posted on March 3, 2003 08:00:07 PM new
I have reached a point where I would like to add a merchant account to my business. Most of my eBay customers like PayPal, but I think it might be turning off my website customers. Does anyone have experience with PayQuake? What is a reasonable reserve for an internet merchant account?
posted on March 4, 2003 08:27:04 AM new
I researched merchant accounts for a series of articles I did for auctionbytes. I actually opened 5 accounts to see how they functioned and how their policies matched their promises. You can read the articles at
www.ccs-digital.com/merchantact.asp
posted on March 4, 2003 10:26:56 AM new
Thanks for the responses. I've heard good things about Echo. Payquake wants a 20% indefinite reserve, which seems excessive, but I haven't been sure what is a common standard. Echo has placed a sentence at the bottom of their page that reserves may be required for some merchants, so I'll see what their terms are.
posted on March 4, 2003 01:18:36 PM new
I have referred around 100 accounts (that I know of) to echo over the years. None of them have ever had a reserve placed on them.
Of course all of the accounts I have referred are apparel or footwear accounts. We are pretty low risk.
posted on March 4, 2003 01:32:20 PM new
In my article, I recommended Payquake, so I just had to call and find out what this reserve deal is. This is what they told me:
If a person has bad credit or a previous bankruptcy, they will withhold between 5% to 20% of a month's charges for up to six months. At any time during that period, they will release the money if they feel the person is no longer a risk. In any case, all funds are released after 6 months. I believe this is a fairly standard practice. I am in the process of opening a Payquake account and was already told it doesn't apply to me.
posted on March 4, 2003 04:14:01 PM new
Once you open these accounts (I have propay) where do you put them, so customers can enter their cc numbers? You can't do it on your Auctionwatch store, so is on another site, or what? I use Propay right now, but customers would prefer to enter the card themself rather than call/email me.
posted on March 4, 2003 04:28:10 PM new
The best way is to get at least one secure page on your site. Most folks will not enter their credit card numbers on an insecure site.
By the way, Propay is NOT a merchant account. They act as a middleman between you and the customer, just like paypal, except that the customer doesn't have to open an account so it looks like you have a merchant account. However, there are several drawbacks to Propay.
1) the limits are rather low. $250 maximum per transaction with $1,000 maximum a month (unless you apply for more and send them a hefty deposit). When I used Propay, someone placed an $800 order and I had to enter it as 4 separate transactions.
2) there validation stinks. I did about 20 transactions with them and it ALWAYS said the address was wrong, even when I tried my own credit card.
3) I have heard from others that if there is a chargeback, you automatically lose because Propay doesn't take the time to investigate.
Payquake's fees are actually a little lower than Propay and they give you a real merchant account. As your business grows, you can move up to the next tier where the rates are lower as long as you maintain a monthly minimum.
posted on March 4, 2003 04:39:02 PM new
Thank you for the info. As I understand it, I would have to buy a secure page from a host then put a link from my Auctionwatch Checkout to that secure page. And on that secure page I would place the "credit card accepter"....for lack of a better (and correct) term! LOL. You are right about Propay..and it is rather expensive.
posted on March 4, 2003 05:25:07 PM new
Maybe auctionwatch can provide a secure page. I would assume that there must be merchants using their service who accept credit cards.
Secure pages are actually overrated. All it means is that the server is secure from "listening devices" that can grab the packets as they travel between the site and the customer. (the transmissions are coded). I haven't heard of a single case of a credit card being stolen because someone grabbed the packets submitted on an insecure site. The only theft I have heard of is when someone hacked into the site *after* the information was already recorded.
Before I had a secure page, I had a non secure page for order entry. I told my customers that if they were uncomfortable, they could enter half the number, hit submit, hit the back button and enter just the second half and submit again or email me the second half or they could call it in or fax. I'm sure that I lost some business from folks who didn't like that approach, but I still received a lot of orders.
posted on March 4, 2003 05:30:25 PM new
propay is expensive,but they do offer some sort of customer service,like give you the cc issuer phone number.
but if you have a full fledge merchant account-there is statemnt fee,minimum fee,avs fee,transction fee and discount fee.
so depends on volume,you may just come out the same.also commitment of one year or 6 months.or more
propay makes a good backup,so is billpoint.
posted on March 4, 2003 05:45:56 PM new
That is why I recommend Payquake. Their fees are:
$49 annually (which you pay after you have tried the service for 3 months)
3.5% + 50 cents per transaction
No monthly minimum, statement fees, monthly fees, gateway fees, etc. Since they use the authorize.net gateway, which is one of the most popular on the net, most shopping carts will work with it and customers can enter their cards and have them automatically charged (though I don't recommend this for security reasons). Money is automatically deposited in your account a few days later. You start off with a $5,000 a month limit and you can even raise that (but if you have to raise it, you should be going for an account with a lower rate).
Propay charges (last time I looked) $35 plus 3.5% + 35 cents, but they charge the 35 cents on both the charge and the withdrawal, so you pay about 70 cents. There is no gateway, so you have to manually enter every charge and then you have to go back and withdraw the money to your account. Their AVS did not work and even if it did, they will not contact you if there is a charge back, they will just take the money plus the charge out of your account. There is a $250 maximum transaction amount and a $1,000 maximum monthly amount. So the way I see it, it is more expensive, more difficult to use and offers no protection at all. Against Payquake it is just no contest.
Propay is for US merchants only. Payquake is expanding into Canada.
posted on March 4, 2003 07:12:56 PM new
they do notify you of chargeback and give you a chance to defend yourself,they also do not like intl cards.
you can raise the limit to 2000,3000 but they will want a 250 reserve and if you wind down,it will take up to 6 months to get the reserve back.
they are quick to make available your fund,unlike paymentech,it could be 7 days.
