[Jared_Weitz]

Well...the true word on the street is that ODC now does over 50% of their business direct (this is also backed up in their securitization prospectus). They are moving to do away with ISO's entirely. As a first blow, they are contacting a chuck of ISO's and offering ultimatum. Take a drastic cut in commissions or no more new deals. those who have no other options or power, take the bait.

I got two prequal offers for On Deck funding already for my Quickbooks accounts.

What I've seen happening kind of industry wide is as funders direct sales grow they will weed out any ISO business that isn't comparable to their inside business. So if their in house runs at a 7% bad debt they're probably going to hold on to ISO's at 7-8% bad debt or less......What I see starting to happen is as the industry grows and the direct funders sales forces grow they can and will become pickier on who they do business with. There are of course the funders who take more risk therefore see higher debts and profits. Those funders will be less stringent on which ISO's submit.