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Jul 2017

TSG In Digital Transactions: With Transaction Time Critical, a Strawhecker Platform Monitors Gateway Performance

What’s the measure of a well-performing payment gateway? Time. Or, rather a lack of time.

Gateways, which route online transactions to one of multiple payment processors, are judged on their speediness and reliability. That’s why The Strawhecker Group, an Omaha, Neb.-based payments consultancy, started its Gateway Enterprise Metrics platform. The service monitors the performance of participating gateways in real time.

In May, the average transaction time was 3.2 seconds for the seven gateways in the evaluation. The slowest transaction time was 3.6 seconds, and the quickest was 2.8 seconds.

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Jun 2017

TSG in ISO & Agent: Focus on Technology and Specialization

VARs and ISVs serve an important role in helping merchant acquirers and independent sales organizations (ISOs) make sense of a complex web of payments processing moving parts. But for those acquirers and ISOs that serve small and mid-sized merchants, VARs and ISVs are particularly critical. While large merchants typically have internal IT departments to manage the hardware, software, and services inte- gration that merchants need to process payments, merchants with fewer IT resources are reliant on someone else to manage the integration, explains Jared Drieling, Director of Business Intelligence for The Strawhecker Group. Acquirers and ISOs are turning to VARs and ISVs for help in meeting these merchant needs.

“Merchant acquirers and ISOs need to evolve to new market demands and are looking to VARs and ISVs to provide a bundled package of hard- ware and software that works together for their merchant customers,” says Drieling.

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Jun 2017

TSG in Digital Transactions: In Yet Another ISV Play, GTCR Buys Sage Payment Solutions for $260 Million

Finally, the rumors can stop. Sage Payment Solutions, the U.S. merchant-services arm of Sage Group plc, has been sold to GTCR LLC, a Chicago-based private-equity firm, for $260 million, GTCR announced Friday. Reports of a possible sale of the company, which counts approximately 100,000 merchants in its portfolio, originally surfaced in January.

That growth could come via providing services to software developers. It was one of the first merchant acquirers to actively court independent software vendors, says Peter Michaud, director of project management at The Strawhecker Group, an Omaha, Neb.-based payments consultancy.

“Through Sage Group’s [enterprise resource planning] products and other ISV partners, Sage Payment Solutions is positioned to expand into new ISV verticals and partnerships,” Michaud says in an email to Digital Transactions News. The merchant acquirer also supports the ISO and bank channel.

Strength in integrated payments is a valuable asset lately, as borne out most recently with First Data Corp.’s deal to buy CardConnect Corp., an ISV, for $750 million. “As with recent acquisitions in the payment industry, technology and ISV integration is highly valued,” Michaud says. “The investment commitment in the platform reveals that GTCR sees an opportunity to use technology to drive both revenue growth and operational efficiencies at Sage Payment Solutions.”

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May 2017

TSG in Digital Transactions: North American Bancard Buys Total Merchant Services As Acquirer Consolidation Continues

Two powerhouse independent sales organizations are joining together. North American Bancard Holdings LLC is buying Total Merchant Services Inc. for an undisclosed amount.

The acquisition, one of many NAB has completed in recent years, marks a significant increase in processing volume, transactions, and merchant locations for the company, says Peter Michaud, director of project management at The Strawhecker Group, an Omaha, Neb.-based payments advisory firm.

The result will be a greater economy of scale for the merged company. “The new entity will process over $50 billion annually from over half a million merchant locations, establishing it firmly as one of the top 10 merchant acquirers (by merchant count) in The Strawhecker Group’s Directory of U.S. Acquirers,” Michaud says in an email to Digital Transactions News. “In addition, this acquisition will expand their offering in the health-care, home/repair, and beauty/fitness verticals, which are high growth, underpenetrated markets.”

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May 2017

TSG Advises Card Payment Services (CPS) in its Acquisition by Cayan

Recently Cayan announced their acquisition of Card Payment Services (CPS). The Strawhecker Group is pleased to announce its role as strategic and financial adviser to CPS in this transaction.

“TSG proved to be a valuable partner in the strategic decision process, and saw the value we have built though our unique portfolio and ISV relationships.  Most importantly they were able to demonstrate our value and through their extensive industry relationships, allowed us to selectively market our company which resulted in our agreement with Cayan.”
Andrew Caine, President CPS

“By introducing CPS as an acquisition candidate to Cayan, TSG helped us enhance our vertically focused strategy. TSG highlighted the strengths of CPS while understanding our goal of servicing under-penetrated niche markets. This transaction highlights TSG’s expertise in the payments and merchant acquiring space and its leadership position as the “trusted adviser” to the highest tier of payments companies.”
Henry Helgeson, CEO and Founder, Cayan

May 2017

Now Available: Consumer Card Brand Sentiment Survey Results

The Strawhecker Group's (TSG) latest eReport, Consumer Card Brand Sentiment Survey Results, provides the findings of a market study that gauges consumer sentiment of major U.S. card brands, and related technologies, in terms of trust and usage.

Payment Types Covered:

  • Card Brands (American Express, Discover, Mastercard, PayPal, Visa)
  • Mobile Wallets (Android Pay, Apple Pay, PayPal Samsung Pay, Starbucks)
  • Online Buy Buttons (Masterpass, PayPal One Touch, Visa, Other)

Learn more.

Apr 2017

TSG in Digital Transactions: Despite Hundreds of Players, Just a Few Processors Dominate the Acquiring Industry

Consulting firm The Strawhecker Group is out with its 2016 rankings of U.S. merchant acquirers, and they show that 240 acquirers and independent sales organizations processed more than $5 trillion in payment volume. The 10 biggest acquirers accounted for 80% of that volume.

Topping the list is JPMorgan Chase & Co.’s Chase Commerce Solutions, which posted $1 trillion in U.S. volume last year. Next was First Data Corp.’s direct acquiring business, with $770 billion.

The next eight were: Bank of America Merchant Services, $730 billion; Vantiv Inc., $550 billion; U.S. Bancorp’s Elavon, $320 billion; Wells Fargo Merchant Services, $275 billion; Global Payments Inc. (excluding its Heartland Payment Systems and OpenEdge units), $200 billion; Citigroup Inc.’s Citi Merchant Services, $200 billion; Heartland, $130 billion; and TSYS Merchant Solutions/TransFirst, $120 billion.

First Data, however, is the clear leader when all of its sprawling acquiring businesses, including joint ventures with some of the nation’s largest banks, are added together. The Atlanta-based firm processes for BofA, Wells Fargo, Citi, SunTrust, PNC, and through them, scores of ISOs, many of them billion-dollar-plus entities in themselves. Combined, those five bank partnerships alone generated $1.31 billion in volume last year, putting First Data’s estimated total volume at more than $2 trillion.

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Apr 2017

TSG in Digital Transactions: The Battle of the Contactless POS Technologies

The overall goals of the contactless-payment provider play a key role in which technology to use, says Jared Drieling, business intelligence manager at The Strawhecker Group, an Omaha, Neb.-based payments consultancy.

A service like Chase Pay, which incorporates technology from the QR code-based CurrentC mobile-payments service developed by the Merchant Customer Exchange LLC consortium, is a closed-loop system, he says, while the Apple Pay, Android Pay, and Samsung Pay services have a different goal. “They view their mobile wallets as another prong to get mobile users onto their operating systems,” Drieling says.

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Mar 2017

Now Available: Directory of U.S. Merchant Acquirers

TSG's newest Directory of U.S. Merchant Acquirers is now available. This eReport features profiles on 240 Acquirers that include the country's top tier and technology-centered players.

This information, built upon primary and secondary research, provides an unprecedented and detailed look at the players currently involved in the merchant acquiring marketplace. The report is an excellent tool for competitive awareness, M&A activity, potential partnerships and general reference purposes. 

The data included was collected from the companies via a survey in early 2017, from public sources, and/or are estimates by TSG. Where illustrated, numbers have been rounded and are intended to be directional in nature. Company profiles include (as available) processor relationships, merchant vertical specializations, dollar volume statistics, transaction counts, active merchant outlet counts, corporate structures, sponsor banks, partnerships and more. 

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Mar 2017

Credit Card Chips: Industry Grapples with Costly POS Upgrades

Consumers love credit cards for quick and easy purchases. Merchants? Not so much. One big problem is fraud: Transactions with bogus plastic can drain significant sums from the bottom line.

In a move to address security concerns, the card industry has introduced plastic with embedded chips highly resistant to counterfeiting. Even so, many businesses are delaying the costly investments required to upgrade their point-of-sale (POS) terminals to read the new technology.

“By late 2016, only 44 percent of U.S. merchants of all kinds had installed chip-reading terminals,” says Jared Drieling, Business Intelligence Manager at The Strawhecker Group, an Omaha-based consulting firm specializing in the electronic payments industry. “And only 29 percent of merchants had activated such terminals to actually accept transactions.”

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