## User Tag List

1. Does that 2% include the per txn flat processing fees? 25 cents on a \$50 charge is 0.5%.

2. The 2% is the discount rate. And then there is a transaction fee as well. Usually \$0.25-\$0.35 cents per transaction. So if you did have a 2% discount rate & a \$0.25 transaction fee, the amount for \$50.00 is \$1.25.

aieoncfo - I'll still be more than happy to help you out if you would allow me to. Even though I am not your agent - I will still do my best to find out the answers for you.

Thanks!

3. Right. I was just reinforcing that it's really important to take into account all of the fees you get charged as well as your average charge amounts when comparing rates.

4. Make sure you take any fees offered to you and you apply them to your business. Take your average ticket and monthly volume and do some homework!

Here's a good example of doing your homework:

I had a potential new customer call me wanting to know more about our services. I asked her about her business, basic summary is she has an average ticket of \$4000. She is currently shopping around as well. I told her about our plan and at first she balked. I asked why and she said we had a transaction fee was 24¢ more then a competitor's. So naturally I asked what their percentage was. She said the difference in rates wasn't a big deal (.31%). I said it was! Now let's do some math:

\$4000 x .31% = \$1.24 - .24¢ trans fee = \$1.00

Now multiply \$1 times how many transactions she will do over time and you can see how it adds up.

What's the moral of the story? Do the math! If people shopped around for credit card processing like they do cars and homes they would save themselves a ton of money. Even 10¢ saved per transaction adds up to a lot of money. If it didn't every processor would offer you bargain rates!

If all of my posts do nothing else, let them encourage all of you to do your homework when trying to set up a merchant account. PLEASE shop around and do the math!!!

5. Not that I am disagreeing with you Stymiee but pricing isn't the only thing that needs to be considered. I would gladly forgo \$1-00 on a \$4000 ticket in exchange for working with a company I felt happy and comfortable with. The number one issue for me would be that I could talk to them on a personal level if I needed to and know that I wouldn't get stonewalled, fobbed off or just blinded with technicalities if I had a problem.

Graham

6. Corey Bryant maybe you can help.

Here is the situtation:

Around 3 weeks ago, one of our employees took an order. From first looks at it, I could see why, nothing to the untrained eye looked fradulent about it. However, because we are a computer company, we can't afford to have \$2,000 chargebacks so we have someone else always do their due dilligence on the order before we decide to process it. In this case, the person who did made the transction knew alot about how AVS systems work... If you do not know, most of the time you type in the wrong Address when you fill out the billing informaton online. Your avs code would say something to the affect of "NYZM" which means the address does not match but the zip code does, and the security pin number is correct as well. This persons code was "NYZN" which means he did not have the card. We decdied to for better or for worse it should be refunded.

Here is where the fun begins. We simply refunded the order and normally they take whatever you refund out of your next batch, and considering it was a refund for \$1,575 and we had \$2,200 in transfer we should only see \$700 right? WRONG. They actually let the funds post to our account.

Where it gets complicated is that same day, we had put in a request to change our bank account on file, so when the \$1,575 showed up, we took it out of the account and put it in the new account so that it could be refunded back once it posts... They charged the old account, so the next day we had a negitive balance in the account. Before the charge actually posted I went to the bank and had the bank transfer the \$1,575 back to the account it was supposed to come out of. To show my luck, the person who was supposed to tranfer the money was new, made a mistake and it didn't show up the next day (it was cash, supposed to be instant).

Now my account was on hold, and I could understand that, I mean we did owe them money. So I had the bank call and leave a message saying that it was a mistake on the banks part, and to charge our bank account again the next day and the funds would be available.

Of course, they didn't, I had to call CardServerice, and when they actually did try to collect on the charge again it went though on December 22nd and you would figure that my account should be off of hold.

Wrong again. Until December 29th, they swore that they didn't have the money that was transfered from my account. Turns out a lost provention representive took the money out of my account when he was not supposed to; it's not his job, the Collections department is supposed to do that, but that's not my fault now is it? You would think "hey, it's your company regardless of what department, work it out". They would literly yell at me saying "You need to call this deptartment because we have nothing to do with this".

By this time we had to slow down marketing because our account was still on hold, but we still had \$4,300 that was owed to us. Finally, it turns out that not only did I get \$1,575 debited to my account; to get my account off hold I would have to pay an additional \$1,865.39 PLUS the \$1,575 again because and I quote "the \$1,575 charge is going to be rejected, and it will show up in your account in a matter of days". I said if you are sure go ahead. I even had our corperate banker on the phone and she told him the exact same thing. We did recieve the balance of \$996.00 but of course the charge for \$1,575 still didn't post to my account. So what this means is that now I was charged twice for the same amount; one time when the funds were debited out of my account, and again once they took the money out of the funds in transfer.

Needless to say I was not happy. This woman flat out lied to me AND my corperate banker.

I called them monday and they informed me that the they actually did see the funds, but can't give them to me because my account is on BanControl, because of an order we took was made with an International Credit Card. We would have caught it, but they did first, I told them to just go ahead and refund the funds...

To make matters worse, the refund posted to their account today, but we recieved our first chargeback today, although it was for our smallest order. Even with that however, they took the money out of my bank account...When they have \$3,000 of mine sitting at their company. My account has been on hold for the last 3 or so weeks, they have all of our money.

The sad thing is, it wouldn't be soo bad if the people where helpful. I spend literaly 4-5 hours A DAY on the phone with them, hell I am on hold now. All they do is fingerpoint and say I need to talk to so and so's department. No one ever picks up their phone. I called 4 people there yesterday all day and not one of them picked up their phone the entire day. Not the first time either.

It's not my fault that the worng department debited my account, it's yours. Fix it. Plain and simple. We have had to in essence, pause marketing. I don't know how we have been able to keep any resemblence of a normal business while this is happening.

Then they tell me "you have alot of activity on my account". Keep in mind that my account has been on hold for the last 3 weeks... I have accecpt payments I think 4 times over the last 3 weeks, given 1 refund and had a chargeback this morning... I don't think that's essissive... So anything else that they see was done by their employees.

What they are doing is borderline fraud. Anything over \$1,500 dollars is fraud. For starters, even if I were to Close my account, they charged me twice for something, It doesn't matter if my account is on hold or not, they owe me that money. Secondly, yes we give refunds when we think it's necessary but we have been up for 3 months now and have had 1 refund... And the only reason she filed a complaint was because she didn't like how long our refund process takes (we are a non-profit company, have to take extra measures). Anyone who looks at the corresponding information can easily see we are trying to work with her, she is impatient.
But isn't the point NOT TO HAVE CHARGEBACKS? So they would rather me keep orders that I believe fradulent than give refunds? Of course not, but something has to give.

One thing that was wrong in the beginning was that the person we hired to program our site took the easy route; all of our charges posted as soon as they were accecpted, we didn' thave a choice of accecpting or denying it. We just figured out, around 2 weeks ago, that you could accecpt or deny an order. But even the instructions he used to do that were in the tuturioal; if they didn't want you to accecpt items as soon as an order was made, why in the hell would you give me instructions on showing how to do so.

Right now we have \$3,450 being held by their company, and have probably lost another \$20,000 due to not being able to market. This is on hold for a charge that they have already recieved a refund for and a chargeback that came in today for \$499.00... Something they could have easily taken out of the the withheld transfer.

Needless to say, I am searching for new merchants as we speak. I have spent well over 50 hours this past month dealing with this company. We were using paysystems before this, and I think I had to call them one time and the call didn't last more than 10 mins.

My store number is 843214.

I have spoken to the following people:

Mary in the collections deptment
Patrick in the collections deptartment (actually pretty helpful; but never there)
Theressa in the Loss prevention depatment (actually a sweet woman, but for some reason they took her off of our account)
Shawn Vargas in the Loss prevention dartment
Martin Hernandez in the Loss prevention Department

I have spoken with more, but these are the people who are actually working on my account on a constant basis. What gets me if we just took 10 mins and got on conference call, this would be taken care of.

7. "What they are doing is borderline fraud. Anything over \$1,500 dollars is fraud. For starters, even if I were to Close my account, they charged me twice for something, It doesn't matter if my account is on hold or not, they owe me that money. Secondly, yes we give refunds when we think it's necessary but we have been up for 3 months now and have had 1 refund... And the only reason she filed a complaint was because she didn't like how long our refund process takes (we are a non-profit company, have to take extra measures). Anyone who looks at the corresponding information can easily see we are trying to work with her, she is impatient.
But isn't the point NOT TO HAVE CHARGEBACKS? So they would rather me keep orders that I believe fradulent than give refunds? Of course not, but something has to give."

I ment to say we have only had one chargeback

8. Who was your sales rep as well. They should be on this call. I will say that the bigger the company gets - the more problems it does have.

When it was owned by Chuck & more of a family-type business, it was great. When Chuck had to sell the remaining control over to First Data - that was when things got a little out of order. Most of the "family" is now gone.

You should contact your sales rep & get him in on this immediately. One - he would not want to see you leave because he would lose that business. A lot of people think that once the deal is closed - they no longer need the sales rep - which is totally incorrect. I e-mail every one of my clients every 6 weeks at least to check in & to make sure they are not having any problems.

I did talk to a few people the other day about your problem (I just thought maybe you were venting because I had not heard from you). They also said to get the sales agent involved. I tired to - but they frowned on me trying to help another agent's merchant because it is illegal for me to come to you & say I can get you a better deal at CSI. Even though that is not what I am doing - they look at it like I am trying to take over your account.

I actually did call a few people but they kept telling me to contact the main sales rep. It is a very sticky situation you have there & I was afraid that if I kept going up the ladder I would make it worse. Do you remember who your sales rep was?

9. I am not the person who signed the account up, I think I might be able to find out.

I appricate your help, right now I am going to the bank to have our corperate banker fax them; remember they charged us twice for something that didn't happen.

Also, I know that CardService uses Wells Fargo as their primary bank. I plan to give them a call later today and see what I can get done.

I will see if I can get the name for you in a couple of hours. Would I have recieved an email from my sales rep?

10. What gets me is last month, even WITH our account being on hold for half of the month, we brought them \$1,000 in profit. For Basically doing nothing. You would think that they would be a little mindful of that.

11. You should have. I mean everyone does everything differently. We e-mail & call them. Give them a voice @ least to put with us. And I make sure that if they have any problems with anything - to let me know.

We had an issue a couple of weeks ago - one of my clients did actually. And I took the proper channels until one of the reps irked me... So I asked him what facility he was in (since some of the calls are now routed to First Data). I hung up & turned to my roommate who is actually the Director of IT for First Data Merchant Services or something like that... And made him take care of it. (or else his life would be miserable for the remainder of the weekend )

And they are but if that bank account was shut down - that tends to freak them out. A merchant was doing that a few year ago actually. Would get a lot of chargebacks - be shut off - open up a new account, new name etc. It is important to keep your sales rep informed & Loss Prevention if something is going to happen. That way - they have a heads up & it prevents a much bigger fiasco.

12. We didn't shut down the account, it's open as we speak. The thing is, the only thing at the time we were using the account for at the time was for tranfers from Cardservice to come in, which ment an unnecessary trip to the bank everyday for me to transfer funds (Two different company names, can't do it online).

I remember I was talking to Mary in collections one day, and she kept telling me " This is a code 113, we can't do this". I was like, mam, with all due respect, I don't get paid to know what your codes mean, all I know is that you charged me twice. I don't expect you to know what our codes at our job are."

13. Originally Posted by Corey Bryant
Well he was processing about \$100,000 a night.
Well, that is definitely large.

14. Here is where we currently stand...

They are currently holding \$3,340 of our funds. Becuase they have been holding our working capital, we cannot ship out any orders (yes it has gotten that bad). We got our first chargeback today, with 2 more on the way. Now if you add the 3 chargebacks up and subtract them from \$3,340, we would have approx. \$600 dollars left over. The only thing is that they won't take the chargebacks out of the withheld funds.

So what in the world are we supposed to do? We said the hell with it, it's only a \$600 dollar difference, we have implimented a contengency plan and are in the process of going with our backup merchants.

15. Interesting. Very good, but some of those fees are charged by the biggest processors!

Not that I am disagreeing with you Stymiee but pricing isn't the only thing that needs to be considered. I would gladly forgo \$1-00 on a \$4000 ticket in exchange for working with a company I felt happy and comfortable with. The number one issue for me would be that I could talk to them on a personal level if I needed to and know that I wouldn't get stonewalled, fobbed off or just blinded with technicalities if I had a problem.

Graham
\$1 per transaction is huge for any merchant processing more then a dozen transactions per month regardless of the size of ticket. And of course pricing isn;t the only thing to be considered, but I see some of the companies people are choosing and I know they don't provide the kind of customer service that justifies paying 50% or more then if they had shopped around.

17. aieoncfo - did you find out who your sales agent was. A lot of sales agents do not keep in contact with their merchants afterwards. This is true with most all companies. I actually had lunch today with one of our clients that signed up a year ago. She has been very pleased with everything.

Sorry I meant that bank change. Do you know what day this happened on? Roommate gets home later - I will try to get him to look @ a few things either here @ home or when he gets into the office

18. You can go lower than 2%, but not much. Interchange cost is just below 2%, but it will not turn into enough unless you process millions.

However, why would you want to offer service for that cheap of a price? I have a client that does over \$300K a month and he is paying 2.17%. How did I sell it? Well, he was looking for service! He wanted certain special features and we delivered, plus he liked the fact that he has access to the executive team. Lastly, I would not want to take on the risk of an Internet account for that low of a price. Possibly IF and only if they are a company that deals with the government strictly.

Regarding Echo, there are a few things I didn't like. They don't do direct deposit of the funds, and they are the only company that I know of that does this. You have to write out a check and they hit you up for more fees if you write more than 10 per month. The other thing I didn't like is they hide their stuff in a way it is very confusing for merchants. They say our transaction fee is this (on the app), which may seem very low, but then below that, they have all the data and list a 10 cent interchange cost, which you have to add to the transaction, which most merchants don't have a clue at what they are looking at and will not know that.

Thanks
Curtis

19. Regarding stymiee's first message, I skimmed over it, but I wanted to say one thing.

Regarding the deposit of the funds, some companies do it in 5 days and it isn't because they are making interest, they could care less about that as it is so little. What is of concern to them is fraudulent transactions. That gives their risk & fraud department some extra time to investigate the transactions if need to be before just handing over the funds and with card not present transactions, fraud is a lot higher.

Do know that processors loose BILLIONS each year on fraudulent transactions. Society may think the bank that issues the card (issuing bank) is losing money here and they never do. The merchant or their processor (provider in most cases) is the one that always pays.

You need to realize that many of the things that companies do is to lower their risk as this business is very risky and if you are not careful, will drown yourself. I know of one provider that lost 250K on one hosting company that went out of biz and it would have been over a million, but they found someone to buy the company out instead, so it cost them 250K instead.

Curtis

20. It shouldn't take 5 days unless the processor explicitly tells the customer that they are a high risk merchant and they need to do this because f the potential for fraud. Otherwise it should never take more then a couple of days. Five is unecessarily long for the average merchant.

21. Who sets this standard? Have you ever worked in the risk & fraud department? For most companies 3 days is enough, but many merchants 5 is required, such as high ticket items, etc. Most people do not have excellent credit, so I can understand why. A few days isn't going to hurt them, they shouldn't be runing on the low of cash flow anyhow, not to affect them within a day or two.

The merchant must give and take, same as the provider.

Curtis

22. As long as the provider informs the merchant of the delay then it's cool. But then it should only be for very high risk merchants such as large ticket electronics over the Internet. Just being an Internet merchant, alothough riskier then a brick and mortor store, should not see a funding delay. As a rule, funding shouldn't take more then two business days.

23. Well, even your biggest providers take longer than 2 days! I see 3 to 5 more of the standard. Take TMS, I think that is what they offer. Big deal, a day or two, who cares. They shouldn't be concerned about that, but about SALES. Without it, you have nothing!

24. Originally Posted by Curtis Stevens
Well, even your biggest providers take longer than 2 days! I see 3 to 5 more of the standard. Take TMS, I think that is what they offer. Big deal, a day or two, who cares.
Who cares? The merchant. I speak to about 20 ner merchants everyday and how quickly they get their funds is one of the most important topics. Not too few businesses need their funds ASAP so they can replenish their inventory as they run a very tight ship.

Originally Posted by Curtis Stevens
They shouldn't be concerned about that, but about SALES. Without it, you have nothing!
100% absolutely true. Well, the sales part anyway.

25. If they are the size of Dell, then yes I can see how a day or two can hurt. If they have inventory, are you going to tell me that they have their inventory turn over rate down to a day or two as they are constantly buying new merchandise every day, to require the money? They already have the money tied up in inventory, just think of it as they haven't sold it yet, they sold it though, now a few days will not hurt as if they didn't even sale that particular product to that customer, they would be waiting much longer anyways. What I'm trying to say is even before the sale, they their money is tied up in the inventory, and if their average turnover rate is 30 days, then 3 or 4 days funding will not matter as they are already waiting 30 days to turn over their inventory, which they should have much tighter controls on it - shorter time periods. This gets too deep into the accounting financial standpoints of how a business operates. It is a big deal to most as they do not have the knowledge in these two areas to fully understand the big picture.

Curtis

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