The Uncertainties of a Merchant Account

Posted on August 6, 2013

More examples of the degree of uncertainty experienced by PayPal users: A person begins selling on eBay, sells an item and realises that the money takes 3 days or more to be transferred once the buyer receives the item.  Not a big deal, they think, but on paying for shipping costs they realise that the funds are not taken form their PayPal pending account where they should have the funds from the deal, but instead directly from their standard account, meaning they are immediately landed with a negative balance. They contact PayPal to try to make sure they can alleviate the negative balance by transferring money into it, and are assured that this will be done.  Instead however, they are simply charged again by PayPal.   So the customer now feels like they’ve been lied to directly, and robbed.  Next they contact customer service again and are ignored for days: at…

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The Chargeback Process and Your Online Business

Posted on August 6, 2013

It’s well known that a great number of chargeback processes are not actually the fault of online business, whether we’re talking about fraudulent transactions or failure to meet the obligations of the deal. Of course credit card companies are interested in keeping their customers happy, they want them to continue to use their card to make transactions online.  As such, most cases of alleged customer dissatisfaction usually result in a chargeback, with the funds being returned to the buyer and the seller losing out, whether they have been fraudulent, incompetent or otherwise. So there are significant dangers facing an online merchant where credit cards are concerned: on top of the obvious cost of losing an entire sale, sellers can incur penalty fees for chargebacks and have higher commission rates imposed on them when classified ‘risky’ accounts by the processing bank. However the terms, conditions and practices of major online payment…

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Online Payments: Pitfalls to Avoid

Posted on August 6, 2013

There’s no shortage of nightmare cases in the world of online payments: many come down to the fact that online sellers are forced into using one or two major online payment processors that simply don’t care for their business, with poor, impersonal customer service and arbitrary, unfair payment procedures. A few examples to illustrate: (1) An online seller deals in furniture and has been doing business without problems, all their customers have got what they paid for and they’ve only had positive feedback. One day, PayPal contacts them and demands to see a load of business documentation, saying that their account will be frozen until they supply it. The seller has to spend several weeks getting this information together, due to the fact that they have to contact all the courier companies they have used I order to obtain proof of delivery on every transaction, despite having only had positive…

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More Paypal Problems…

Posted on August 6, 2013

Your online funds can be seized on the spot, but it will take you an age to get a decent solution. Today’s top payment horror stories: (1) ‘Ironically, before this happened, I was a big fan of Paypal…’ PayPal freeze a seller’s account with more than $5000 dollars in it without warning, saying that they had carried out a routine check and taken issue with something they and found in the seller’s credit report.  The seller therefore could neither withdraw nor earn interest on the funds for 6 months. The seller has a 100% positive eBay account, with more than 100 sales successfully made and a number of repeat customers,  so it’s not as though there’s anything suspect about the seller’s account history in any way.  In fact the auction from which the money as made produced only positive feedback form all of the inning bidders/buyers involved. So the seller…

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Arbitrary PayPal Account Freezes and Poor Customer Service

Posted on August 6, 2013

A small company, recently established, chooses to take pre-orders.  But, PayPal doesn’t like the fact that the small company is receiving payments without delivering the item straight away, the account is frozen and this takes place just as the business is getting up and running, maybe taking more pre-orders on the new product that they have based their plans around launching. In order to unfreeze the account, the small business owner is told they must submit a huge raft of information establishing in depth the credentials of the business: invoices, proof of delivery, ‘business documentation’ and more.  The company owner then has a dreadful time in trying to submit the information, encountering technical errors and generally having a lot of their time wasted. Further to this, assuming the company succeeds in providing all the correct documentation required to verify it’s account, PayPal says it aims to respond within 14 days.  This is…

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Why More Sellers Are Looking For PayPal Alternatives

Posted on August 6, 2013

A common scenario for all those online sellers who are forced into using major payments companies like Paypal purely for lack of alternatives: A buyer decides to return an already used item but doesn’t feel like paying for return postage, so on the last day of their return period they establish a complaint procedure, and Paypal refunds them. The seller ends up with no item and no money. We see the same kind of process happen all the time with chargebacks and ‘unauthorized transaction’ claims, and this is why PayPal alternatives are becoming more and more sought after. No-one would tolerate the same situation in a real-world, offline monetary transaction, because the equivalent would be absurd: The buyer buys and uses an item, decides they don’t want it and demands that the seller come and collect it from them and give them a refund at the same time! The problem here…

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The Lowdown on Credit Card Services and Fees – What They DON’T Tell You

Posted on August 6, 2013

It’s time that somebody came forward and publicised how small businesses are paying (frankly insane) rates and credit card fees to credit card services to accept payments. You may think you know how much your small business is paying, but believe me, there are a lots of hidden charges and “twists” which they conceal from you in the small print. THE CARDS The Bank/Debit Card Don’t confuse this with a credit card. They both might say VISA or MasterCard on the front, but they are very different things. The bank card takes money out of your customer’s account and puts it into your account. It effectively amounts to a direct transfer. It also offers your customer no protection if you go bust or don’t deliver on your promises. It’s the cheapest card to accept, and in many cases, the fees are fixed irrespective of the amount transacted. Your money also…

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How FizzPay Can Help You: Secure Payment for Your Online Business

Posted on August 6, 2013

THE PROBLEM: Like I explained in a previous post, a supplier taking a credit card payment for any amount (whenever the card is not present), regardless of the payment processing service used, is effectively making a gamble that: the buyer is not going to mess him or her around on the transaction; the buyer is not using a stolen/fraudulent card; and the buyer is therefore not going to start a chargeback process (which results in the supplier not getting paid). In short these are not means of taking a secure payment for an online business.  The high risk this gamble entails means that today, suppliers are increasingly insisting on more transparent ways of getting their customers to pay for things (or they should be if they don’t want to lose money) – especially for larger transactions where they could potentially lose a large sum of money. And that’s fair. No…

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Problems with Accepting Credit Cards, Fraud, and Card-Not-Present Transactions

Posted on August 6, 2013

Quite simply, I hate taking credit cards in card-not-present transactions (any purchase where the cardholder is not present at the physical location of the point of sale – mail order purchases, phone purchases, Internet purchases etc.) Here’s why: Let’s say that you own a small but well-established company that supplies goods to customers all over your country and all over the world. Your website is your storefront. You operate in a small specialised niche, supplying higher value deliverable items, and are one of the very few known ports of call when it comes to supplying the goods that you are reasonably well known for. You ship everywhere, business is good and life is decent. Then one day, as is usual practice, someone in a different part of the world contacts you, does a deal, and gives you his credit card details. You charge the customer’s card, and you then ship…

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The Satisfaction of Cash

Posted on August 6, 2013

Following on from my first post about common sense, I thought it would be nice to elaborate on my feelings about the satisfaction relating to actually manifesting that common sense. In other words, the satisfaction that you get when you actually hand over the cash or transfer funds that your have to pay for an item in its entirety without credit cards and loans and overdrafts involved. If you’re anything like me, you’ll notice that there’s actually a great deal of satisfaction for paying for something in full, in its entirety, on the day you take delivery. The reason is that it then actually belongs to you. It does not belong to the bank. There is no balloon, no residual, no interest charges, and no dreaded monthly repayment. The transaction is complete – it’s yours and no-one can take it away from you. And if it’s something you really desired, that’s a…

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