Profile: Global Payments Inc (GPN.N)
14 Mar 2014
Global Payments Inc. (Global Payments), incorporated on September 1, 2000, is a provider of electronic payments transaction processing services for consumers, merchants, independent sales organizations (ISOs), financial institutions, government agencies and multi-national corporations located throughout the United States, Canada, the United Kingdom, Spain, the Asia-Pacific region, the Czech Republic, and the Russian Federation. The Company serves as an intermediary to facilitate electronic payment transactions and operates in two business segments: North America Merchant Services and International Merchant Services. In March 2014, the Company acquired Payment Processing, Inc, provider of payment solutions.
The Company accepts a range of card and electronic based payments at the point of sale. The Company's business model provides payment products and services directly to merchants as its end customers. The Company also provides similar products and services to financial institutions and a range of ISOs that, in turn, resell its products and services, in which case, the financial institutions and select ISOs are its end customers. These services are marketed in the United States, Canada, and parts of Eastern Europe. The Company provides its merchant customers with the ability to accept check, card and electronic-based payments. The Company sells its services through multiple sales channels globally. Card-based payment forms consist of credit, debit, gift, stored value, and electronic benefits transfer cards. Credit and debit card transaction processing includes the processing of international card brands, including American Express, China UnionPay, Discover, JCB, MasterCard, Visa and non-traditional payment methods, as well as domestic debit networks, such as Interac in Canada. Electronic payment processing involves a consumer or cardholder acquiring goods or services from a merchant and using a credit or debit card or other electronic method as the form of payment.
The Company is the processing intermediary between the merchant, the credit and debits networks and the financial institutions that issue cards. The Company's offerings include terminal sales and deployment, front-end authorization processing, settlement and funding processing, full customer support and help-desk functions, chargeback resolution, industry compliance, payment card industry (PCI) security, consolidated billing and statements, and on-line reporting. Its merchant services revenue is generated on services priced as a percentage of transaction value or a specified fee per transaction, depending on card type. The Company also charges other fees based on specific services, which are unrelated to a range of transactions or the transaction value.
North America Merchant Services Segment
During the fiscal year ended May 31, 2012 (fiscal 2012), North America merchant services revenues represented 71.8% of the Company's revenues and include operations in the United States, Canada and Brazil. In the United States, the Company sells its services through ISOs, a direct sales force, trade associations, agent and value added reseller (VAR) referral arrangements, as well as telesales groups. The ISOs contract with Global Payments to provide processing and other services depending on the ISOs' requirements. These contracts are multi-year and priced by service on a per transaction basis. The ISOs act as a third-party sales group selling Global Payments-branded merchant acquiring products and services. The Company's United States revenue also includes check and gaming services and indirect merchant services. The Company's check products offer merchant customers risk management alternatives, in the case of the Company's verification and recovery offerings, or risk elimination, in the case of its guarantee offerings, by leveraging its internal and external databases of check writers to help decide whether the merchant should accept a check as the form of payment from a particular check writer.
The Company's check services products are part of the Company's direct merchant service offering. Under the guarantee service, when a merchant receives a check in payment for goods and services, the transaction is submitted and analyzed by the Company. The Company either accepts or declines the check for warranty coverage under its guarantee service. If the Company approves the check for warranty coverage and the merchant accepts the check, the merchant deposit the check in its bank account or process it for settlement through the Company's electronic check acceptance service. If the check is returned unpaid by the merchant's bank and the returned check meets the requirements for warranty coverage, the Company is required to purchase the check from the merchant at its face value. The Company then owns the purchased check and pursues collection of the check from the check writer. The Company earns a fee for each check guaranteed.
In the specialized vertical market of gaming, the Company's VIP LightSpeed software and VIP Preferred Advantage product provide the gaming industry with the tools to establish revolving check cashing limits for a casino's customers. The Company derives revenue from its gaming products based on a percentage of the transaction value.
International Merchant Services Segment
During fiscal 2012, international merchant services revenues represented 28.2% of the Company's total revenues and included operations in Europe and the Asia-Pacific region. The Company's business in Europe is located in the United Kingdom, Spain, the Czech Republic, and the Russian Federation. The Company's Asia-Pacific region includes 11 countries and territories: Brunei, China, Hong Kong, India, Macau, Malaysia, Maldives, the Philippines, Singapore, Sri Lanka and Taiwan. In the Czech Republic and the Russian Federation the Company also provides indirect merchant acquiring services.
The Company competes with First Data Corporation, Bank of America Merchant Services, Chase Paymentech, Wells Fargo, Vantiv, Heartland Payment Systems , Elavon, Chase Paymentech Solutions, TD Merchant Services , WorldPay, Barclays, Banco Bilbao Vizcaya Argentaria, S.A, Caja Madrid, Sberbank, VTB, Raiffeisen Bank, Russian Standard Bank, Banco Popular, SiNSYS, Euronet and Bank of Montreal.
Global Payments Inc
North Tower, 10 Glenlake Parkway
ATLANTA GA 30328