11 Staff Report - Debit/Credit Card AcceptanceNVAN op MEETING DATE: 6/16/2008
ITEtii NO:
!pS GA OS COUNCIL/AGENCY AGENDA REPORT
DATE: 5/29/2008
TO: MAYOR AND TOWN COUNCIL/
CHAIR AND MEMBERS OF THE REDEVELOPMENT AGENCY
FROM: GREG LARSON, TOWN MANAGER/EXECUTIVE DIRECTOR
SUBJECT: DEBIT/CREDIT CARD ACCEPTANCE
A. Approve new Town Cash and Credit Card Policy.
B. Authorize Town Manager to execute a merchant service agreement
with Wells Fargo Bank through a Master Service Agreement (MSA)
with the State of California.
RECOMMENDATION:
1. Approve Cash and Credit Card Policy.
2. Authorize Town Manager to execute a merchant services agreement with Wells
Fargo Bank through a Master Service Agreement (MSA) with the State of
California.
BACKGROUND:
Currently, because of the Town's legacy software limitations, the Town of Los Gatos
does not accept credit or debit cards for payments. With the implementation of an
upgrade to the Town's financial and human resources software, the Torn now has the
ability to accept credit cards over the counter and online.
Effective January 1, 2007. State law enables public agency governing bodies to approve
acceptance of debit and credit cards as legal tender for payment of agency services and
products. Any additional "convenience" fee imposed for the use of debit and credit cards
must also be approved by each governing body.
The Town does not currently have a cash and credit card policy. The new Cash and
Credit Card Policy will provide direction for all Town staff who receives both cash and
credit card payments from Tow customers.
PREPARED BY: Steplie na`n'c~e and Administrative Services Director
Reviewed by: -SAssistant Town Manager/Deputy Director 41~% Town
Attorney/General Counsel Clerk Administrator. Secretary Finance
Community Development
PAGE 2
MAYOR AND TOWN COUNCIL CHAIR AND MEMBERS OF THE
REDEVELOPMENT AGENCY
SUBJECT: CREDIT DEBIT CARD ACCEPTANCE
May 29, 2004
TITCC'i "CCI(l
Beyond software considerations, to facilitate the acceptance of credit cards, the Town
needs to select a banking partner, referred to in the industry as a "merchant service
provider," to access the credit card or "merchant banking" processing system.
Several vendors were considered under the California State Master Service Agreement
(MSA) and Wells Fargo was most responsive to the Town requirements. The selection
process considered the cost charged by the provider (discount rate). technical
compatibility with the Town's financial and other software systems and general customer
service.
Use of debit and credit cards includes a fee charged to the Town from industrv
establishments such as VISA and MasterCard. The fee is based upon a percentage of the
amount of payment made by credit card plus a flat amount per transaction. Through the
VISA between the State of California and Wells Fargo Bank. the Town's discount rate
will average 1.96%. plus 50.10 per transaction. Rates from other vendors ranged
between 2 - 6% plus up to 50.30 per transaction. The scope of services to be provided by
Wells Fargo is provided in Attachment 2. This will serve as the basis for the merchant
services agreement.
The proposed Cash and Credit Card Policy allows the Town to accept credit and debit
cards at all locations where payments are received by the Town and online. At the
introductory phase.. the Town will accept credit cards only. Acceptance of debit cards
«ill be introduced later once a new version of the Toxvn's financial software is released.
Phvsical locations, where credit cards will be accepted include the Finance Department.
Clerk Department. Police Department, Parks and Public Works Department, Communlt%
Services Department and Library. Staff proposes to limit payinents by credit card up to
S9.999.99 per single transaction. This limitation will lower the cost to the Town for
providing this service to residents and customers.
Credit card acceptance over the counter and online will provide flexibility and
convenience for residents. Online options will include twenty-four (24) hour access to
view and pay for existing business license accounts, some permits, and park reservation
facility fees.
PAGE 3
MAYOR AND TOWN COUN"CIL/CHAIR AND MEMBERS OF THE
REDEVELOPMENT AGENCY
SUBJECT: CREDIT`DEBIT CARD ACCEPTANCE
May 29, 2008
A suiwey of cities in the Santa Clara County indicates that for those cities accepting debit
and credit cards, none is charging a convenience fee to recover revenue lost due to
discount fees paid to the merchant service providers. A majority stated that they will
consider levying a convenience fee in the future. At this time. staff is not recommending
a convenience charge for using credit cards, however the proposed Cash & Credit Card
allows the Town to charge a convenience fee in the fiiture.
If approved by the Town Council, it is anticipated that acceptance of credit cards over the
counter and online will be available to the public by summer of 2008 except for the
Library online payments. Online payments for the Library be available when the current
library proprietary software is upgraded to allow for such a service or feature.
ENVIRONMENTAL ASSESSMENT
It is not a project defined under CEQA, and no further action required.
FISCAL IMPACT:
The cost of offering this service is broken into two categories: set up and ongoing. Setup
costs include equipment, installation/programming and training. Setup costs were
estimated and included in the initial project cost approved by Council in 2006.
Ongoing costs include monthly/annual fee, chargeback fee and discount fee. The discount
fee is estimated at 1.96% plus 50.10 per transaction. For FY 2008109, ongoing costs will
approximately be 50,000. It should be noted that this is an estimate based on a 20%
participation level. Staff will bring a budget adjustment for council approval at mid-year
to cover this cost at which point there would be six months substantiated data available to
estimate the annual cost.
CONCLUSION:
Approval will allow staff to establish this service to residents and customers of the Town
of Los Gatos.
Attachments:
1. Cash and Credit Card Policy
2. Proposal for Merchant Processing services - Wells Fargo Wholesale Treasury
Solutions
Town of Los Gatos
CASH AND CREDIT CARD POLICY
1. PURPOSE
This policy sets forth procedures that govern the handling, deposit and safekeeping of Town cash.
Furthermore, this policy is intended to supplement other Town personnel policies that govern rules of
conduct and performance in the workplace.
2. POLICY
2.1 Applicability
The Finance Department is responsible for providing an accurate accounting of all Town cash,
including revenues and expenses. Professional financial and accounting practices dictate that all
funds received by the Town be promptly deposited in a Town bank or investment account. This
insures that Town cash is accounted for and available for investment or an authorized expenditure.
The term "Town cash" applies to currency, coin, checks, money orders, credit, charge and debit card
payments, other electronic payment media and other negotiable instruments payable in money to the
Town and/or Redevelopment Agency.
The Town's central cashiering function is performed by the Finance Department; however, other
departments will receive payment for Town services and products. As such, employees that have
been authorized to receive Town cash share the stewardship of financial assets for the Town. Other
payments will be received online through the Town's website.
2.2 Authority of the Finance Director (or designee)
The Town of Los Gatos Municipal Code, Chapter 2, Article V, outlines the responsibilities of the
Town's Finance Director. Duties of the finance director (or designee) include coordinating, reviewing,
evaluating, and recommending improvements to administrative and financial internal control systems
and procedures to insure audit compliance; directing and participating in the preparation of a variety
of records and reports ensuring timeliness, accuracy, and compliance with appropriate laws,
ordinances, and regulations. With respect to cash handling, this includes the following:
* Receipt, handling and deposit by Town officers and employees of Town
cash into the Town treasury;
• Method of documentation on all such transactions;
• Inspection of departmental cash records, including overages or shortages;
• Inspection of departmental practices and procedures in handling Town cash;
• Contracting with agents to collect Town cash and their collection procedures.
The Finance Director (or designee) may enforce these rules through on-site inspections; inspection of
transaction records, or any other means deemed appropriate to protect Town assets. In the event of
noncompliance by a department or office, require that payments to the Town be receipted at his/her
office.
2.3 General Cash Controls
2.3.1 The number of employees with access to cash funds shall be limited to assure internal
control. Each department director shall grant access authority by completing the relevant
cash handling authorization form.
2.3.2 To the extent staffing levels permit, separation of duties from the function of custodian of
cash balances and the accounting and record keeping of the same shall be maintained.
2.3.3 Where staffing levels do not permit separation of duties, compensating controls such as strict
individual accountability and thorough management review and supervision shall exist.
Authorized personnel not assigned the custodial responsibility shall periodically examine,
count or perform other
reviews of cash funds.
2.3.4 Physical protection of funds through the use of bank facilities and locked
cash boxes or drawers shall be practiced at all times.
2.3.5 Town cash on the premises will be held to an absolute minimum to insure
safety and maximize return on investments.
2.4 Cash Receipting
2.4.1 The Finance Department performs the central cashiering function therefore
all evidence of deposits, i.e. deposit slips and department revenue summaries, shall be
forwarded to the finance department as soon as possible to assure timely and proper credit in
the receipting process.
2.4.2 All departments receiving Town cash shall have a permanent collection record, such as a
cash register tape, that has the record of transactions including voids, refunds, or
cancellations. All revenues collected over the counter shall have a receipt issued at the point
of sale or collection whether handwritten or electronically generated
2.4.3 All handwritten receipts shall be pre-numbered and issued from receipt books issued by the
finance department to account for any lapsed sequence.
2.4.4 All currency in the amount of twenty (20) dollars and above shall be checked with a
counterfeit money detector or pen prior to acceptance to verify the bills are not counterfeit.
2.4.5 Departments receiving checks as payments shall require the maker of the check to make it
payable to "Town of Los Gatos". Under no circumstances shall a check for the Town be made
payable to an individual or left blank.
2.4.6 All checks shall be endorsed (stamped with a Town of Los Gatos deposit stamp) immediately
upon receipt.
2.4.7 Each check shall be inspected to ensure the following:
• Current date (post dated checks shall not be accepted);
• Proper signature:
• No alterations;
• Bank name and routing number printed on check:
• If temporary check. payer's name and address written on check;
• Written amount matches numeric amount;
• Not a third party check.
2.4.8 No checks shall be cashed.
2.4.9 All steps of each counter transaction must be completed, including steps to enter the
transaction in the accounting system and to place the receipts in a secured location before a
new transaction is started.
2.5 Merchant/Credit Card Receipts
In keeping with the Town's goal to provide excellent customer service, customers will have the option
and convenience of making payments for programs, products and services using credit cards or
ATM/debit cards, in addition to cash and checks.
The Town will accept VISA and MasterCard credit cards and ATM/debit cards with the VISA or
MasterCard logos. American Express, Discover, Carte Blanche and Diners Club card will NOT be
accepted.
The Town reserves the right to charge a convenience fee for credit card based transactions. No
payment in excess of $9,999.99 will be accepted for payment using a credit card.
2.5.1 Acceptable and Prohibited Credit/Debit Card Transaction
VISA, MasterCard and ATM/debit card payments are accepted for ALL Town programs,
products and services EXCEPT for the following;
• To cover returned checks (acceptable with a PIN based card use)
• Cash advances
• Cash back on a transaction
• Release of towed vehicles (acceptable with PIN based card use)
2.5.2 The following should be observed at all times regarding acceptance of credit and
ATM/debit cards;
2.5.2.1 Each time a customer is using a credit card, a signed picture identification must
be required. Examples of acceptable identification are driver's license, military or
government identification, or California identification card.
2.5.2.2 Signed picture identification is not required for debit card transactions where the
customer uses a personal identification number (PIN) to process transaction.
2.5.2.3 Telephone number, address or driver's license number are not required as a
condition to accept credit/debit card payments, unless necessary if a fraudulent card
is suspected.
2.5.2.4 Telephone number, address or driver's license number should not be written on the
sales draft or note pad.
2.5.2.5 Customer receipt should ONLY display the last four (4) digits of credit/debit card
number.
2.5.2.6 Cashiers should NEVER ask customer for their PIN for debit card transactions.
2.5.2.7 No cash or check refunds will be made on transactions paid for by credit/debit card.
Credits will ONLY be issued to the card used for the original transaction.
2.5.2.8 Participating departments must close-out, balance and submit credit/debit
transactionireceipts on a daily basis.
2.5.2.9 Any improper use of Town credit/debit card equipment constitutes misuse of Town
property and will subject employee to disciplinary action up to and including
termination. Improper use includes, but is not limited to, improper documentation,
falsifying and/or altering sales drafts/receipts, and abuse of equipment.
2.5.2.10 Lost or stolen equipment or supplies must be reported to finance
director (or designee).
2.5.2.11 The Town reserves the right to refuse acceptance of any
credit/debit card for payment.
2.5.2.12 Any fraudulent use of crediUdebit card subjects individuals to
criminal prosecution.
2.6 Overages and Shortages
2.6.1 It is the responsibility of the cash handler to ensure cash on hand equals the change fund
plus actual receipts at all times.
2.6.2 All shortages and overages shall be reported to the department director and finance director
(or designee) immediately.
2.6.3 All cash overages and shortages, as well as any known circumstances surrounding the
overage/shortage, shall be documented in a memorandum to the finance director (or
designee) within one (1) business day as well kept on file by the reporting department.
2.7 Theft or Loss
2.7.1 Once a theft or loss has been identified. it shall be immediately reported to the department
director, finance director (or designee), and the Town of Los Gatos police department. No
investigation or discussion with other staff prior to notification of the proper authority.
2.7.2 All theft or loss shall be documented in a memorandum to the Finance Director (or designee)
within one (1) business day as well as kept on file by the reporting department.
2.8 Deposits
2.8.1 The general operating standard for deposits of Town cash to the bank shall be within twenty-
four (24) hours or the next business day of receipt of those funds. Departments shall weigh
reasonableness and practicality versus security in determining the timing for the deposit of
small amounts. All deposits not made daily shall be held in a secured location such as a safe.
2.8.2 All receipts of Town cash must be deposited with the finance department in accordance with
this policy and the cash handling procedures of the department that have been approved by
the finance director (or designee).
2.8.3 All security and bid deposits or escrow funds received in cash shall be treated as Town cash
and deposited accordingly.
2.8.4 Departmental receipts shall never be used to replenish petty cash, other funds, or for the
purchasing of items.
2.9 Petty Cash
2.9.1 Petty cash funds, not to exceed $200, shall be approved by the department director and
established by the issuance of a check from the Town's accounts payable division restricted
to a level appropriate to conduct Town business in an efficient and responsible manner.
2.9.2 Petty cash transactions shall be subject to the same authorized expenditure controls as any
other invoice presented for payment through accounts payable.
2.9.3 Once established, petty cash funds shall be maintained on an impress basis, that is, the
amount of the fund will remain constant with the custodian of the fund requesting a
reimbursement check from the accounts payable division for amounts disbursed.
2.9.4 Any funds taken from petty cash must have a completed authorized petty cash voucher. A
check will be issued only upon the presentation and surrender of satisfactory evidence of
such disbursements. The amount of the reimbursement will always be the exact amount of
the aggregated disbursements made from the fund.
2.9.5 Reconciliation and reimbursements will be made as frequently as the fund requires
replenishment, but no less than monthly.
2.9.6 When replenishing petty cash, a copy of the petty cash recap must be kept in the petty cash
box as backup for the vouchers that have been sent to the finance department.
2.9.7 No checks shall be cashed from petty cash funds.
2.9.8 Personnel authorized by the finance director (or designee) can make unannounced counts of
petty cash and /or change funds at any time.
2.10 Change Funds
2.10.1 Change funds shall be established and controlled in the same manner as petty cash funds;
however, change funds are strictly used for making change for customers and as such are
revolving funds that require no replenishment.
2.10.2 There shall be no commingling of petty cash or cash receipts with change or other working
funds.
2.10.3 When change funds are no longer needed to conduct the business for which they were
established, the funds shall be deposited with the finance department as soon as possible.
4
2.10.4 Change funds established for any reason shall be used only for the purposes of conducting
legitimate Town business and not for personal use even if reimbursed.
2.10.5 No checks shall be cashed from change funds.
2.11 Check Cashing Policy
2.11.1 No checks shall be cashed.
2.12 Returned Checks
2.12.1 Occasionally a deposited check may not clear the bank for one or several reasons; such as
non-sufficient funds, account closed, stop payment, funds held, stolen checks, forgery,
endorsement, or signature. The Finance Department assumes responsibility for collections
with cooperation from the receipting department.
2.12.2 The finance director (or designee) has the authority to refuse the acceptance of checks as
deemed necessary.
2.13 Refunds
2.13.1 Refunds will only be made to the original entity (person or company) that submitted the
original payment to the Town.
2.13.2 Refunds of payments that were originally paid by credit card will be credited back to the credit
card in which the payment was made from.
2.14 Foreign and Mutilated Currency
2.14.1 Foreign currency and coin shall not be accepted. Only currency and coins issued by the
United States Federal Reserve Board are legal tender. Traveler's checks must state "U.S.
Dollars".
2.14.2 No mutilated currency or coin, including bent coins, shall be accepted.
2.15 Banking Services and Account Opening Policy
2.15.1 The Finance Department is responsible for the Town of Los Gatos' banking relationships.
2.15.2 Opening new or closing bank accounts must be approved by the Town Treasurer.
2.16 Written Procedures
2.16.1 It is required that written procedures be developed and maintained by each department
associated with the Town that handles Town cash. Departmental procedures must be
approved by the finance director (or designee).
2.16.2 Written procedures shall be consistent with this policy and minimally include:
• Authorization of person(s) to collect Town cash;
• Off-site cash collection procedures;
• Maintenance of receipt logs;
• Security and reconciliation of Town cash
• Individual cash drawers for each cash handler
• Cash handlers must only accept and receipt funds using their Individual
cash drawer
• Processing of Town cash received in the mail
• Preparation, approval, and transmittal of Town cash to the Finance
Department;
• Over/short procedures consistent with this policy;
Procedure to notify the appropriate Town authority in the event of loss or
theft;
Town cash must never be left out in the open or unattended.
2.17 Training
2.17.1 All staff shall be familiar with this cash and credit card policy and must acknowledge receipt
of the policy using the relevant form.
2.17.2 All staff that handles Town cash shall be trained on the cash and credit card policy by the
Finance Department and be trained on cash handling procedures by the department.
2.18 Violations
2.18.1 Any employee found to have violated this policy may have his/her cash handling
authorization limited or revoked completely and may be subject to formal disciplinary action
up to and including termination.
2.19 Policy Review
2.19.1 The Finance Department shall perform a review of all Town cash handling policies,
procedures, functions and processes on a regular basis, but at minimum of every two years.
2.19.2 The Town's independent auditors shall review the Town's cash management controls through
the course of their annual audits as needed.
3. Liability for Loss as Between Department and Finance Director (or designee)
As between a department and its officers and the Finance Director (or designee), the department
as primary responsibility for care and liability for loss of Town cash in its custody until deposited
in the Town Treasury or entrusted to a cashier approved by the finance director (or designee);
and the finance director (or designee) thereafter.
Compliance with the Finance Director (or designee)'s rules and procedures, approved by the
Finance Director (or designee), establishes a presumption that a Town department or office
exercised due diligence in its custody and care of Town cash.
6
Wells Fargo Wholesale
Treasury Solutions
Proposal For
Merchant Processing
Presented To:
City of Los Gatos
May 2008
Direct Inquiries to:
Troy Byram
Vice President
Wells Fargo Wholesale Treasury
415-396-6981
Troy.D.Byram@welIsfargo.com
EXECUTIVE SUMMARY
Wells Fargo - A leader in payment processing
One of the benefits of our payment processing solution is the expertise and support you will receive from
Wells Fargo Bank, a trusted financial institution and leader in payment processing services. WFMS
allows our merchants to operate and expand their business while focusing on the most essential part of
their operations and increasing sales.
Today, WFMS is a dominant force in the Merchant electronic-payment services industry, with substantial
national market share in both credit and debit transaction processing. WFMS serves approximately
216,000 merchants, including over 35,000 Internet merchants, with combined annual bankcard volume in
excess of $73 billion.
Since 1976, Wells Fargo has been developing new and more efficient ways for our merchants to process
electronic payments of all kinds. This process began with the design of an in-house authorization and
processing system, establishing Wells Fargo as the first bank to offer electronic authorization for
MasterCard and Visa transactions. In the eaayments arena, Wells Fargo was one of the first financial
services companies to process a secure credit card transaction on the Internet.
With an unparalleled range of products and services, supported by nearly three decades of experience,
WFMS is well prepared to provide the best possible payment processing solutions. Our goal is to
showcase WFMS state-of-the-art products and service abilities we provide today, while demonstrating an
interest in developing unique solutions in a partnership with our clients in the years ahead.
COMPANY OVERVIEW
Wells Fargo & Co
Wells Fargo (NYSE: WFC) is a diversified financial services company providing banking, insurance,
investments, mortgage and consumer finance from 6,250 stores, the Internet (www.wellsfargo.com) and
other distribution channels in all 50 states of the U.S and in other countries. Wells Fargo & Co. has $575
billion in assets and 160,000 team members. Wells Fargo has achieved annual double-digit increases in
revenue and earnings per share and total stockholder return not just this year but also for the past 20, 15,
10 and 5. Total annual stockholder return double the S & P 500. Wells Fargo & Company and
Subsidiaries (consolidated) is ranked fifth in assets and fourth in market value of our common stock
among U.S. bank holding companies at December 31, 2005.
Wells Fargo Merchant Services, LLC
Wells Fargo in collaboration with First Data Merchant Services (FDMS), have joined together to create
Wells Fargo Merchant Services, LLC. (WFMS). WFMS is a leader in the merchant electronic payment
services industry, with substantial national market share in both credit (10th) and online debit (5th) card
processing.
Confidential and Proprietary
Over the past decade, a select list of important initiatives include:
• Pioneered banking by computer
• First bank to offer 24-hour person-to-person telephone service
• First bank to process secure credit cards transactions over the internet
• Piloting Mondex smart card in the U. S.
• First to provide mutual fund trades via ATMs
• Pioneered sales of U. S. postage stamps at ATMs
• First lender to originate small business loans remotely (direct mail)
• Automated supermarket banking centers
• First to offer banking via the Internet
Forbes magazine recently ranked Wells Fargo as the #1 bank in the world, Also, Smart Money magazine
named Wells Fargo its #1 stock pick in the banking segment of the financial services industry.
COMPETITIVE ADVANTAGE
Wells Fargo Merchant Services (WFMS) offers a vast array of services designed to provide
comprehensive processing solutions to our merchants. We have designed an organization and systems that
offer merchants measured cost savings, technological expertise, exceptional service and a unique set of
operational benefits. WFMS offers some unique advantages:
Discount Fees Deducted Monthly: Fees are deducted from your bank account once a month instead of
daily. This helps streamline reconciliation.
Low Unit Transaction Pees: WFMS enjoys large economies of scale and has aggressively structured its
fees to offer measurable cost savings.
Securing the Best-Qualified Rate: WFMS ensures that each transaction is sent through at the lowest
possible Interchange qualification rate available to your industry. Additionally, our pricing structure is a
true pass-through of the rates charged by Visa and MasterCard.
Expedited Funding: Funding of bankcard transactions are expedited through an automated file transfer
directly to the Wells Fargo DDA system. We have established an 11:00 AM PT cut-off time to complete
the daily settlement file. Bankcard funds are memo posted the next morning by 9:00 AM PT to a Wells
Fargo Direct deposit account.
~dsFErs G
Conhdenlial and Proprietary
Superior Management Reporting Tools: These reports can consolidate the credit and debit card activity
for each location, or all locations collectively. www.mvcIlentIinc.net provides the most advanced
reporting in the industry. The system allows you to track your merchant activity on a daily or monthly
basis, and export data to your own programs in an excel format.
Clientline.net is a secure, easy-to-use Internet-based service that provides access to a monthly
outlet or recap statement along with transaction data for in-depth research, and statistics.
Clientline.net offers a comprehensive suite of reporting views and utilities for credit and PIN-
based debit transactions. Credit card specific information includes in-depth research, retrieval and
chargeback history and statistics, non-compliance statistics for managing Interchange
qualifications and a host of other financial data to help merchants manage their data.
Information can be viewed, sorted and printed from the application or exported to an Excel
worksheet. Clientline.net is updated every 24 hours. Your monthly statement can be viewed in a
browser, PDF file or be printed after the second business day the following month. Pre-scheduled
email or fax reports are also possible. Yesterday's activity can be viewed the next business day
for all card types. You can see a guided tour to view some of the standard reports available at
www.mvclientline.net.
Provide Cost Effective Solutions: By consolidating as many services as possible under one processing
platform to take advantage of economies of scale.
Authorization Network: WFMS has robust networks, redundant data centers, multi-carver support,
ISDN backup and end-to-end solutions. Our response time is less than three seconds for 90% of
transactions and we have 98% system availability. WFMS has not incurred any significant outage or
disruptions during the past five years.
DEDICATED CUSTOMER SERVICE
The backbone of our payment processing solution is the quality of our customer support. 94% of
customers who responded in our 2005 customer satisfaction survey said they would recommend WFMS
to others. WFMS provides 2417 support to keep you processing with uninterrupted service. Some
customer service options include:
Relationship Management - We will automatically assign a relationship management team to take care
all your day-to-day merchant card needs. Your relationship management team will also work closely with
your Wells Fargo Commercial Banking office Relationship Manager to provide seamless service to you.
Our relationship managers have been recognized as best in class for service and experience. In addition to
daily operational support, your relationship managers will also perform the following functions:
Information Security Consulting - Cardholder information security is extremely important. Your Wells
Fargo Relationship Manager will work with you to ensure that your equipment meets all requirements for
Payment Card Industry (PCI) Data Security Standards.
Confidential and Proprielary
Association Compliance Reviews and Updates - All merchants must comply with Visa and MasterCard
operating regulations. From time to time the Associations introduce new rules and your Relationship
Manager will ensure that you are kept up to date and work with you as necessary if variances or
extensions are warranted.
Interchange Management - Your Relationship Manager will review your transaction activity with you
on a monthly basis to ensure that your business is achieving the best possible interchange qualification
rate and will provide guidance and suggestions for optimizing transaction processing.
Chargeback Analysis - On an as needed basis, your Relationship Manager will provide you with a
detailed analysis of your chargeback activity, by chargeback reason code and will suggest ways that you
can reduce Chargebacks.
Chargeback Triage Visa and MasterCard require that chargeback to sales ratios are not excessive.
Your Relationship Manager will proactively monitor your merchant account to identify trends that may
indicate a growing problem with Chargebacks and recommend strategies and tactics to reduce
chargebacks. If chargeback volumes exceed Association parameters, your Relationship Manager will
partner with you to develop a Chargeback Reduction Plan and will work with the Associations to
communicate your plans and progress.
Implementation - Through the implementation process will have a dedicated Wholesale Implementation
Management Team leading the enterprise-wide conversion, beginning with a Statement of Work (SOW)
including mutually agreed to timelines. Timelines vary depending on the type of processing conversion,
POS Systems, and the method of processing communication.
The Wholesale Implementation Management Team takes total ownership of the conversion throughout
the implementation cycle placing the highest priority on timeliness, accuracy, and efficiency. The
Implementation Team will coordinate with you for all system conversions and training both one on one
and group sessions.
Implementation Process Flow
New Account Assigned
Credit Process Flow
- Merchant Account Set Up-= ~ - - ~ _
- - -Pre-Implementation Call- -
Account Implementation and Training
5
Confidential and Proprietary
PRODUCTS AND SERVICES
CARD ACCEPTANCE
WFMS has the ability to process all major Credit Cards, Debit Cards, and Purchasing Cards. Here is a list
of the available payment types:
Acquirer Processing
Visa MasterCard
Debit Cards American Express
Discover JCB
Diners Purchase Cards (including Data Rate III)
Gift Cards Private Label Cards
SUGGESTED PROCESSING METHODS
We offer a wide variety of innovative methods for processing your credit, debit and gift cards. Several of
which are available through Wells Fargo Merchant Services include:
Hardware/Software Solutions- WFMS is proposing that you use PayFlow Link software as the gateway
connection to your website. For the other locations, we suggest a terminal solution, such as the Verifone
Vx570. We resell this terminal for $699 per unit. The terminal has an integrated pinpad, enabling you to
accept PIN-debit transactions, which are considerably less expensive for you over credit cards.
Confidential and Proprietary
PROPOSED PRICING
Visa and MasterCard Interchange Fee: Pass through at processor's wholesale cost.
o Please refer to Attached Interchange Rates
Wells Fargo Processing Fee:
o This is based upon the average transaction size of each business unit. Please refer to page 9 of
this proposal for rate details.
ADDITIONAL VALUE
Next banking day funding to a Wells Fargo DDA
Dedicated Relationship Manager
Internet reporting obtained through the Commercial Electronic Office (CEO) portal
Confidential and Proprietary
WELLS FARGO MERCHANT SERVICES FEES
WFMS is pleased to have this opportunity to submit our proposal. The following fees were based upon
your annual Visa/MasterCard volume of $11,00,000 with an average ticket that varies.
Interchange Processing Fee
MOTOIInternet
Association
Interchange + Assessments + Authorization
Visa Pass Through* Incl See page 9
MasterCard Pass Through* Inel See page 9
Equipment:
PayFlow Link Purchase
Gateway Set-up $199.00
Other Fees:
Monthly Gateway Fee
S31.00 (web page only)
Statement Fee
$7.50 per outlet per month WAIVED
w/Clientline.net
Annual Fee
$45.00 WAIVED
On-Line Debit Fee
$0.08
American Express
Discount
3.50% (if desired)
Discover
Discount
Matches Visa rate
Non-Bankcard (Amex, JCB,
Diners)
Authorization
$0.08 per authorization attempt
Non-Bankcard (Amex, JCB,
Diners)
Capture
$0.03 per attempt
Address Verification
$0.01 per AVS attempt
MC Cross Border Fee
0.20% per non-US issued MC transactions settled
in US$.
MC Cross Border Fee
0.30% per non-US issued MC transaction settled in
non-US$.
Chargeback Fee
S 15.00 per outgoing chargeback
VRUVoice Authorizations
SO-75 per voice authorization attempt
Monthly Minimum
S25 in rocessin fees
Voice Address Verification Fee
$2.00 per attempt (manual)
Foreign Handling
0.10% on Visa foreign sales
My Clientline.net
$20.00 monthl -NA'aived
The processing of credit and debit card transactions is subject to the terms, conditions, policies and
procedures of the Visa and MasterCard Associations and the non-bankcard issuers. WFIfS Merchant
Services Agreement references and incorporates those terms and conditions. All Card Processing
responses in this document are subject to the Wells Fargo Merchant Sen,ices Agreement. If there are
conflicts with the terms and conditions in the iITFA1S Merchant Sers,ices Agreement and the terms and
conditions of this Request for Proposal, [I FWS will negotiate in good faith to resolve. The terms,
conditions, policies and procedures of the Visa and 11asterCard Associations and the non-bankcard
issuers are beyond 6VFVS control.
8
Confidential and Proprietary
Wells Fargo Merchant Services
State of California RFP Pricing Proposal
Effective 01118/03
Pricing Proposal
WFIVIS Front End (Cardnet, Nashville,Wellservice,FDR)
Average
Ticket
$1,000.00 and U
$500.00 - $999.00
$200.00 - $499.00
$100.00 - $199.00
$50.00 - $99.00
$30.00 - $49.00
$20.00 - $29.00
$10.00 - $19.00
$5.00 - $9.00
MCNISA
Discount
Rate
0.19%
0.20%
0.21%
0.23%
0.27%
0.34%
0.43%
0.59%
1.24%
Notes:
* Grid is fixed based on the individual agency's signed average ticket.
* Grid is valid for all processing modes (i.e. Retail, MOTO, Internet, etc.)
* Pricing proposal structure is Interchange + Rate (rate includes MCNisa
assessments and MCNisa access fees).
MCNisa rate applies to the gross MCNisa volume of each agency that signs with
Wells Fargo Merchant services.
* Each agency will receive the best interchange level for their transactions as a
straight pass through (see association interchange chart for interchange levels
and descriptions).
Non-Bank Card authorizations fees (Discover, AMEX, JCB, Diners) are $0.08 per
authorization attempt.
Debit transactions fees are $0.08 per transactions plus all applicable network
interchange, switch, and adjustment fees which are passed through to each
agency at cost.
* Wells Fargo Merchant Services offers a variety of custom reports 1 electronic files.
Sizing is required to determine actual cost. If Moneta reporting is chosen, a $5 per
month 1 per Moneta user ID fee will be assessed for the report.
Pricing assumes that the individual agencies will be utilizing an FDMS front end.
9
Confidential and Proprietary
wFL s
FARGO