Why Customer Service Is Important For Merchant Account Holders

Customer service probably isn’t the first thing you think about when you’re trying to consider credit card processing services offering competitive rates. You’re usually thinking about the costs to your business, so you can control overhead. That’s not the wrong approach, but don’t just dive into an account with great rates. What they lack in fees, they may make up for in poor customer service. You don’t want to be stuck on Black Friday with a register that won’t boot up and no cause to request help.

First Point of Contact

When you’re searching for a payment gateway, you need to speak with customer service to ask some basic questions. Depending on how easy it is to get someone on the phone, you should have a good indication of the quality of customer service. Talk to the representative and see what kind of knowledge he or she has on hand. Good customer service will give you the answers you need, without jostling you from one department to the next.


Whether you operate a high risk merchant account, or a standard business with typical rates, you’re going to require setup and maintenance assistance. Modern payment systems rely on the Internet within your store to help you transmit payment information. If your system is non-responsive, and you’ve confirmed your Internet service is active, customer support will be your safety net. Make sure you’re not being charged for instructions on how to reboot your system.

Final Thoughts

Based on their response time, you should be able to form a solid picture of what kind of service to expect. Customer service is very important to merchant account holders, so make sure your representatives are accessible.

For 6 years running, Payment Solutions, Inc. has been voted the number one merchant account provider offering low fees and current hardware.

The Pros and Cons to a Cash-Only Business

By Phineas Upham

If you’re looking to open a retail business, you might be wondering whether you’ll need a merchant account or if you can get by as cash only. The good news is cash is the most common form of tender, and it’s only up until recently that the idea of a cash-only business has started to fade. Here, we’ll discuss the pros and cons of a cash-only business.


If you run a cash-only business, you can only accept cash. What happens when a customer doesn’t have enough cash on hand? In addition to the potential for lost customers, your business becomes a target for theft when it’s known you keep large sums of cash on hand. You’re also not exempt from tax forms either. You’ll need to complete form 8300 if you receive more than $10,000 in cash from one buyer.


A business that runs on cash stays funded. It takes time for funds to clear, so running a business on cash helps eliminate a waiting period that can hurt smaller businesses with low liquidity. Cash also involves less bookkeeping since it’s a simple tender, which means businesses save money on hiring bookkeepers or keeping accountants.

Accepting only cash also dramatically reduces the chances a business can be defrauded. It’s still possible to commit cash fraud, but it’s far less common than say check or debit card fraud.

Choosing the Best Option

Ultimately, it’s up to you which choice is yours. Some businesses find it easier to start as cash-only establishments and eventually switch to merchant accounts. Others may find the legitimacy of a merchant account essential to their brand. Either type of business is viable.

Phineas Upham is an investor from NYC and SF. You may contact Phin on his Phineas Upham website or Facebook page.

Every Business with a Merchant Account Needs to Know About This Fee

Every-Business-with-a-Merchant-Account-Needs-to-Know-About-This-FeeMerchant accounts have two fairly common pricing tiers consisting of three and six-tiered pricing. This is by design, of course, because these are the easiest pricing tiers to explain to potential buyers. All fees present some form of risk to the merchant, but chargebacks present the greatest potential risk to banks and providers so merchants tend to feel the brunt of these the most.

Chargebacks and Refunds

There is a major difference between a chargeback and a refund. Refunds are mutual because the merchant agrees to take the purchase back and refund the buyer the money they’d spent. Refunds can include re-stocking fees as well. Chargebacks are initiated by the user and carried out between the user and the bank.

The provider can potentially be exposed to millions of dollars in unpaid debt if the merchants the provider deals with are unscrupulous. If the merchant fails to pay those costs, for whatever reason, the cardholder must pay to make the deal right.

Therefore, most merchant companies will take that risk into account when they underwrite the contract. There may be in-depth assessments of a merchant’s potential risk on the bank’s part, which is all a normal part of the process.

Some banks may also impose limits on the amount a merchant is able to charge back to a buyer. Failure to stay within these limits can lead to fines or strict regulations on the merchant’s account. That’s in addition to the chargeback fee that accompanies these transactions.

Bio: Firoz Patel is a passionate marketer and technology enthusiast who founded AlertPay Inc. in 2005. Currently, Firoz Patel lives in Quebec and oversees development of the Payza platform.

8 steps to fighting chargeback fraud

ChargebackScams-810x323Credit card chargeback fraud is a persistent problem for merchants and can be hard to detect. But there are ways small-business owners can fight back.

Fraudulent chargebacks include cases of identity theft and so-called “friendly fraud,” in which a customer deceptively says a product or service was never ordered or was not delivered. Friendly fraud accounts for 18 percent of all merchants’ fraud cases, according to the 2014 LexisNexis True Cost of Fraud Study.
Usually, you won’t hear from the customer if they’re committing friendly fraud, says John Monarch, CEO of Direct Outbound, a Greenville, South Carolina, call center firm that provides chargeback dispute services. Many customers go straight to their card issuer as a matter of convenience, whether their chargeback is a result of someone misusing their credit card, friendly fraud, or even incorrect chargebacks that are a result of not recognizing the purchase. A 2014 survey by Trustev found that 17 percent of U.S. consumers have disputed charges without contacting an online merchant, and 7 percent admitted to lying about the condition of a product so they could return it for a refund.

If chargeback fraud goes unchecked, the consequences can be severe. Too many chargebacks could prompt your acquiring bank to terminate your account. That could make it almost impossible to get a new account, according to Tim Russo, fraud prevention team leader at cleverbridge, an e-commerce technology firm in Chicago.

Russo says card associations use a database known as MATCH, which stands for Member Alert to Control High-Risk Merchants (previously known as the Terminated Merchant File, or TMF). The system is used by MasterCard and Visa processing banks to identify merchants that have had their accounts terminated. Once a merchant is on this list it is highly unlikely that future merchant account applications will be approved. “The TMF, or MATCH list, is essentially a blacklist from which it is almost impossible to be removed,” says Russo.

Determining whether your business has a chargeback fraud problem can be tricky. However, there are several important signs that fraud is an issue, as well as some smart ways to prevent it — or, at least, fight it when it happens.

1. Understand your risk. Merchants who do business online are at particular risk of chargeback fraud because they are not able to see the credit card being used or check a customer’s identification or signature, says Monarch. As a result, it can be easier for fraudsters to use stolen credentials to order merchandise online. In addition, because the merchandise is often shipped without a signature required for delivery, it can be easier for friendly fraud perpetrators to claim the product was never received.

The problem is growing, too. The LexisNexis study found that 51 percent of the fraud experienced by merchants who accept online transactions comes from the online channel, compared to 42 percent in 2013.

Knowing that you’re more vulnerable to risk gives you an indication that you need to be more vigilant about verifying what you can and tracking fraud overall, Monarch says.

2. Flag verification issues. Erik Van Riper, founder of Build the Store, a San Fernando, California, online business that builds e-commerce platforms for other companies, says preventing fraud requires using all possible verification components when fulfilling a transaction. If the card is present, ask for identification. If it’s not, you need to take other measures.

“One thing that we insist on for any credit card transaction is that the billing address matches the credit card billing address. The shipping address can be different, but we insist that at least the knowledge of the billing address is there, and correct,” he says. If the purchaser can’t provide this verification, the transaction is not approved.

3. Look for unusual activity. From there, Van Riper recommends monitoring transactions for unusual activity, such as orders for high volumes of product or for many expensive items of the same type or brand. Review the location of the transaction. If the billing address is in New York and the customer is shipping to a place in Oregon, you may wish to further verify the transaction by contacting the customer. Set a threshold — say, $100 — and require a signature on the package for any shipment valued at more than that amount, he recommends.

4. Examine notification codes. When you receive a chargeback, it will have a reason code. Each code, which varies by card network, will indicate the reason for the chargeback, such as “counterfeit magnetic stripe” or “fraud, card not present environment.” Once you have the code, investigate the transaction to spot irregularities, says Russo. Were there missed indicators that this was a fraudulent transaction?

5. Review nonfraud chargebacks and declines. Don’t just scan your reason codes for fraud. Investigate other reason codes and your decline rates, Russo says.

High decline rates may signal a problem with attempted fraud. But some codes might indicate customers don’t recognize their transactions, he says. If you see those codes regularly, it could mean you need to work with your credit card processing company to clarify the descriptor that appears on customers’ credit card statements. It’s also a good idea to include a telephone number on the descriptor, if possible, so customers can easily contact you if they have questions about charges.

The bottom line is to track the reasons for your chargebacks and try to take steps to remedy them. If you’re not tracking this data, you could have a problem before you even know it. “Tracking customers that have charged back is usually a good idea, because if it was a case of ‘friendly fraud’ there’s the chance that it will be done again,” Monarch says.

6. Make your case. If a chargeback has been filed, the bank will ask for all records you have verifying that the order is real. Be sure to provide those in a timely manner, Monarch says. They may include terminal records, signatures and any other information available for in-person transactions. Online transaction backup may include address verification and CVV verification, IP address information that coordinates with the purchaser’s address, and product delivery records with delivery confirmation showing the customer received the package.

The TMF, or MATCH list, is essentially a blacklist from which it is almost impossible to be removed.

— Tim Russo
Fraud prevention team leader, cleverbridge

Monarch says it’s usually not helpful to try to contact the customer if they have already initiated a chargeback. “The chargeback is on record against you at this point,” he explains. “Even if you win and get your money back, it still counts against your merchant account for the month.

“The best plan of attack, if it’s already filed, is to simply gather as much data as possible, write up a detailed document regarding how one purchases your product or service, and submit all of this to the acquiring bank, which will have mailed or faxed you a chargeback letter,” he says.

7. Get your data. At MasterCard, the central repository for fraud data is the System to Avoid Fraud Effectively (SAFE), which supports fraud prevention programs and security efforts, Russo says. All MasterCard issuers are required to report fraudulent transactions to SAFE at least monthly. SAFE then generates reports for both issuers and acquirers and provides data for other security and risk management programs, as well as merchant audit programs.

Your credit card processing company likely has access to this data, Russo says. Asking your processor for as much of that information as possible may be helpful if you have a series of fraudulent transactions of less than $30 (the threshold at which you are typically notified) that are caught before they get to you. He admits it can be hard to get a full accounting of this type of activity, but the more volume you do and the better relationship you build with your processor, the more likely it is to help you.

8. Work with your processor. Russo, who has previously been employed by two processing companies, says these firms may have additional resources to help you combat fraud, such as suggestions for enhancing security and advice on how to better verify transactions. Stay in touch with your processing company to ensure that you’re adopting the latest and best practices to prevent fraudulent transactions, he says.

Spotting chargeback fraud can be tricky, but by knowing where to look and using that information to improve your operations, you can stave off losses. It’s not a one-and-done activity, though. Small businesses must be vigilant to minimize chargeback fraud on an ongoing basis.

Accept credit card payments in real-time

Written by SecureNetShop

When it comes to starting your online store or accepting payments via your website, setting up a shopping cart system might be an easy task. The method has changed from the use of offline machines that would be charging for online transactions and has been made simpler because of credit card processing services.

Basically, the service would cater for all the work required on the bank end and would look after the security of the transaction and handle other issues that might crop up. These services partner with banks and other alternative payment services directly. Companies offering these credit card processing services often charge a small processing fee which could be monthly or represent a percentage of your transaction depending on the company and credit card service.

The attributes that you could be looking for in a credit card processing service are numerous. An important aspect is ease of use. It would be beneficial as you would not have to train your staff to understand your ecommerce cart software. Security is another important aspect to consider as this will reassure your customers and yourself regarding your online shopping cart.

Customer service is another important factor to look at. You would not want to be in a tough situation and have no solution to your issue, especially since transactions are often time-sensitive. Moreover, you might consider whether the service is reliable and delivers consistency.

SecureNetShop offers its customers with shopping cart systems for their online stores. The functionalities are simple and user-friendly.

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