TFW Members: Online Documentation - Credit Cards: Caution

Why proceed with caution?

Bad Enough: This is an expensive way to collect money. The credit card companies take a big bite before you get anything.

Worse: Disgruntled or irresponsible customers can cost you far more than they ever bought from you.

We sell credit card services (merchant services). Over the years our customers have introduced us to many different processors. We've lived through the good and the bad.

Great rates are easy. We've always offered great rates.

Honesty is harder to find. Accountability is even harder.

If you get all that (great rates, honesty, accountability), your merchant account can still explode your business. Not your sales. Your business. Not an explosion like fireworks, or a celebration. An explosion that leaves everything you've built in ashes at your feet.

If enough dishonest customers turn against you, your card services company may turn against you too. Then all bets are off.

Contact us for some United Bank Card horror stories, for example. We no longer use United Bank Card, but who can be sure other companies would not do likewise?

Over time, our community has found and proven the best card services.

Accountability: What's accountability? The way a credit card processor makes its honesty easy to see, and its dishonesty difficult to hide.

In the world of credit cards (merchant services), finding accountability takes time.

Credit card processing is one of our glories. We have a built-in credit card terminal that gets high-speed approvals over the Internet. When you're on the move, it holds transactions until you get back within Internet range.

In truth, many of our best customers don't take credit cards at all. Would that work for you?

Sneaky Fees. Sneaky fees are the least of your problems. Yes, they nickel-and-dime you, some of these credit card services. Repeat fees are worse than one-time charges.

An example of a one-time charge: a primitive imprinter plate or "knuckle-buster" that no one uses anymore, not for decades.

An example of a repeat charge: a new version of their online reporting service. If you don't look through the announcement closely, you won't notice the new fee. If you complain later, you're told that you, like everyone else, received a letter announcing the offer. Since you didn't say No in time, you agreed to the purchase.

Credit card services aren't the only offenders (cell phone services do some of this).

Disgruntled Customers. You also have customer honesty to worry about. Suppose a few of your customers take back their credit card payments (for whatever reason, good or bad). Some card services take the money from your account before they talk to you (shoot first, talk later).

You'll spend hours sending documentation to your card processor. Like a tax audit, you can't just say 'Thanks, but nevermind.'

In most cases your effort is wasted, and the money is gone anyhow.

Massive Raid. Disgruntled customers can't take back more than they have given you. But at any point, your card service may raid your company bank account for amounts that dwarf anything your customers paid you.

If enough unhappy (or less-than-honorable) customers bypass you and take back their payments, your card processor can extract a large sum from your bank account without notice. They decide whether, when, and how much. They call it a deposit (reserve) to cover refunds your customers might take in future.

You can't do much to get that money back. If you cancel your account with them, they still keep your "deposit" for months or years. They may raid your bank account again for a cancellation (termination) fee.

You can feel mugged from both directions, by your customers and by your card service. We see this happen to plenty of good people.

If you take credit cards from your customers, proceed with caution. Choose the card service with care.

Only offer the credit card option to a customer you can trust. Then take good care of that customer.