Hold on Money by Merchant Account Processor

[cabos]

Have been using the same processor for 4 years now. In all this time have only had 1 chargeback.

This past month sales volume almost doubled and the processor has put a hold on all the money saying that we werent approved to run this much business.

Seems like an excuse for them to be able to earn more interest.

Now they are reviewing the account to determine whether to increase the volume allowed though in the meantime are holding on to all the money.

Anyone else experienced a similar problem? Any advice on the best way to handle this?

[PCInk]

Step 1: Write them a seven day payment demand letter otherwise you will take legal action. You cannot hold payments back to your suppliers, webhosts etc... They still need to be paid on time. A settlement of the maximum amount agreed per month would be the minimum I would request. Outstanding amounts that are overdue should be invoiced with interest added. Make it clear that this will happen in the letter.

Step 2: Get prices from competitors and request a discount on your rates due for this new large sales volumes you are now providing with them.

They don't want a legal dispute and they don't want to pay interest. They will likely sort out the problem within the seven days.

[moose606]

We had this problem a few years ago, and could not process any more credit cards. We called them and they were more than happy to increase our monthly limits. We use a service available to Costco Business members, which has a good rate, and so far few problems. Maybe it's time to do a little shopping?

[cabos]

Thanks......for the great advice.

Started shopping for new provider and will write the letter.

[Corey Bryant]

One thing also to keep in mind, keep in contact with your sales agent. If you think that you are going above what you told your processor, let him/her know so they can talk to the correct people. This is very important. Keep the lines open & you should not have a problem.

It scares some processors because it brings up red flags when all of a sudden you start to sell more.

-Corey