Forum Moderators: buckworks
We have a 100% record and have never had any problems or chargebacks.
The credit card company says that if you accept internet orders then you must have another account and processing terminal. This seems to be simply a racket designed to extract another tax of around £20 a month for a second terminal.
To be blunt, we do not have a second terminal and don't intend to apply for one. We see no difference between an order sent in by street mail, telephone or fax and an email order.
How will the vultures ever know about your internet orders? It seems that the best strategy is simply not to tell them. Has anyone encountered this and what do other small merchants do?
I guess that with your store you'd need to keep your main terminal, but if you obtain an Internet Merchant Account I doubt you will actually need to pay any kind of rental on that service. It's a kind of Pay-as-you-go. With us, we just have 2 merchant account numbers. One for internet and one for non internet transactions. We get one bill but itemised separately.
If your card processor is Streamline, I found out something else that might suit after we'd signed up for UPG. Let me know if you need further info.
The reason is: the internet (keyed) has a higher risk of being charged back / fraud.
You ask - how will they know? Well when you sign up for a merchant account, yuo are usually asked what percentages will your transactions be swiped, keyed, etc. If you start to go above these percentages, that will ring a bell.
Also, when you key in a credit card - it might be considered a non-qualified swiped transaction. And depending on your merchant agreement, you might be charged 2% more for that transaction. So your swiped rate is 1.55% & that $100.00 keyed transaction cost you $3.55 instead of $1.55. So it will add up if you think about it when an internet account usually is about 2.25%.
Corey
Corey Bryant - 80% of our business is MOTO (customer not present, and across the world) I don't see how they can tell whether the order came in by phone, fax, letter, email or secure on-line order form. Nor do I see why internet orders are especially risky - as I say, we have never had a charge back in 8 years.
Of course, it is a specialised business selling goods taht cannot easily be turned back into cash but many of our customers are regulars and we do not ship goods to any country with green in its flag.
Because it is a faceless, traceless crime. There is no handwriting evidence (cheque) and they are not recorded (phone) and you have no source fax number that can be tracked (fax).
I have a lot of fraud attempts (about 5% of orders are attempted fraud, recently).
You do not have to tell your merchant if you are processing internet cards, but that is against the terms. They will find out. There will be fraud. Anyone can do a chargeback and you will have to accept the chargeback. You could not challenge it with 'internet' evidence if you do not have an internet agreement.
You are potentially losing your merchant account. (You will not be able to sign up with anyone else, either, as Visa/MC will blacklist you. You may also get a bad credit record for false declaration of use of account.)
I don't either, but the credit card processors do. They lay out the rules for a good reason....primarily online transactions are more fraudulent than transactions made in person.
At the end of the day the difference in processing fees is a tiny amount.....if you are a serious business then just eat it, and live with it. Is $20 or $50 a month really worth getting involved over?
You said that 80% of your business is via other means.
Let's say you do $50,000 a month in sales. 80% of that is $40,000.00. If you had an internet account with a discount rate of 2.25%, you would be spending $900.00. But if you are are keying in those transactions & your discount rate for a non-qualified swiped transaction is 4.25%, you are spending $1700 a month - $600 more a month that you need to.
And PCInk is correct, if you get on that MATCH list because you put down erroneous information on your CC application agreement, you might not be able to process CCs again.
-Corey
-Corey
This does not sound a lot - yet credit card charges are our third highest overhead cost, after staff wages and rental of premises.
If there ever is a chargeback I accept that it is at our risk and our expense - so why should the card processor beef? As I understand it from other posts the merchant has to pick up chargebacks in any case, regardless of whether he is at fault or not.
We don't record phone calls and I don't see how it would help if we did. Likewise fax headers can be forged or blanked out.
