needed.

PCI DSS v4.0 provides clarity on common issues related to PCI DSS and offers significant levels of flexibility for the merchant who has their own security standards in place. As changes are announced, BOLD will continue to update this article with the latest information provided by the PCI-SSC.

Sources:
https://blog.pcisecuritystandards.org/countdown-to-pci-dss-v4.0
https://listings.pcisecuritystandards.org/documents/PCI-DSS-Summary-of-Changes-v3_2_1-to-v4_0.pdf
https://www.mwe.com/insights/pci-dss-4-0-introduces-transformational-change/

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