Recently, the surety bond experts at Jurisco and their blog team read an article on AmericanBanker.com (an online financial publication) about the future of online payment processing, written by Deborah Peace (read it: here). In it, Ms. Peace outlays the growing trend of online payment processing along with the future regulatory challenges and concerns.
One point was clear: Online transactions will only continue to increase. Additionally, many new businesses will try to position themselves as players in this global game. And in California, it’s no different. Many of these start-ups will follow the business model established by the global leader in online payments: Paypal. Paypal also leads the industry in Automated Clearing House Payments or ACH. According to Paypal’s website, this payment service enables you to electronically collect payments from your customers for either single-entry or recurring payments by directly debiting your customer's checking or saving accounts. Such as for bill payment. Online payment software is a huge and growing industry. As Ms. Peace notes, with the world commercial economy shifting to a cashless world online payments will be ubiquitous and since so many billions of dollars will be exchanged daily over the internet the need for security and consumer protection becomes ever more important.
Jumping in to this breach with safety nets unfurling is the California Office of Administrative Law. And they come with their good book: The California Code of Regulations (CCOG). In the CCOG (Title 10, chapter 3, sub-chapter 10) the regulatory requirements for any entity that acts as a ‘bill payer’ are defined. One of the systems used to protect consumers from fraudulent activity and financial mismanagement of online bill paying is a legal device called a “Bill Payers Bond”. This Bond requires any “licensee engaged in the business of selling checks or accepting money for the purpose of forwarding it to others in payment of utility bills should obtain and file with the Commissioner a fidelity bond providing fidelity coverage on each officer and employee of not less than $50,000”
The bond experts at Jurisco realize the importance of protecting consumers and also the need for new business to be up to speed with all governmental requirements in California. So if you, or someone you know are in need of this type of fidelity bond, contact the surety bond experts at Jurisco for rates applications and more information.