3rd party processor at less than 5%?

bye, ibill, bye.

[new_shoes]

I thought I could manage to find the answer myself, but I need help!

I am looking for a replacement for iBill (internet billing), our current 3rd party credit card processor. We pay them in excess of 15% per transaction and we are not in the porn industry, which is what they cater for.

We are aiming for a processor which:
- does not require a merchant account
- takes maximum 5% flat pr transaction
- offers recurring billing (aka rebilling or subscription sales)
- is not late with payments (which ibill always is)
- has a good interface to the sales data and preferably offers the data in raw excel sheets

We used these sites to find a good processor:
http://www.mgoldmine.com/index.aspx
http://www.eprofitnews.com/payment-processors.shtml
http://www.3rdpartyprocessors.com/third-party-processors5.shtml
http://www.online-payment-processing.com/

The best we have found is World Pay, but they won't accept us because we are based in a non-Western country. We have a good track record with ibill and have over $350k in CC sales pr. year.

The second best bet is Pay Systems, but I have read nightmare stories from other merchants about late payments and (unjustly) withheld funds.

Where can I look?

[edited by: lorax at 7:44 pm (utc) on Feb. 14, 2005]
[edit reason] delinked [/edit]

[OlRedEye]

Maybe you should look at ccavenue. I signed up but never used them as they did not respond to e-mail enquiries, and this was right after I had a bad trip with 2CO not responding for 3 weeks to a transaction enquiry.
Some say good things about them. Havn't seen anything negative. mmm maybe I should try.
Surprised at your comment about worldpay... they are international.

[Corey Bryant]

What do you sell? Are you still looking for the customer support that iBill provided? Where are you located? There are a few other processors out there that will get your own merchant account & offer your clients the customer service. Or if you just want a 3PP, there are some other suggestions as well

-Corey

[hfwd]

Why not just get a merchant account? Many charge just between 2 to 3%, and have recurring billing option.

[multitaskerVic]

pay systems 3rd party processing is now gone, all they do are merchant accounts now

if you have a good history as you said, finding a good 3rd party system shouldn't be too hard

[Corey Bryant]

Why not just get a merchant account? Many charge just between 2 to 3%, and have recurring billing option.

Usually for United States merchant accounts, that holds true. But for merchants not based in the United States, rates are somewhat higher because the tracking is a bit more difficult.

-Corey

[new_shoes]

I sell access to a library of academic articles mainly targetted at 18-30 year old Americans and Europeans. We are based in South America and would like exactly the sort of service ibill provides.

We are hesitant about getting a merchant account because:
1. It seems like an incredible hassle when not based in Europe or the States
2. We would have to make individual deals with each credit card company - right?
3. Our average sale is $8 and last year we had some 45k transactions. My impression is that we would have to spend loads of time dealing with refunds, chargebacks, etc. At the moment ibill takes care of all these things for us.

Maybe I'm wrong about these ideas?

If we could get a merchant account and another company would take care of the deals, the refunds, the chargebacks etc. I would certainly be interested. As long as we can keep the fee below 5% and won't have to spend more time handling the payments than we already do.

Concerning CCAvenue: we were very excited when we found them, but unfortunately they do not offer rebilling. Thanks for the tip anyway.

[Corey Bryant]

There might be a few options available to you actually. if it is OK - I can send you a PM & give you a few different companies.

-Corey

[multitaskerVic]

actually no, you don't have to make individual deals. V and MC are handled on one application, you can add the other cc's onto the SAME application also - it's not an individual thing.

If you get a processor thats willing to work one on one to get a system that best fits your needs it'll be best.
Perhaps you can 3rd party with them while they assist you in getting a merchant account set up.

Although it may seem daunting, its really not that hard if you have someone handling all the details for you. Thats why its so important to use someone that gives you personalized care.

ps recurring is not a problem
Let me know if I can be of more help :)

[new_shoes]

Thanks for the interest and answers, guys. There is lots of food for thought here.

[edited by: lorax at 7:48 pm (utc) on Feb. 14, 2005]

[ironbiker]

I am New_shoes' associate and have a few questions of my own.

1) If we open an international merchant account here in South America - would a payment processor in the US accept us? The vast majority of our clients are based in the US.

The reason I ask is at least here where we live, if you want to buy something with your credit card say, on Amazon, you need to have an International Credit Card - not just any credit card. However, when I lived in Europe, I could buy things just about anywhere in the world with my standard credit card.

2) If having an international merchant account here in Soth America would prove to be too complicated, is it easy/possible to get a Merchant account in the US? I suppose we would need a corporation to do that right? What are the risks/factors/costs involved in setting one up? Are there companies specialized in doing this? If so, please recommend!

Any input would be highly appreciated.

[edited by: lorax at 7:45 pm (utc) on Feb. 14, 2005]

[multitaskerVic]

Hi ironbiker,

I spoke with red_shoes about your processing at one time and will try to help answer these questions for you.

""1) If we open an international merchant account here in South America - would a payment processor in the US accept us? The vast majority of our clients are based in the US.""

Yes, if the merchant bank can process the US dollar then a US based gateway/processor will be able to work with you.

""2) If having an international merchant account here in Soth America would prove to be too complicated, is it easy/possible to get a Merchant account in the US? I suppose we would need a corporation to do that right? What are the risks/factors/costs involved in setting one up? Are there companies specialized in doing this? If so, please recommend!""

It is possible to get a US based merchant account but I wouldn't exactly call it easy.
To obtain one you'll need:
US based address
US phone number
US banking account
SS# of a US resident (business agent) that has decent credit

It helps if you have a US corporation, yes, it can give you a Federal Tax ID which banks always like to see.
The costs are pretty reasonable and the only risk I can think of offhand is if the merchant bank you apply through doesn't care for the 'corporation-in-a-box' type corp (I haven't seen this happen very often)

I hope this helps :)

[ironbiker]

Opening a corporation in Delware or some other state seems a dodgy solution to me. We would be subject to US laws and taxation - which is not what we want, unless a lot of people are doing it and the risk is next to zero.

Basically what we need is a company that does exactly what iBILL does:

1) Accepts Credit Cards and Checks
2) Does rebilling
3) Works in real time and provides instant notification
4) Has payment pages that are completely customizable
5) Charge arround 5% per transaction (i.e. are way cheaper than iBILL).

We are a low-risk business and feel it is not fair that we are chaged over 15% for the service. Our revenue is arround $10,000 / week. Revokes, etc. represent arround 2% of total revenue.

I would greatly appreciate referals or recomendations of large, reputable companies that have been in the business for a while and meet the above requirements.

Thanks in advance.

[jamie]

just a thought, but are you not able to contact a bank directly and use their own payment gateway to charge credit cards

we are based in non-uk europe and deal directly with the bank. we pay a very low %

[ironbiker]

We are looking into that possibility as well, but find it might be problematic to charge US credit cards here in South America, seeing as regular people here need an International credit card to be able to do purchases outside of our contry. However, one thing might have nothing to do with the other.

Another problem is having to deal with rebilling. Storing user's credit card's isn't exactly something most people feel comfortable with.

[multitaskerVic]

Ironbiker

I agree, storing peoples cc information if you are not a gateway is a big no no lol

None of the requirements you list are a problem .. but if I recall my conversations with red shoes, its the per transaction cost thats at issue .. correct?

[Corey Bryant]

It all depends on monthly volume, type of products, etc. A third party solution can start at about 4% for mainstream and go up to 12% for the Adult.

Plus it depends on the acquiring bank if you need to pay the registration fee as well. That is not required by all acquirers.

-Corey

[ironbiker]

Well, if we could find a 3rd party provider that would offer all that we want at arround 4-5% per transaction (with no flat fee on top, or a very low flat fee so that overall the cost would not exceed 6% per transaction), then we would be very interested.

However, I've looked arround a LOT and don't seem to be able to find a 3rd party provider that does that.

[nonstop]

are 2checkout or paypal no good?

[Essex_boy]

We would be subject to US laws and taxation - Not so in Delaware if you dont trade in the state. You only have to pay an annual franchise tax based on yourcapitalisation.

you dont even have to file your shareholders details - its just a small fine each year.

[multitaskerVic]

Ironbiker

Well you actually fall in a grey area, not exactly the low risk you would think.

Many of your transactions would be non-qualified (out of the country cards etc). Non-qualified transactions cost more for everyone involved, including merchant banks.

On top of that you have a high percentage of low-dollar transactions which echo the non and mid-qualified costs stated above.

Then you have a 2% chargeback ratio to consider.

Although you are correct in saying you aren't high-risk, factoring in all the specifics, you can see it isn't exactly low-risk either, its about midstream.

If you like I can pm or email you more information on whats available for you to consider, its not as bleek a situation as it seems :)

[ironbiker]

Well... I guess if we open an International Internet Merchant Account in South America - then since 99% of our clients are in the US - the transactions would be foreign... but if we opened a Merchant Account in the US - they wouldn`t be. We are BankBoston customers here - which has offices all over the world, that might help.

Anyhow, please do PM me to let me know of my options.
Thanks in advance!