bad experience with credit card processing co....

Taking the inverse of this theme, are there merchants out there that people are using that are really good and that people would recommend?

Thanks,

-Chris

Unfortunately that sort of thing is common. Heck, if you start dealing with uncsrupulous customers and receive a lot of chargebacks, it's universal.

It's the dirty little secret of the industry… They claim that credit card interest rates are so high partially because of credit card fraud. That's a load of *** because it's not the CC companies that bear the burden. It's the merchants / resellers / businesses.

When a chargeback (refund) is initiated by the customer or owner of the credit card (due to actual or claimed fraud or improper charges), the money is not only recovered from the merchant for the refund, but they take the full amount of the charge. They don't take into account the 3% cut that was taken initially. On top of that, there is typically a penalty fee. Ultimately, in such cases, the merchant is not only out the product, but also out the penalties and fees. There is no appeal process. The only way out of being charged is to prove you refunded the customer by other means, which obviously is not the case if they're just trying to get your product for free.

When I ran my online business, I ended up switching to paypal and requiring customers to also be verified paypal accounts. This afforded me the paypal seller protections, but of course drastically reduced the number of people who could purchase from my site. The spontaneous sales were heavily reduced. But prior to that, I was reaching a point of losing money to unscrupulous buyers (people who bought the product, and then initiated a chargeback anyway).

I found one cc merchant acount named ECHO that has a very pro-merchant chargeback policy (compared to most merchant accounts).

I'm not a lawyer but maybe stating a warning like this might discourage a few chargebacks:

"Before issuing a chargeback for an order you never placed, please contact us for a refund. To help protect legitimate credit card holders that are victomized by credit card thieves, chargebacks issued without first contacting us may be investigated as potential fraud and may be reported to law enforcement officials along with the IP address used to place the original order."

Why not use 2checkout? Last time I checked their fees were reasonable and they're like the defacto merchant account provider.

We signed up with 2checkout, had a few payments through them, they said they paid us, bank never received anything…

We havn't used them since… enjoy.

ChrisB.

Whatever you do DONT use paypal.

They freeze accounts and keep the money for no

reason at all. They will also try to take money out of any account

you tell them about without your agreement.

See:

www.paypalsucks.com

www.paypalwarning.com

Yeah, it was only a breif time that I used paypal. :) ECHO sounds interesting. It's a shame there aren't more pro-merchant services out there.

@sednet:

Whatever you do DONT use paypal.

They freeze accounts and keep the money for no

reason at all. They will also try to take money out of any account

you tell them about without your agreement.

See:

www.paypalsucks.com

www.paypalwarning.com

I think many of the stories of accounts being frozen 'for no reason at all' might reveal the true reason upon investigation. I looked into a lot of the complaints about paypal and what I heard was this (what I heard might not be factual):

• paypal freezes accounts based on triggers. a trigger might be something like "if ip address of computer logging in is > 3,000 miles from historically typical ip address of this account, then freeze account until user can verify his/her identity"

If this were the case, someone going on a vacation/trip overseas could freeze his paypal account by logging on while in another country.

• customer gets pissed off and refuses to provide requested identification info to unlock the account, which simply makes the unfreezing process take longer than needed. one customer posted dozens of rants which I empathized with until I discovered by his own admission that he refused to provide more ID to unfreeze 'on principal'.

• some anti-paypal websites may have been owned and operated by paypal competitors. this is easy to investigate. things like this happen, like an SSL vendor spewing blatant disinformation about a competing certificate vendor (no, I won't name them since most of the disinfo has been removed now)

Having said this…

I think the problem with paypal was not having enough customer service (human beings) to deal with all the frozen accounts that were triggered automatically.

Do the math. A company with 30+ million active customers, in an industry with a high rate of fraud attempts, with tens of thousands of NEW accounts opening each day.

Even if 1 out of every 30,000 customer is pissed off (a disatisfaction rate most companies can only dream of achieving--ask caker what percentage of linode customers get pissed at him despite great service), that is still a HUGE number of people that can cry bloody murder on the internet--especially since it involves their MONEY.

When using paypal, maybe the best approach is to frequently transfer money out of the bank account associated/linked to the paypal account. Just leave enough in there to cover refunds/returns that could make your paypal account get a negative balance.

But most importantly, use at least 2 different vendors for accepting payment. If using paypal, then also use ECHO or TrustCommerce or etc. This will help you when one of them gets hit by DoS attack or technical problems.

@sarge:

• some anti-paypal websites may have been owned and operated by paypal competitors. this is easy to investigate. things like this happen, like an SSL vendor spewing blatant disinformation about a competing certificate vendor (no, I won't name them since most of the disinfo has been removed now)

Paypalwarning are running their own payment system so there may well be some truth in this. Paypalsucks appear to be totally independant though.

@sarge:

I think the problem with paypal was not having enough customer service (human beings) to deal with all the frozen accounts that were triggered automatically.

Thats part of the problem. They don't seem to care though. If there is even the smallest doubt they keep all the money in your account. If they don't think thats enough they take more from your credit card or current account without your permission.

Some people are not worth dealing with. I don't have anything to do with paypal or ebay anymore and my life is less complicated because of it.

I agree with you about the customer support.

But if ANYONE takes money from your credit card account WITHOUT your authorization, you can simply call your credit card co. and ask them to do a chargeback. This is a no-brainer 30-second task, and the burden of proof is then on whoever tried to take money (charge) your credit card (and it will take them a lot longer than 30 seconds).

Given the ease of chargebacks and the difficulty in getting them reversed, I doubt very seriously that paypal would take money from credit cards without proper authorization–otherwise, VISA/MASTERCARD/etc. would seriously hammer paypal with increased cc rates and hefty chargeback fees--it isn't as if they probably wouldn't enjoy doing that to paypal.

All of this suggests that whoever told you about paypal taking funds without authorization probably didn't bother reading the agreement granting paypal the autorization when they entered their bank account info. And they don't even have to enter their bank account info to have a paypal account.

Whats worse, I think their exaggerated/mischaracterized complaints take attention away from valid compliants like the slow customer support response. For example, I think anyone with a frozen account should be able to reach a live customer support person within 30 minutes for their first contact attempt and within 15 minutes for subsequent calls. There is no excuse for accounts to be frozen for more than a couple hours if the customer is available and willing to work with paypal to prove his/her identity (assuming account was frozen by an automatic fraud-detection trigger).

@sarge:

But if ANYONE takes money from your credit card account WITHOUT your authorization, you can simply call your credit card co. and ask them to do a chargeback. This is a no-brainer 30-second task, and the burden of proof is then on whoever tried to take money (charge) your credit card (and it will take them a lot longer than 30 seconds).

I'll bet 70% of people do just that. 30% won't even check the statement, or will dismiss it as something they must have brought and forgotten about.

I often get lines on my credit card bill I have chucked out the receipt for, and can't be totally sure they are right.

@sarge:

Given the ease of chargebacks and the difficulty in getting them reversed, I doubt very seriously that paypal would take money from credit cards without proper authorization–otherwise, VISA/MASTERCARD/etc. would seriously hammer paypal with increased cc rates and hefty chargeback fees--it isn't as if they probably wouldn't enjoy doing that to paypal.

Thats a totally reasonable point of view. And it's the point of view I had before I saw them do just that. I'm not talking from things I read on the web you know. They did that against someone I complained about due to the goods not turning up. And they tried doing that against me when someone lied ( and I can prove it ) about goods not turning up.

@sarge:

For example, I think anyone with a frozen account should be able to reach a live customer support person within 30 minutes for their first contact attempt and within 15 minutes for subsequent calls.

They don't answer the phone in 30 minutes. They don't even give you a phone number. It's not in any of their emails or on their website. They don't give you an email address to contact. If they want money ( for something thats not your fault ) they just spam you with demands and threats of legal action. Each email has a little note on the bottom that says replies will never be read by a human.

They really do seem to be as bad as all the stories.

@sednet:

@sarge:

They don't answer the phone in 30 minutes. They don't even give you a phone number. It's not in any of their emails or on their website. They don't give you an email address to contact. If they want money ( for something thats not your fault ) they just spam you with demands and threats of legal action. Each email has a little note on the bottom that says replies will never be read by a human.

They really do seem to be as bad as all the stories.

No opinion on whether or not PayPal really is evil, I have had no problems with them but I wouldn't be surprised if they are difficult. But your statements above are incorrect. A quick look through their web site (via the "Help" link on their front page) reveals:

> Customer Service Center

PayPal Customer Service Agents are available to help you during the following times:

4:00 AM PDT to 10:00 PM PDT Monday through Friday

6:00 AM PDT to 8:00 PM PDT on Saturday and Sunday

Call us at: 402-935-2050

Also they have a web fill-in form for sending email requests, not sure how reliable it is as I have never used it.

BTW I know a guy who made bank off of PayPal. He bought the domain name 'x.com' back in '95 or whenever it was they ICANN started allowing single-letter domain names to be sold. A few years later some guy offers $500,000 plus a bunch of stock for x.com and my friend took it. The stock ended up being in the company that became PayPal (was originally to be called 'x.com' and the fool who started the company paid big bucks for that domain name and didn't end up using it). Needless to say my friend (friend of a friend really) made out very well for himself, not bad for 5 minutes' work to purchase a domain name.

Back to the original thread, just wanted to say that after much discussion, we've reached an agreement with Total Merchant Services. The company agreed to refund some of the fees.

Personally I've used 2Checkout with some success. The prices aren't the cheapest but its reliable and also reasonable. This problem is precipitated by the fact that a lot of online sales (mine included) have very small prices which does cause problems with high fees.

if you're looking for a GOOD credit card processing experience, i've had nothing but good luck (after a bad paypal experience) since signing up with these guys for my credit card processing. they have a lot of good packages/setup options. it's been really easy so far.