Many companies getting ripped off in 2014

It's 2014 and businesses are getting in gear for the new year. The problem is that many companies don't even realize how much they are "actually" paying for credit card processing. The merchants statements provided by most processors are designed with one thing in mind: to fool you. They are afraid that once you realize what you are truly paying, you will go elsewhere. This is why so many processors will attempt to lock you into a contract, usually for 3 years. I have seen companies like Bank of America charge non-qualified cards (business credit cards) at 14% and the business had no idea! The important thing is first, never sign a contract (say it again, this time with feeling). The second thing is, find out if your processor is  hitting you up with hidden fees. Starting the new year is a good time to reassess your bills and make sure you are not overpaying for services. For many, merchant services should be the first place you look to for savings. On average Prestige Merchant Services has saved companies 20-50% off their current monthly merchant service bill. Unlike other processors, they will give it to you straight and if you actually have a great deal they will tell you there is no need to switch (unless you are getting crummy customer service, in which case you probably should). If you want to make sure you are not overpaying on merchant services and like the idea of possibly saving thousands for the upcoming year, get a merchant statement and contact a reputable merchant service provider for better rates. They have professionals that can make sense of those difficult-to-read merchant statements that usually will give a forensic accountant a big headache.

High Risk Credit Card Processing- Not Easy to Find!

Most companies can find it difficult to get approved for a merchant account if they fall into the category of High Risk. Many processors are unwilling to deal with companies that deal with firearms, travel, e-cigarette, tobacco, Adult products, weight loss, ticket sales, debt consolidation, TMF, dating websites, credit repair, collection agencies and more! You may have trouble finding a reputable company that won't treat you fairly until now. For High Risk Credit Card Processing you can contact Prestige Merchant Services. They handle the highest risk merchant accounts so if anyone can approve them, they can.

Square UP Payment - Big Problems for Serious Businesses

Square is a mobile credit card system that took the wireless merchant service industry by storm with it's free swiper and no monthly fees. The questions is, are they the solution for anyone wanting to accept credit cards? The answer seems to be no.

Risk:

Square is not a bank but rather "money mover". As they don't require any credit check they can't truly asses your risk of going bankrupt. This then translates into longer time frames for deposits, usually several days to as much as several weeks. I have heard of merchants being told  they will have a 30 days freeze on their account due to their dollar amounts being larger
than what Square wanted to handle and other various possibilities.

Rates:

Square's rates may seem low as they have no monthly fees but their rates are much higher
than interchange rates and can be as much as 3.25% for keyed in. Many people have reported
that they have a tough time getting the swiper to work at times (hey it is free) and then have to key in and pay 3.25% which is much higher than the true interchange rate


BBB Report:

Although the BBB reports Square as an A- complaints are gaining to almost 500 complaints.

Customer Service: There is practically none when it comes to Square and it is reported that if you call it will probably  go to voice mail. Many customers complain about the swiper not working often. If you are serious about mobile credit card processing try going with a true mobile credit card processor.

Processor is Sued by Merchant over $28,000

I was not surprised to learn that EVO Merchant Services was sued by a plumbing business:

 GALVESTON – Parker & Pompa Inc. has filed suit against EVO Merchant Services LLC, Discovery Bank, Discover Financial Services and Do It Best Corp. in an effort to recover nearly $30,000 in back credit card payments. Recent court papers filed Oct. 8 in Galveston County Court at Law No. 2 explain that the defendants failed to remit $28,490.97 generated from Discover Card charges from the plaintiff’s customers from Oct. 7, 2008, through April 9, 2009. The suit shows the complainant, doing business as Ideal Plumbing Co., entered into a contract with EVO, doing business as Bank Card Depot Inc., which called on the former to submit information pertaining to Discover Card charges made in Galveston County during the special time period. In turn, according to the agreement, EVO promised to acquire and process the charges. Meanwhile, the plaintiff and Do It Best executed a contract to which the latter agreed to accept the funds released from the proceeds in question and place them in an account attributed to the complainant as well as disburse and forward the subject money to the former. EVO received written statements itemizing the dates and amounts of the aforementioned charges and forwarded the documentation to Discover Bank and Discover Financial Services, which supposedly processed the information and gave the amount in dispute to Do It Best, the suit states. Parker & Pompa alleges it did not get the $28,490.97, insisting the defendants “have failed and refused, and continue to fail and refuse” to pay. Attorney Michael L. Wilson with Rider & Wilson in Galveston is representing the complainant, and Galveston County Court at Law No. 2 Judge Barbara Roberts is presiding over the case. Cause No. 68,458

Evo has many complaints listed against it. I happen to know they have some of the most corrupt practices
when it comes to hidden fees and padding their pockets.

VeriFone Copying Square's User Agreement?

It's really pathetic when an established company like VeriFone attempts to steal it's user agreement almost word-for-word from it's competitor. When VeriFone was notified of this copyright infringement they took quick action to modify it and shaved down their user agreement quite a bit. As per Gigaom:

“When we said that Square made it easy to swipe, we meant credit cards,” said Square spokesperson Aaron Zamost. Sean Kane, a member of law firm Pillsbury’s social media, entertainment and technology team, said a company caught copying another firm’s legal user agreements or terms of service could be sued for copyright infringement. But that is rarely pursued when it comes to terms of service and user agreements. It is still an issue, said Kane, because companies who copy a user agreement or TOS could be accused of fraud if their service actually differs from the user document. That could be a problem now for VeriFone, which now has a slimmed-down user agreement that doesn't address many key points about the service.

The truth about Intuit Go Payment

The bottom line is this:


When things look to good to be true, they usually are.


Here is what an Amazon reviewer stated about Intuit Go Payment:

I got this app as it seemed to have more competitive pricing than Square. For a $12.95 monthly fee I am in the lowest rate program available: 1.7% for swiped transactions, and 2.7% for manually entered. However, I am always charged between 2.7 and 3.7% plus a transaction fee. The reason given is that the cards I am charging are "reward" cards of some type. So I get charged the low fee and at the end of the month every transaction I have ever made has at least 1% added to it. I know many of these card are not reward cards, although the vast majority of cards nowadays are. Customer service has been as pitiful as other processors I have used. 




These are just some of the reasons to use a reliable merchant service provider who will not hide fees and lock you into a contract.

Beware of Bait and Switch Rates!

As mentioned previously, when  looking for a competitive deal on a merchant account, beware! It's good to know that I'm not the only one warning people about the pitfalls of "teaser rates". Like anything in life, "if it's too good to be true, it probably is". If you have learned nothing else from reading this blog it should be this: Never sign a contract! The rate should also not be the only determining factor in which merchant service provider you choose. A merchant account is a very important aspect of your business and if something goes wrong, you want to know you are dealing with a company that can service you well and quickly. It is very unusual to get the deal you are sold and that's because the hidden fees will keep you in the dark. Make sure you do your homework and pick the company you are most comfortable with. This will help you in getting a true
deal on credit card processing.