October 11, 2010
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Question:
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Ken
You recently had this question and answer:
"Is it acceptable and legal for a supplier to claim they do not take
credit cards but they will accept a credit payment through a third party
company and charge a 2.5% payment processing fee?
The answer stated that it is illegal for a third party to charge a fee to process a credit card transaction for someone.
Could Tom Aronica explain how Paypal can exist
since this is exactly what they do? Paypal allows businesses and
individuals who do not have merchant accounts to accept credit card
payments and they charge a fee for this service.
Thank you.
Mike
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Answer:
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Here is Tom's response:
Ken –
Pay Pal does not necessarily charge a fee, per se. They charge increased discount rates to process the transactions (think of them like a mortgage broker). PayPal and Google Checkout aren’t affiliated with any financial institution, so they don’t have to abide by the same rules. That means less protection for your business. When you are seeking a payment processor, you want to find one that is a registered ISO of their acquiring bank. For example, PCI Professionals is a registered ISO/MSP of Wells Fargo Bank, NA – this shows that the institution you are working with is fully regulated for your protection.
The truth is, not all payment processing companies are created equal. Sure, PayPal and Google will process your payments—but they’ll also charge you more, offer little personal assistance, and enforce inconvenient restrictions on your business. At PCI Professionals, we’ll handle your payments on your terms, for less. And we’re there when our merchants need us, from setting up their shopping carts to closing the deal.
Compare PCI with other online merchants, and the difference is clear:
Checkout
A professional appearance leads to higher sales. But a payment processing service that forces your customers to leave your website can make your business look second-rate. Both PayPal and Google Checkout take customers away from your carefully designed online store at the crucial point of purchase—and that almost always results in lost sales. PCI Professionals seamlessly integrates your shopping cart into your website, eliminating other companies’ bulky payment processes and maintaining your credibility as a business.
Payouts
The world of business moves at light speed—but PayPal doesn’t. Moving funds from your PayPal account to your bank account can take several days, delaying your investments. PCI Professionals sends money from sales directly to your bank account, so you can immediately make your next big move.
Public Image
Think PayPal is problem-free? Think again. The Internet is flooded with websites chronicling the company’s shady business tactics, both from merchants and consumers. Some relate tales of PayPal “freezing” their accounts; others try to contact the company’s customer service department in vain. In fact, many have sworn off companies like PayPal altogether—and by using their services, you could be alienating customers. PCI Professional’s services, on the other hand, are both reliable and invisible to your customers. And our customer services department is always there when you need us.
Best Regards,
Tom Aronica
800-617-9980 x 3201