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operation in an effort to encourage increased business. One area of concern is the golf course's current policy of accepting only cash or checks for payment. As it stands now, this policy forces players to carry large sums of money in order to gain access to the course. In the converse, a forgotten checkbook or a cash shortage would prohibit an individual from playing that day, resulting in an implied loss of revenue to the county. One-way of recovering some of this 'implied' revenue is to introduce a third method of payment, convenient to both golf course staff and the player, which would allow the customer to defer his debt to a later date. This is the purpose of a credit card. The'Credit Card Process By way of explanation, it should be understood that credit card companies receive their income from two major sources, the finance charge that the customer pays each month on his bill, and from the vendor - in the form of a discount charge on each invoice submitted to them. In this manner, credit card companies always ensure their own payment. For example, if the golf course submitted a bill for $100 to MasterCard for payment, MasterCard might charge two or three percent as their fee, and remit only $97.00 back to the golf course. From this example it would appear that the golf course would be losing money by having to pay $3.00 to have a $100.00 transaction processed, but this is not actually the case. Most people would not be pleased at the prospect of being forced to carry $100.00 cash to the golf course in order to play or make a purchase, and may choose not to deal with Sandridge because of it. Thus in this case cited above, the golf course actually made an extra $97.00 because credit card processing was available, it did not lose $3.00 because of the discount charge. Electronic Credit Processing Versus Manual Method When a vendor processes a credit card receipt for payment, he would traditionally take the card from the customer, check the "fraud" book (a book listing stolen and discontinued numbers), run the card through an imprinter and, at the end of the day, deposit his receipts with his bank, where it would be conditionally credited to the vendor's account, much like a check. (And, like a check, the vendor might have to wait for up to two weeks for the funds to clear, tying them up in the meantime, and preventing him from moving his money into a more profitable venture). Electronic Credit Processing Versus Manual Method -*continued A new method of processing credit cards for payment virtually eliminates the cumbersome problems found in the manual methods. With a credit card terminalsuch as Zon Jr. Plus, the entire transaction is moved electronically over the telephone lines. The operator takes the credit card from the customer and 'swipes' the credit card through a slot in the machine. The machine - which is on-line to the credit card company - automatically tells the operator whether the card is valid or not, and it also records the dollar amount of the transaction. At the end of the day, the machine totals all credit card transactions and will not 'close down' until balances are confirmed by.sales personnel. When balances are verified, the machine accepts the day's work and comes back with a confirmation number. A 'check' is written out by sales personnel - making reference to the confirmation number provided by the credit card company. The 'check' then becomes part of the deposit for the night. The bank treats the transaction like cash and credits the account with no hold on the funds - allowing instant use of the money. DEC 15 1987 11 BOOK 70 r,„cc. 346