A lot depends on legislation but the next step for TranAct is a bank branded debit card. This solution is being used in some yards now. If you can get your customers to use this card for retail purchases, this model works. The merchants pay the transaction fees when the customer uses the card to buy goods. The problem is, Cash-Is-King and peddlers are skeptical about leaving the yard with a card. Also, if you calculate the cost to get cash, the transaction fees add up to much more than running a private ATM. Congress recently calculated that a banks average cost to do cash transactions at an ATM is less than $.50. TranAct’s scrap yard customers and banks own and operate their own high volume financial ATMs and the costs are similar, less than $.50 per transaction. Debit card providers often charge fees to move funds to cards that are $1.00 or more. Most retail ATMs in the US are owned by third parties and do much lower volume than bank machines driving up fees. The average ATM owners surcharge is over $2.50 in the US and the bank interchange charge adds $1.00 or more per cash withdrawal. We are up to $4.50 per transaction now. Most retail and bank ATMs limit daily cash payouts to $300.00 increasing the number of cash transactions. A cost affective debit card solution needs to include an all cash payout option without fees. TranAct’s debit card release will coincide with an ATM that can provide private and bank transactions. Peddler skepticism is hard to overcome but not taking anything away from them will help.
