Payment Processors

Payment Processors in Canada

What is a Payment Processor?

A payment processor has direct relationship with Visa and Mastercard in regards to credit card processing.  In Canada, they are not the same companies that issue the credit cards to Consumer.

How Many Payment Processors are there in Canada and Who Are They?

There are six credit card payment processing companies in Canada.  They are: Elavon, 1st Data, Moneris, TD Merchant Services, Chase Paymentec and Global Payments.

Are they affiliated with my bank?

If your business account is with one of the five largest retail banks in Canada, then ‘yes’, they are affiliated with your bank.  Chances are that when you opened your business account, you were asked if you needed payment processing of  Interac (bank cards/ debit cards) and credit cards (Visa and Mastercard).

The ones that are affiliated to the five largest Retail Banks in Canada are:   TD Merchant Services with TD Canada Trust, Chase Paymentec with Scotia Bank , Global Payments with the Canadian Imperial Bank of Commerce (CIBC), and Moneris with Royal Bank of Canada (RBC) and Bank of Montreal (BMO),

Anyone or any company in Canada that offer Payment Processing for businesses all are connected to, or have to go through these six companies.

What are Point of Sale Companies and How are they Connected to Payment Processors?

These companies that are a level lower on the food chain to the six payment processors are called Point of Sale Companies.  Canadian Point of Sale Companies are affiliated with: Elavon, 1st Data, Chase Paymentec and Global Payments.  Point of Sale Companies are at the Merchant Servicing level.  They are the source point for debit and credit terminals, the programming and servicing of these terminals, and they connect their product offering to the credit card processors, the debit processing and financing of the terminal through other 3rd parties.  There are probably less than a dozen large Point of Sale Companies in Canada and a few dozen tiny Point of Sale Companies.  Only a few are reputable.

Who sells these Payment Processing Services?

The Sales Reps or Agents that are in-house, or work exclusively or not, door to door or over the phone with these Point of Sale Companies or Payment Processors are the ones acquiring new accounts for these companies.  These people are the only contact points between the Business Owners that need payment processing and acceptance of bank & credit cards for their business and these large companies.

What other industries have this distribution structure?

Almost every industry looks like this.  A handful of suppliers, then multiple levels of distribution companies and collectively distribute to the largest base possible.  A simple way to visualize all of this is to think of Visa and Mastercard as a manufacturer, then the six Payment Processors in Canada as wholesalers and Point of Sale companies as retailers and all the Sales Agents/ Reps at the wholesaler or retailer as employees.

Example 1

For example there are over 17 000 travel agents in Canada, hundreds of travel agencies and just over half a dozen suppliers to everyone in that industry.

Example 2

Another example is the office products industry in Canada.  There is one super large supplier.  A handful of smaller suppliers and thousands and thousands of companies like a Staples or a Joe’s Office Products (just pretend here).  Each supplier has Sales Reps and each of the thousands of retail companies have Sales Reps that deal with the end user Customers.

Why are there so many names for the same thing?  Payment Processing, Merchant Accounts, Merchant Services, Merchant Processing, Credit Card Acceptance, etc.

We don’t know.  Every company in any industry is always trying to distinguish themselves from the mass of their competition.  Maybe that’s why differences evolve in the way companies are named and do business.

How does fit into all of this? now acquires new accounts for a Point of Sale company called National Transaction Services (NTS).  NTS uses Elavon as their suppliers of credit card processing.

We have acquired new accounts for 6 other Canadian Point of Sale companies that are affiliated with some of the other processors in the past and have chose these two suppliers the last year exclusively, because they have the best pricing and service.