Thinking About Selling Your ATM or Credit Card Processing Portfolio?
Deciding whether and when to sell your merchant portfolio, is often a difficult decision. There are no set standards or procedures for valuations in either industry however, having an idea of what investors will view as a positive or negative factor will help you to get a fair market value for your portfolio.
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There are two major things to consider when you sell your portfolio one is getting a fair evaluation two is will your clients be taken care of when you're gone. SummitPay will ensure both are taken care of.
Frequently Asked Questions
Have a question? These are the most commonly asked questions surrounding our products and services.
Will you switch processing platforms?
In most cases, we do not convert them unless we have a better buy rate on the same platform than the current ISO/Processor. We will pass on the savings to your customers.
After the due diligence process is complete, what else needs to occur to close the transaction?
We will provide you with the closing documents which include: an Asset Purchase Agreement, Bill of Sale, Personal Guarantee, and Non-Solicitation Agreement. The remaining document, an Assignment of Residuals Agreement, is usually provided by the ISO/Processor. Once all of those documents are fully executed, CLARUS Merchant Services will ACH funds to your designated bank account.
What other information will be reviewed during the due diligence process?
If you have Sales Agents and/or Referral Relationships, we will review copies of those agreements.
If I accept your proposal, what are the next steps?
Most Agent and/or ISO Agreements afford the Processor or ISO a right of first refusal to purchase the portfolio. When we come to an agreed-upon purchase price, you would contact your current relationship for approval. According to your existing contract with them, they will have a specified period of time (usually thirty to sixty days), to either approve our offer or purchase the portfolio themselves. If the Processor agrees to the sale, we will continue with our due diligence process and begin to prepare the remaining closing documents.
How long does it take you to perform an analysis and present an offer?
Depending on the size of your portfolio, analysis takes approximately 1-3 business days.
What information is needed to perform an analysis and valuation?
Your past twelve months' residual reports and a copy of your current ISO Agreement.
How much will I be paid?
The valuation of a portfolio or residual stream depends on many different factors. There are a number of metrics that are used to determine the value of a portfolio. Income attrition rate, account attrition rate, length of time the portfolio has been in existence, account concentration, margin earned, and merchant mix are example details taken into consideration. The purchase price is determined by calculating a multiple of the average monthly residual and taking into account the factors described above.
