What is the MasterCard Payment Facilitator Model?

The MasterCard Payment Facilitator Model is very similar to the Visa IPSP Model.  It was announced by MasterCard in 2010.  It allows a service provider to aggregate sub-merchants under a single account and settle funds directly to that merchant. Payment Facilitators are required to register their sub-merchants directly with MasterCard.  Once a sub-merchant exceeds $1,000,000 in annual MasterCard sales, they are required to enter a tri-party agreement with the Payment Facilitator and the Acquiring Bank.

Why is Segpay now required to move to the Payment Facilitator Model?

Although the PF model was rolled out in 2010, it was loosely enforced by MasterCard and acquirers.  MasterCard over the last year has registered a number of Payment Facilitators and are now requiring compliance with this model for any service provider that is processing on behalf of sub-merchants.

Why is Segpay announcing this model prior to the other IPSPs?

Segpay has been working with our Acquirers and MasterCard for the last two months to ensure we were in compliance. We felt it was better to be up front and inform our clients of the regulatory requirements as soon as we were made aware of them.

Will all IPSP’s be required to comply?

MasterCard has informed Segpay that any entity processing transactions for high risk sub-merchants will be required to register their sub-merchants with MasterCard. If an entity is found to be processing transactions for un-registered high risk sub-merchants after that date, they will be subject to fines and penalties.

Will I be required to be registered with MasterCard through each of my IPSP’s?

Yes, you will be required to register and pay the fee for each processing entity you are a sub merchant of.

Will registration with MasterCard delay my processing?

No, once you are approved by Segpay and our acquiring bank, you can immediately begin to process MasterCard transactions.  Registration will occur in the next month.

Will there be any changes to my Visa/ACH/Direct Debit Segpay services?

No, it is business as usual for your Visa, ACH, Direct debit processing.

Why should I register with Segpay?

You can be assured that you are in full compliance with MasterCard regulations and will continue to receive Master Card processing services from Segpay.  MasterCard represents approximately 35% of all consumer transactions. You will also be fully compliant well before the deadline and can be assured of no fines or penalties for a late registration.

What does the MasterCard Registration Program (MRP) mean to me?

This registration process is very similar to the Visa registration process that was established in 2002.  The process doesn’t require any additional work on your part unless you exceed $1,000,000 in annual MasterCard sales, in which case you will need another contract.  Like Visa, you simply have to pay your annual fee and the registration details are handled for you by Segpay. 

Does Payment Facilitator Model apply to EU and US merchants?

Yes, it is a global model and Segpay will be required to be registered as a Payment Facilitator with our EU and US acquirers.

Is there a cost of registration?

After September 15, 2012, any new Segpay client registered with MasterCard will be required to pay an initial registration fee of $500.  There will be an annual renewal fee of $500 for all clients starting in July 2013. This is a direct cost paid to MasterCard and there is no mark-up by SegPay or our Acquirer.

How can I pay the registration fee?

If you are an existing client, we can deduct from your weekly payout or you can pay be credit card.

What if I cannot afford the entire payment?

We can spread your initial registration over two or three months if that helps

What if I don’t pay the MasterCard registration fee?

We will no longer be able to process your MasterCard sign-ups and rebills.

Can I elect to just process Visa?

Sure, but you potentially will miss out on 30 to 35% of consumers that wish to join your website.

Can I see the specific MasterCard regulations for the Payment Facilitator Model?

Section 5.4 Use of a Payment Facilitator of MasterCard Rules: www.mastercard.com/us/merchant/pdf/BM-Entire_Manual_public.pdf

Can I see the specific MasterCard regulations for the MasterCard Registration Program (MRP)?

Section 9 MasterCard Registration Program of MasterCard Security Rules and Procedures: http://www.mastercard.com/us/merchant/pdf/SPME-Entire_Manual_public.pdf