Web Transaction Services Spreads the Wealth

John Stuart
For more than a decade, online payment processor Web Transaction Services (WTS) has served merchants well with its Automated Clearing House (ACH) billing system.

"That was our niche in the adult marketplace," said WTS CEO Bill Parodi. "That's what we cut our teeth on. We really refined that process, and it allowed us to be a leader in our space."

But recently, WTS also has become an Internet payment service provider (IPSP), offering its EU-IPSP system, which processes credit cards. This promises to allow WTS continually to expand its payment options and the products it offers to the webmaster community.

"It's about consolidation," said Khalid Mohiuddin, chief operating officer of WTS. "The era of having point solutions — where a merchant needs to figure out if they'll have a credit card processor — an ACH processor, a mobile processor and so on has pushed too much work on to the merchant. Merchants are expending a lot of energy trying to create reliable, robust systems. We want to take that burden away from the merchants and allow them to focus on what they do best, which is driving traffic, providing compelling content and innovating in terms of cam sites and other things.

"Consolidation allows us to make merchants more money," he said, "by providing the appropriate billing solution to the consumer who comes to their site, regardless of where they are around the world."

Removing burdens from merchants while finding ways of increasing their revenue is, in fact, the basic philosophy of WTS — and the secret to its success.

"We don't win unless the merchant wins," Parodi said. "So it's in our best interest to make the merchant win. Our business model is fully aligned with the merchants. That's why we offer suggestions, like finding safer ways to increase their revenues. Our merchant support is unparalleled in the industry.

"And merchant feedback has been very positive because our system is like finding new revenues on your existing traffic. For example, we have an innovative product on the ACH side where we design the ACH specifically for cam sites or the pay-by-minute sites, and we present it simply, as if it was a credit card model.

"If you have a cam site that uses card billing, you can use our WTS cam solution, which looks like a card integration but actually bills through ACH. By offering the ACH cam product as a payment option, merchants can add a new revenue stream that doesn't take away from their existing credit card sales. The people who use this payment option don't have or won't use credit cards for cam sites. It's a unique system, and I don't think anyone else in the marketplace offers it right now. Obviously, it's been well received," he said.

The WTS brain trust has innovations on the drawing board, too — specifically regarding mobile billing and new alternatives involving debit solutions.

"European debit has come around, and Chinese debit is just starting up," Khalid said, "People like to use debit solutions, so we're integrating those soon."

Of course, innovations are attractive to customers, but no payment processor can hope to survive without a strong customer service department, and WTS has one of the best.

"It's critical," Parodi said. "Especially now, when chargebacks and similar things are happening all over the world. There are unauthorized returns and chargebacks associated with every mode of processing, and the only way to deal with that is to provide two things: One is compelling value for the dollar on the merchant side, and the other is to provide 24/7 quality customer service, where the consumer can talk to a human being. Pushing touch-tone buttons ticks people off, so we have 24/7 customer service taking consumer calls and talking to them about their billing issues."

This service is especially vital in the adult marketplace — an arena that Khalid knows very well.

"We understand the market, and not just in the billing end," he said. "I've been in the merchant end of the adult business, so we understand what merchants are trying to do. We also are familiar with affiliate fraud because adult merchants are plagued by people trying to get money this way. If we tighten the links between us and the merchant, then the merchant has more access to real-time information, which makes it easier for them to combat that kind of fraud.

"The safeguards we use are typically from the compliance perspective," Parodi added. "We have a dedicated compliance team that reviews all of our merchant sites continually. We also have a feedback mechanism, where we talk to merchants through out merchant support department. We call their attention to things like providing full disclosure for consumers on their sites. When the consumer understands what he's buying, he's less likely to be unhappy — and less likely to ask for a refund."

The ongoing care for merchants at WTS will continue with the firm's new special offer of a month of free processing for anyone who opens a WTS-EU credit card account through the company's coded ad in XBIZ World.

This attention to merchants is a lesson learned long ago, when Parodi and his cousin Dan started WTS in early 1997. Parodi's father had owned a processing company for a couple of years, and the cousins worked there as salesmen.

"We saw the potential for processing in the adult space," Parodi said, "so we created our own company built on ACH. I was in Dallas, and my cousin was in Atlanta, and for the first few months in business we both worked on our computers at home in our boxer shorts. After a few months, we decided to get together, and we had to choose a city to base the company. Dan refused to move to Dallas, and I wouldn't go to Atlanta, so we settled on Austin. We moved to Austin, and it was a three-person operation at first, with Dan's wife, Jill, working with us. We did everything ourselves — customer service, sales, marketing, bookkeeping."

A little more than a decade later, the trio has morphed into a company that employs more than 50 people in its Austin and Toronto offices.

Just goes to show what happens if you treat the merchant right.