In Operating a small business it is important to find vendors that help you and want you to be successful. You need them to be on your team so to speak. Well let me tell you that when we choose iPayment, Inc. Credit card services we made our biggest error in judgment. We have been with iPayment for about 7 years without a charge back because we are careful about checking out our customers since our product sales are usually thousands of dollars per item. The last 8 weeks have been a nightmare of us and iPayment, Inc. Has been a worse nightmare then the individuals who bought our goods with stolen credit cards. The scenario whet like this; purchases where made, credit cards approved, we sent the products and then about one to three months later the charge backs start coming, some without notice!
We hired an attorney to help us sort it all out and after she read the iPayment contract she was shocked. She said she never saw a contract that was so one sided and scolded us for signing it! IPayment's contract allows them to basically go into our checking account and take money out for what ever reason they deem necessary at any time. And then they are also allowed to hold this money or any future money from the merchant's sales for 90 to 120 days without reason. Can you believe this? How can a merchant survive for 90 to 120 days without income and still function? And according to their merchant contract, if you try and stop iPayment from doing this, they will report you to Visa or MasterCard and have you? Blacklisted? Which will shut down your credit card payment system forever! One of our charge backs was vindicated but iPayment refuses to return the money to us saying they now are holding our money for 90 days.
Our attorney is trying to find out why. Today iPaymnent went in and took back another approximatley $2,700 and did not tell us why. IPayment's customer service representatives are sometimes rude to merchants and not helpful, in fact you get the feeling they are working against you. Our attorney is still waiting for a return call after being told that two of the mangers she requested to talk to are on vacation! So now iPayment has approximately $4,500 of our money. We immediately switched bank processors and my attorney is now looking into having us close our checking account.
But it is not that easy, the iPayment contract states that if we close our banking account before cancelling our contract with them, then we are in breach of contract and they will? Blacklist? Us with Visa and MasterCard.in addition, we have missed the annual 30-day opportunity to cancel the contract with iPayment (as stated in their merchant contract) so we cannot legally cancel the contract with iPayment for another year. So they really got us. Even our attorney is surprised and advised us not to process anymore payments through iPayment ever again. We are still trying to figure out what to do.
Merchants like us are really getting a bad deal here. The credit card companies are getting high interest rates from consumers and the merchants are assuming all the risk in every transaction.in addition the merchants have to pay a bank merchant's fee on every sale. This has got to stop, something has to be done to level the playing field. Merchants are relying on companies like iPayment to approve payments, but these companies do not stand behind their approvals!
I think it is time merchants rebelled against this form of unfair practice. Anybody interested in a class action lawsuit? Or perhaps we all need to refuse to accept credit cards! My advise to all merchants is to have an attorney review your merchant contract before you agree to it and avoid iPayment, Inc. At all costs!
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