Are 3rd party processing accounts viable?

.. are we going to be left holding the bag?

[blaze]

Considering the recent chaos and disarray a certain 3rd party processor has thrown a lot of independent webmasters into, I was wondering what everyone's take on the future of 3rd party processors was.

Do you think that if you are signed up with a 3rd party processor currently that you have a chance of being left holding the bag as others currently are?

My thoughts are that the cartel definitely has an interest in keeping 3rd party CC processing accounts from being successful.

3rd party CC gateways do commoditize the backend CC suppliers somewhat.

For example, PayPal is developing a whole new payment system because they are allowed to be a 3rd party CC processor.

As a merchant using PayPal, you do not even have to really care about who you accept as long as you are converting at a reasonable rate.

Could the recent activities with 3rd Party Processors be a warning shot over PayPal's bow? Could your favorite small fry 3rd Party processor be the next warning shot - leaving you holding the bag waiting for your funds to be released?

BTW, let's avoid naming names, otherwise we create a legal headache for our good buddies at WebmasterWorld.

[derekwong28]

Well, this is what one third party processor is using to defend itself against posible action by Visa/Mastercard.

They said that what had happened will not occur with them, as they are a reseller and not a third party card processor. It claims that it acts as a reseller of your products/ services, allowing customers to make purchases via their Credit Cards (much like a Department Store sells products produced by thousands of manufacturers).

Do you think this is defensible given that nobody can purchase stuff directly from their web site?

[OlRedEye]

Hi
As somebody desperately searching for a lowish-cost solution at the moment with extremely little joy, I am intensely interested in this subject. Your post though is unclear to me, maybe because you are trying to avoid too much detail for understandable reasons. Maybe a little clarification for newbies like me?
I just tried to sign up with another, and all details were captured on a non-secure server, including banking, passwords etc. I promptly recieved a nice open e-mail reflecting those details including the answer to the 'secret' question to obtain access to the accounts password. Needless to say they are not a proposition. Having been bitten twice already in a very short period of time I feel that we have an obligation to pass on information openly about problems (naming operators) if the facts are true in order to help others. This in view of the depressing state of this industry.

[blaze]

Yah, it's very depressing indeed.

I am currently trying to line up a real merchant account for myself.

I believe that 3rd Party Processors are too vulnerable and that the Cartel is too aggressive not to want to shut these guys down.

In Canada, I am looking at PSI-Gate. They need a lot of documentation, but at if you say you're transfering from someone else they appear to wave the set up fee.