educational

An iBill Update

After providing you with the first hint of a possible solution to iBill's problems, I received the following e-mail. It was sent out to iBill Clients (webmasters / merchants), in the wake of the mailing sent out to Customers (membership site subscribers and other consumers), which I reported on Friday. Rather than relying on interpretation and the misinformation common on industry message boards, I thought it would be best for interested parties to hear the latest news direct from iBill:

We want to provide you with a brief overview of recent developments and to encourage your participation in a scheduled conference call open to all Webmasters and Revsharers on Wednesday, November 3rd at 3pm eastern standard time.

iBill Direct
We are pleased to announce the roll out of our new domestic processing program, iBill Direct. Over the last 3 weeks, close to 70% of our client revenue base submitted applications to transition on to the new direct account. The program will provide you with all of the traditional iBill services and infrastructure, but will also include direct payment and settlement by the bank on a daily basis.

G-kard Stored Value
iBill has launched a stored value debit solution for domestic and international clients and RevSharers. iBill has partnered with G-kard, an existing stored value debit card solution, which allows consumers to instantaneously load a secure virtual electronic card in a real time 1-step process with a VISA or Master Card to make purchases anywhere on the Internet. The program can be configured for both single purchases and monthly recurring subscriptions. Clients and Revsharers will also have the ability to have sales paid out to their own G-kard account on a weekly basis which then can be used for immediate cash withdrawal at ATMs or point of sale purchases worldwide.

First Data Status
iBill is in negotiations with First Data regarding cash held by First Data Merchant Services. As many of you know, the relationship with FDMS dates back to 1998. Six years later, First Data has made it clear, privately and publicly, that the adult community is "inconsistent with its values." This being said, First Data owes our company money and our objective is to recover it for our clients. For your information, iBill maintained a charge back rate of less than six tenths of one percent prior to the First Data event. As a result, we believe we are entitled to the return of the deposits, currently over $14.5 million. We are doing everything possible to recover these deposits and will attempt to communicate with you more regularly.

Payout Schedule
iBill is committed to playing all outstanding balances owed to our Webmaster and RevShare community. We will host a conference call to roll out our payment schedule going forward as well as a payment program for past due months. Call details will be posted on the iBill CMI on Monday, November 1st for the November 3rd call.

Other Information
Dispelling misinformation, iBill is committed to the adult industry for the long term and we are here to stay. Our parent company is financially sound, recently completing a $16.5 million investment round (including $8.0 million from our management team).

This financing was completed with investors even after evaluating the effect of the First Data events, which we believe speaks to others' positive view of our financial viability. Moreover, in the midst of the current circumstances, we are joined by a new seasoned CEO, Mr. Charles Prast, which we believe is a positive indication of the future of our Business.

We are dedicated to the online payment processing space. Although, this has been a challenging time, we are confident that we will emerge as a stronger, more flexible company going forward. We deeply regret the hardships imposed on our valued clients.

Editor's Note: While the message from iBill is one of hope and optimism for those who have the patience to weather the storm, and indeed, some of their new initiatives seem to be quite promising, in today's fluid processing environment, "redundancy" is the keyword to stability – and success. While we all wish iBill the best, it behooves all merchants to ensure their cash flow by spreading out their processing to two or more IPSPs. After all, you're better safe than sorry... Be smart and stay safe! ~ Stephen

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