MoneyTech will officially launch its DealerCard initiative for distributors and resellers on June 15. The company claims the project will inject $350 million worth of funding into the industry.
Managing director, Hugh Evans, said the decision to develop a credit card for the IT channel had proved to be a huge project. Originally slated for launch in October, it had been held up due to impediments with the sheer scale of the legal and insurance paperwork and building backend systems, he said.
"If I'd known how big a project it was on day one, it would have scared me right off," he said. "I misjudged the size and scale of what we're doing.
"We're building a system that will scale to do about $500 million of transactions. We can't get it wrong."
DealerCard provides resellers with up to $250,000 worth of credit to purchase goods.
Among its list of benefits are 30 days interest-free credit, up to 118 days to pay and automated ordering.
Most resellers have accounts with up to five distributors, Evans said. "This opens the door to purchasing from other parties," he said. "We're hoping this will stimulate the industry and help it grow."
Evans said he now had 22 distributors signed up for DealerCard including Cellnet and Brightpoint. But several key players are yet to sign up to the program, claiming high merchant charges and risk were a deterrent. Australia's largest supplier, Ingram Micro, is a glaring omission.
"We think they [Ingram] are a critical part of what we want to do, but they have been internally focused on the merger with Tech Pacific," he said.
Evans said he was hopeful Ingram would sign up once the card was officially live.
Ingram communications manager, Geoff Isaac, said it had looked at the card in the early days but decided against endorsing it.
Synnex managing director, Frank Sheu, said it had also decided against signing up to DealerCard. Resellers spending more than $20,000 with Synnex were entitled to free credit without surcharge, he said.
Both Isaac and Sheu suggested the high cost of becoming a merchant with MoneyTech had turned them away from the program.
General manager of Dovetail Distribution, Max Fredericks, said he had discussions with MoneyTech several months ago but felt it was still too early to join up.
"We felt that the profile of our customers didn't fit with the card," he said.
"We also wanted to get a better understanding of how widely it would be adopted."
With the number of distributors and resellers now building, Fredericks said it might be time to revisit the possibility.
MoneyTech now has 500-600 resellers waiting to use the card. This is a far cry from the figure of 2000 Evans nominated last year.
He said it had taken longer than anticipated to process applications but said the company was content to go live with its current reseller numbers. The company now hoped to have 2500 card holders by the end of its first year, Evans said.
AfterDark managing director, Peter Davies, said he had not heard of the DealerCard program.
At first glance, however, he suggested the card looked like an appropriate idea for very small resellers. "Cash flow in a small business is king - increasing that flow will help their growth," he said.
MoneyTech will conduct training sessions with all of its distribution partners from June 15 until August.
The service would be piloted by select suppliers with live paper-based transactions during that time. Once training had been completed and all cards had been issued to resellers, the system would be available across all of its merchant partners.
Alongside the launch, the company will also introduce its reseller loyalty program, MoneyTech Money.
The program will provide resellers with reward dollars for selling select stock, which they will be able to redeem with their distributor or vendor. The DealerCard launch will also coincide with the availability of its rental quotation system for its RentCard program. RentCard, which went live in March, allows resellers to pass on pre-approved rental finance to customers.
Evans said 50 resellers were now accredited for the RentCard scheme, ranging from one-man consultancy firms through to bigger integrators.