The Electronic Transactions Association (ETA) on Tuesday (April 19) announced “the roll-out of new Payment Facilitator guidelines offering guidance and best practices to new entrants regarding settlement, registration, funding delays, fraud, security and related issues.” Those guidelines are still being finalized and are not expected to be published until “May or June,” according to Todd Ablowitz, the payments consultant overseeing the guideline’s creation.
The document will only be available to ETA members. The document—which now stands at 85 pages, but could easily grow—is the most extensive compilation of protocols, procedures and best practices for payment facilitators yet assembled.
Amy Zirkle, the ETA’s director of industry affairs, said that a lot of the software companies that are salivating over becoming PFs know their software and their merchants’ environments and needs but they may not be nearly as familiar with the intricacies of modern payments systems. “These people will get into payments and they don’t always know a lot about payments,” she said. “This the nitty gritty of what needs to be considered to ultimately protect the payment facilitator. This is the quintessential toolkit for payment facilitators, showing new PFs all of the necessary steps.”
Areas covered include the particulars of submerchant underwriting, enhanced KYC details, submerchant risk management policy details, chargeback monitoring and investigation tools, appropriate submerchant remediation and reserve guidelines, due diligence lists, reputation monitoring and representment records and billing statements requirements.
Ablowitz argued that this extensive document is going to be sorely needed as the number of new PFs soars later this year. “With the regulatory pressure right now, ETA is taking a leadership role as a non-profit helping create self-regulation,” he said. “As these new PFs enter the industry, this will help them do it properly from the start.”
“Payment Facilitators are a growing segment of ETA’s membership and this project is the first of many aimed at providing insight to this new vertical,” said Jason Oxman, CEO of ETA. “The ETA Payment Facilitator Guidelines will set forth best practices to provide guidance to these new entrants to help navigate the complex payments landscape.”