Cashing in on Credit: Small Firms Get Help Needed to Accept Plastic

Article excerpt

Jane Kusic understands firsthand the frustrations of small-business owners who would like to accept customers' payments by credit card but don't have enough transactions to get into the money pipeline.

Now Mrs. Kusic runs a company, Quantum Financial Inc. of Herndon, that specializes in hooking up small businesses with the companies that convert credit-card receipts into money in the bank.

For nearly eight years, Mrs. Kusic said, she couldn't take credit-card payments for her home-based crime-prevention business, White Collar Crime 101, because processing companies said the risk of fraud was too high among very small firms. This rejection came despite a client roster that included the Justice Department, the FBI and the U.S. Postal Inspection Service.

"I couldn't get a credit card until I started this business," Mrs. Kusic said of year-old Quantum Financial, which processes credit-card and debit-card transactions.

While her clients range from the Marine Corps' Toys for Tots Foundation to Andy's Auto Repair in Rockville, her company primarily focuses on obtaining credit merchant status for small and midsize businesses that otherwise might be unable to get service.

"We are essentially a merchant service provider," Mrs. Kusic said.

She and her husband, Daniel, identified the apparently underserved niche and invested $150,000 to start the company in May 1995.

Though Mrs. Kusic declined to disclose the financial bottom line, she said revenues topped $400,000 in 1995. This year she expects revenues between $850,000 and $1.25 million.

When a credit card is swiped through a slot or keyed into an electronic system, the information goes to the processing company's computer. If it clears the card as valid, the information is forwarded to the bank behind the card, and the merchant's bank account is credited, usually within one working day. …