As any new Canadian business can attest, it is incredibly difficult to obtain a merchant account that will allow you to accept credit cards online. Among the many obstacles, there are processing history requirements, large safety deposits, rolling reserves, and confusing PCI security demands that can vary between different processors.
Enter Jeff Malenfant and Nicolas Beique of Calgary-based Helcim. As their web development business grew, they began getting more requests for developing shopping carts and integrating payment gateways. They felt the pain that small business people go through to get an online merchant account with Canadian processors and banks. Talking with others in the industry, they discovered that Canadian businesses had for years been facing unrealistic entry-barriers. And on more than one occasion, they even had representatives from major Canadian processors tell them that online processing was too complex for most small businesses and to try PayPal.
Frustrated with the industry, Malenfont and Beique saw a window of opportunity. After much deliberation, they sold their web development business, negotiated the required venture capital from investors, and went on a two year crusade to change the Canadian credit card payment industry. The biggest challenge was establishing partnerships with VISA and MasterCard member banks. They quickly realized why the Canadian space was such an aggravation compared to the US. With only a handful of banks in Canada, each with a large stake in a card processing company, none were willing to give up the rights to process their credit cards. This monopolistic situation was responsible for the horrid processing services experienced by Canadian businesses; without much competition processors simply didn’t have to put in the effort.
When all hope seemed lost, they received a phone call from a large US bank that had heard of their attempts to start a new processing company. Luckily this bank wanted to boost their card acceptance business with their Canadian commercial banking divisions. After a few months of negotiations, paperwork, audits and certifications, Helcim was launched in the fall of 2007.
Since their launch, Helcim has doubled their client base every month – many of which had given up on their goal of accepting credit cards online. Helcim created a sign-up process that is fast and hassle-free, with a fee structure that gives even the smallest start-ups a shot at online success. This year their goal is to continue lowering entry-barriers so that everyone can have a chance to participate in the new online economy.