One of the leading payment processing companies,
Heartland Payment Systems, Inc.
), has inked a deal with the merchant financing operations of
American Express Company
) - American Express Merchant Financing. This deal will make
Heartland the first processor to distribute American Express
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As per the deal, Heartland's clients will receive highly
price-competitive loans based on their annual card processing
volume. American Express Merchant Financing will let these
clients access an amount of up to $0.75 million. Thus, more and
more small businesses will be able to support their growth
requirements. Also, the deal permits Heartland's clients to renew
their loans 12 months after the initial disbursement.
Since the recent recession, small businesses have been struggling
to obtain loans to support their operations. Although these
companies are willing to incur expenses for enhancing their
operations and attracting more customers, most do not have the
necessary finance required to achieve this goal. Moreover, funds
are not as easily available to small companies as they are to
American Express' Merchant Financing, being a specialist in
providing funds for short-term investments, can aid these small
businesses as it offers loans that can be paid back over a period
of one year. Through its association with American Express,
Heartland intends to give its clients access to competitive loans
and drive growth going forward.
Heartland has been focused on providing solutions to enhance
operating leverage and improve the profitability of its clients.
We believe the above agreement is on par with this strategy of
Heartland. The tie-up with American Express should help the
payment processor retain its existing client base and maintain
its growth momentum in coming quarters.
Heartland currently carries a Zacks Rank #3 (Hold). Among other
financial transaction service providers,
Global Payments Inc.
) carry a Zacks Rank #2 (Buy). American Express also holds a
Zacks Rank #2 (Buy).