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Iowa’s merchant-card processing industry is getting a new player. Wind River Financial Inc., a rapidly expanding credit and debit card processing company in Wisconsin, has turned its attention to the Iowa market.

The Madison-based company last year processed approximately $1.2 billion in customer transactions, which makes it about the 50th largest card processor in the industry by volume, said Matt Uselman, Wind River’s president. Its clients in Wisconsin include Aurora Health Care, the Wisconsin Nurses Association, Parts Now! LLC and Wilderness Hotel and Golf Resort.

According to Hoovers Inc., the U.S. credit card processing industry is highly concentrated, with four major companies – First Data Corp., Total Systems Services Inc., Global Payments Inc. and Bank of America Corp. – accounting for approximately 40 percent of the industry’s annual revenues of $10 billion.

In Iowa, Wind River will face stiff competition from SHAZAM Inc., a Johnston-based, member-owned electronic funds transfer network, as well as from Meta Payment Systems in Sioux Falls, S.D., a division of Iowa-based Meta Financial Group Inc.

Uselman launched the privately owned business eight years ago with partners Mark Courchane and Phil Ingwell. The three friends grew up together in the Madison area and each worked in banking prior to starting Wind River. Uselman and Courchane are also brothers-in-law.

“We started in 2000 de novo,”

Uselman said. “Today, we have 45 bank relationships and over 4,000 merchant customers. And we haven’t advertised, really. That’s just from working with

the banks and calling on banks. The main reason for our growth is we retain 90 percent of our banks; we tend not to lose them. That’s why we’re looking at moving into Iowa. We see the communities as very similar.”

Wind River currently has 28 employees, who work primarily in service and sales roles. The company will focus on controlled growth and has not yet determined when it will establish a physical presence in Iowa, he said.

“Our goal is to do a great job with the customers we have and let natural growth lead us to the future,” Uselman said. “Because we’re privately owned, we don’t have the pressure that a bank or a publicly traded company would have.”

Wind River works directly with merchants as well as with banks as a partner in providing technology and expertise that can enable merchants to lower their processing costs by helping them navigate the complex merchant-card pricing system.

“Years ago there were three rates (a merchant could be charged on a transaction); now there are 300 rates,” Uselman said. “A common strategy is for processing companies to offer lower pricing, which may or may not materialize for the merchant. Our approach is more in-depth, to really understand the details of what they’re doing.”

Working closely with merchants to ensure data security is also an important aspect of Wind River’s services, Uselman said, as the major card issuers, MasterCard Inc. and Visa Inc., are enforcing rules more strictly and imposing larger fines on merchants for data breaches. “Our sense is that most card processors are not helping their customers through that process,” he said.

Among the first Iowa companies to use Wind River is West Music Co. Inc. The Coralville-based company, one of the largest music retailers in the country, saved $45,000 in credit card processing fees in its first year with Wind River, said Kelli Pence, West Music’s controller.

“They were helpful from the beginning in helping us understand the industry,” Pence said. “Before we went to Wind River, we were working with one of the biggest merchant companies out of Omaha. We were getting very little service, our rates were increasing and they wouldn’t work with us to address that.”

Uselman acknowledged that Iowa is a competitive market, with SHAZAM and Meta Payment Systems each having significant customer bases.

“They’re strong competitors, and that’s great,” he said. “Our goal isn’t to try to take over the world; we’re trying to create a niche business.”

For more information about Wind River Financial, visit www.windriverfinancial.com.