Customer Fights First Data Over Teaser Rates!

This is just in the news today! A small business owner was being taken advantage by First Data processing. The story explains that Rohan Shetty owns a small hot dog stand in Sussex County, NJ.As a small business owner she can't afford to be paying lots of money in merchant service fees.She figures out that the rates she was told were not the rates she was getting! Unfortunately this is a common practice for a credit card processor to offer teaser rates and then hike them up very quickly. They usually try to lock you into a contract so you are stuck paying those high fees for years. This is why if nothing else always avoid a contract. Few companies advertise no contracts but some merchant service providers will offer it.

EMV Technology: Hurting Merchants?

One of the latest discussions many merchants have been having is the new implementation of the EMV technology for credit card processing. One of the biggest issues that are arising for merchants, is how slow the chip readers can be. This will be detrimental to sales when the holiday season comes around. Imagine long lines of people many of whom will simply ditch their shopping carts and go elsewhere as the readers take forever to approve a transaction? The problem stems from the platforms the merchants are using to process the chip readers and not the reader itself. If you are looking for a solution to your chip reader issue and want one that is the fastest you can find, contact Prestige Merchant Services. The platform they utilize has a median time of 1.60 seconds for the terminal interaction with the chip. Chip reading does not have to be slow any longer.

Law Firm Merchant Account

Law Firms at times need specialized merchant accounts. This may be do to the fact that they have money in escro or they need to send out a bill. Make sure to find a good Law Firm Merchant Account that can handle your Law Firm needs.

The right point of sale (POS) technology can help your back office operations run much more smoothly so your attorneys and staff aren’t side-tracked to deal with administrative headaches. With law firm payment processing from Prestige, you can:

Easily track your clients’ appointment history, side-by-side with their complete case histories—without having to fumble through paper records

Streamline, or even automate, client appointment reminder calls, via SMS text or email confirmation

Track and manage inventory of your office supplies 

Allow your clients to pay how they want to pay.

Would your clients prefer to pay for your services online, via a mobile app, or in-person using a credit or debit card? When you partner with Prestige for your law firm credit card processing, the choice is theirs—and the list of options is growing all the time. In fact, payments industry experts estimate that by the year 2020, there will be 455.1 million mobile wallet users.

Consider choosing a law firm credit card services partner that enables your office to accept the latest in payments options—including mobile wallets—in order to attract new, young clients, as well as keep your current clients happy. Today consumers expect the very latest in payments processing wherever they go, even when they’re at their attorney’s office.

Built-in payments processing wins the case.

When you choose Prestige for your law firm credit card processing, you won’t have any surprises or additional software to buy. In fact, our payment processing is already built into the most popular POS systems for attorneys. Your new payment solution will be ready to go from day one, meaning there will be less downtime and more revenue coming in for your office.

EMV and the liability shift

Apparently many businesses have been slow to adapt to the latest security standards known as EMV which utilizes the chip in the latest credit cards to thwart fraud. I already posted at length about EMV technology and how it operates with regard to a credit card machine. More importantly the discussion of the liability shift as of October 2015. Those retailers not utilizing the EMV technology are now left holding the bag if fraud is committed. The Wall Street Journal reported the story of a grocer that was hit with a $4000 charge as they had a series of fraudulent charges and had not switched to the EMV credit card reader.

Unfortunately many small business owners have been hesitant to switch due to the high cost of EMV credit card machines. Many processors are charging upwards of $5-800 for an EMV ready credit card terminal as they are taking advantage of the need for new equipment. There are processors such as Prestige Merchant Services who offer a free EMV terminal program to businesses looking for competitive pricing without a contract and don't want to pay for new equipment. Be careful about which processor you deal with as many will attempt lock you into long term contracts and will try to lease you equipment that will cost you 10-20 times what the credit card terminal is worth.

PayPal Class-Action Settlement

It seems that a settlement has been reached against Paypal for some really horrible business practices.

I have been telling people for years that dealing with PayPal could have dire consequences especially for small business owners. Many PayPal users may have received an email with the following message:

NOTICE OF CLASS-ACTION SETTLEMENT. THIS NOTICE MAY AFFECT YOUR RIGHTS. PLEASE READ IT CAREFULLY.

A settlement has been reached in a class action in which the plaintiffs allege, among other things, that PayPal improperly handled disputed transactions on PayPal accounts and improperly placed holds and reserves on accounts or closed or suspended accounts. Plaintiffs also allege that PayPal failed to provide annual error-resolution notices and monthly account statements under the Electronic Fund Transfer Act. You are a member of the Settlement Class if you had an active PayPal account between April 19, 2006 and Nov. 5, 2015. Certain Settlement Class Members who had a hold or reserve placed on their account and/or who had their account closed or suspended by PayPal are eligible to receive a monetary payment upon submission of a valid claim form. This notice summarizes the proposed settlement. For the precise terms and conditions of the settlement, please see the Settlement Agreement available at http://www.accountholdsettlement.com/, by accessing the Court docket in this case through the Court's Public Access to Court Electronic Records (PACER) system at https://ecf.cand.uscourts.gov, or by visiting the office of the Clerk of the Court for the United States District Court for the Northern District of California, 1301 Clay Street, Oakland, CA 94612, between 9:00 a.m. and 4:00 p.m., Monday through Friday, excluding Court holidays.

PLEASE DO NOT TELEPHONE THE COURT OR THE COURT CLERK'S OFFICE TO INQUIRE ABOUT THIS SETTLEMENT OR THE CLAIM PROCESS.

10 Tips on Avoiding Chargebacks

Chargebacks are something all businesses try to avoid at all costs. Have too many chargebacks (as little as 1% of the total amount of your sales) and your merchant account might be terminated. That would mean you no longer could accept credit cards and that would hinder any business.

What is a chargeback?

There are a few possibilities for a chargeback but the most common cases are:

1) Customer is unhappy with the product or service they were given.

2) Customer is disputing the charge because it was never authorized (I never bought this!).

3) Clerical- Customer is double billed or billed incorrectly.

4) Insufficient funds.

There are variations of this theme such as the customer does not recognize the name of the biller (which is why you should always try to keep the name on the bill the same as the business type).

In most cases a customer can have up to 120 days (depending on the type of card) to chargeback a transaction and/or they have an issue with the product purchased.

10 tips to avoid chargebacks:

1) Avoid Clerical Errors

Make sure you are careful about the information you are using when billing the customer

Visa has some great tips here

2) Use Your Company Name on the Bill

If the customer does not recognize the name of the company for the charge they are more likely to charge it back due to fraud or unauthorized use.

3) Get a Contract

Basically make sure you have an agreement signed for the product or service you provide. 

If they signed off on it, it will be hard for them to dispute it.

4) Dispute it

If you think the chargeback is unfair or fraudulent it may be worth fighting (if you have time) and dispute it as each chargeback has a fee associated with it.

5) Protect yourself against fraud

Many companies won't ship out items if they don't match with the billing address or if the security code is wrong. They might then  contact the customer to verify the purchase is legitimate.

6) Don't Wait

If your company is notified about the chargeback it would be best to contact the customer right away and resolve any chargeback disputes.

7) Clarity

Be clear about the service or product you are selling! Don't lie or leave out things about your product or service as that is one way to almost guarantee the customer will chargeback.

8) Policies

Make sure you have clear return/refund policies stated on your website or store. This way there are no misunderstandings and you are less likely to have a dispute.

9) Call Me

Make sure the customer knows how to contact you. If your phone number is readily available on the bill the customer is more likely to call first then charge it back.

10) Set the right expectations

If you provide truthful expectations about your service or product you are less likely to have a dispute. A great example: Delivery dates or stock availability.

EMV Credit Card Machines

If you have a merchant account and especially if your have a credit card machine you may have heard about EMV technology. 

EMV stands for Europay, MasterCard and Visa, have developed new technology to increase security with regards to transactions.  As a result merchant's using credit card terminals not offering this technology will bear the responsibility of any fraud as of October 2015! EMV credit card terminals can be expensive and it would be smart not to get stuck with a lease where you usually end up paying 10-20 times what the credit card terminal is actually worth. There are processors that will offer free emv credit card machines. Most companies offering free credit card terminals may  have a contract so make sure the one you choose does not or you may get stuck with hidden fees. 

Here is some more information on EMV: 

The deadline is fast approaching for businesses to transition to EMV card technology. 

WHAT IS EMV?

EMV cards contain a chip, in addition to the traditional magnetic strip, that is used to transmit data. Unlike standard magnetic card, EMV cards create a unique transaction code every time they are used. Each code can only be used once, making fraud more difficult and less likely to occur. 

WHAT IS THE PURPOSE OF EMV?

Create Universal Standards EMV has been around since 1992 U.S. is one of the last to adopt the card technology Makes traveling and doing business overseas easier Increase Security U.S reported $11 billion in credit card fraud in 2013 (Almost half of the world’s credit card fraud) EMV can help protect both consumers and businesses Fraud losses for brick and mortar retailers dropped 60% in the UK after adopting EMV technology

HOW TO PROCESS EMV TRANSACTIONS

EMV is a card-present technology that can be processed several ways.

Contactless Those individuals with NFC enabled cards (dual mode) can tap the card in front of a NFC enabled POS device and then provide either a PIN or signature. Chip & Pin Insert the card into a POS device which keeps the card until a PIN number is provided. (Most used worldwide) Chip & Signature Instead of providing a PIN to complete a purchase, this process just requires a signature. (Most likely to be implemented in the U.S.) Chip Only If a transaction is under a specific floor limit, neither PIN nor signature may be required.

UNDERSTANDING THE FRAUD LIABILITY SHIFT

Mark Your Calendar for October 2015 While each card payment brand (Visa/Mastercard/Discover/American Express) has their own unique description for the changes in liability, all agree that beginning in October 2015 when a fraudulent transaction occurs, whichever party (Merchant/Processor/Card Issuer) is the cause of the contact chip transaction not occurring will be held financially liable for any resulting card present counterfeit losses.

Responsibilities By the end of 2015, an estimated 70% of credit cards and 40% of debit cards in the U.S. will support EMV Merchants are responsible for having and EMV-compliant terminal Merchants are responsible for working with their Processor to ensure that the terminal is capable of accepting EMV transactions

PREPARING YOUR BUSINESS FOR EMV

When it comes to preparing your business for EMV adoption and standardization, the countdown is on. As a retailer, your first order of business should be the development of a detailed, time-sensitive EMV roadmap. Use it to outline the steps you'll take to be in compliance by the time October 2015 rolls around. By having everything upgraded and ready to go ahead of time, your business will be prepared to meet the requirements and ensure that you are not held liable for fraudulent transactions.

Sources

http://www.cardfellow.com/blog/emv-smartcards-ready-or-not-here-they-come/ 
http://www.foxbusiness.com/personal-finance/2014/07/10/8-faqs-about-new-emv-credit-cards/ http://www.nilsonreport.com/publication_chart_and_graphs_archive.php 
http://www.smartcardalliance.org/publications-card-payments-roadmap-in-the-us/ 
http://myfw.com/2014/06/18/emv-changing-way-business/ 
https://www.javelinstrategy.com/brochure/314
http://www.cardhub.com/edu/credit-debit-card-fraud-statistics/