posted on December 19, 2001 11:17:51 AM new
I don't know where to go to get the information I need so I thought I would try here. Maybe someone can point me in the right direction.
I have a friend who sold a large order at his B & M to the Navy. They paid with a credit card (didn't realize the military had credit cards).
It has been about two weeks and the money has not been put in his bank yet. He called the bank and they advised him to call the company he has his Merchant's Account with. He called the company he has his Merchant's Account through and was told that since it was such a large amount they were going to hold it for awhile! Apparently they can hold it up to 180 days, or at least they are claiming they can.
Now, he doesn't know what to do. He has not been happy with this company since signing up with them and is looking for a new company but doesn't know how to pick a good one...this is his 3RD company in 5 years!
Any suggestions on which company he should try? He has a website he sells from on top of his B&M and needs a company that can do it all, regular cc processing through his store and shopping cart for the online sales.
posted on December 19, 2001 04:15:56 PM new
Thanks krs!
I did discover that one needs to be very careful about who they sign up with to process a cc and read the small print. Probably should even have an attorney or someone with a little knowledge of "legalese" looking at it before signing on the dotted line. Apparently there are various ways the companies can conduct their business.
In this case, it is clearly stated (on about page 15) that they reserve the right to hold funds for up to 180days! I couldn't believe that.
Spoke to another fellow having a similar problem with his Merchant Account, his funds are being doled out to him because when he signed up, he put down he expected to do about $3,000 a month in cc business. He, too, got a really big payment and the company he deals with only release up to $3000 TOTAL CREDIT CARD PAYMENTS a month to him!!!! They carry over and hold anything above that amount.
According to his company this, too, is legal!?!?!?
What I would like to find now is an ombudsman or someone who watchdogs the industry so we can check to see if it is legal.
posted on December 19, 2001 04:41:03 PM new
I haven't heard of the holding of funds and I wonder what they're holding them FOR in the cse of that navy purchase. Their credit is pretty good. BTW, almost all gov't agencies wnt to a CC payment system beginning in 1990 to ease their accounting and speed payment to vendors.
I did have a neighbor who was very surprised at what he had committed to in estimating his revenue expectations and signing up for a plan that gave him a discount so long as he met his stated expectation. His problems arose when he didn't meet those amounts and found that he was charged a very high percentile penalty for his 'shortfalls'. He had not read his contract and swore that that clause had not been mentioned by the CC representative who signed him up.
posted on December 19, 2001 05:31:10 PM new
That's just it. According to the Navy Rep, the funds have been approved and released (he was nice enough to actually check to see if it was being held by their cc company) so the problem was not the Navy.
The company that my friend's merchant account is with is the one holding the funds "as per their right". Seems they make money on the funds while they are holding them above and beyond what the merchant will fork over.
It is in the contract that they have the right to hold funds up to 180days. It was not pointed out by the rep who signed him up either, just the good points were outlined...
Apparently these companies that process the cc are able to negotiate a contract with the merchant just like any other business is able to do and they can pretty much write anything they want into the contract. You sign it, your agreeing to their terms.
On the other side of the coin, the merchant would probably be able to negotiate a better deal than he is originally offered because there apparently are NOT set things that are etched in stone about how the business has to be conducted.
He will get his money, just not as soon as he had hoped for.....there is apparently nothing he can do about it either.
He's decided to go looking for company #4 ( after he gets his money from this company) only this time he's taking a lawyer with him!
I'm still trying to find who regulates or watches over these companies. Surely someone does?????
I hope so anyway....I get spammed everyday by these companies wanting to set up my Merchants Account, with the best rates in the business!!!! I don't like the thought that maybe nobody is watching how they do things and they get to just make up their own "rules".....
