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> The banks only want to drop you if you're attracting too many charge-backs, fraud, or money laundering. If you have a good system in place to minimize these problems, they will gladly take their processing fee from each and every transaction you process and they will do it with a smile. Wrong. I know this first hand. First, "banks" do not decide whether you process or not. People do, and these people are, in my experience, fairly corrupt. Most people don't deal with the banks directly, but even if they do, the agents their aren't just dealing with you. All it takes is for you and a competitor to end up using the same bank, and if that competitor is bigger than you, they can push you out. It's not difficult. I've been on the receiving end of this. I've heard it all. I've had the agent on the phone, and wouldn't answer the question regarding which transaction they were claiming was against their policy. A few weeks later, after closing us down, the send us the information for a transaction that occurred after they shut us down, claiming that was why we were closed. Chargeback levels? Well below the threshold. We had practically no actual fraudulent transactions, and more than 95% of the transactions that were pending chargebacks were friendly fraud (authorized card holder claiming a chargeback). I'm not talking about some small time shop. We were pumping 8 figures through our banks at our prime, all as legit as we could make it (which at the time, was far more secure than most other processors at the time). Your sentiments are right. The banks are interested in money, and if you are bringing in the transactions, they'll process. Unfortunately, if you're a small fish in a big pond (and yes, a small fish processing in the 10s of millions a year), and a bigger fish wants you put down, the bank will take the work to keep the big fish happy. And if it sounds like I'm pissed, it's because I am. It's working so hard for so many years, pushing forth so many cool things, just to see it collapse. Not because you did anything wrong, but because someone maliciously screwed you over. That's why I avoid looking at anything as a startup that forces me to rely on a single point of failure. Working with Visa and MasterCard puts you under their control. Sure, accepting money online puts you at their mercy as well, but it's not the same as building your business being an actual processor. Anyways, I've rambled on long enough. Don't take offense if I caused any. That wasn't my intent. |
There have been some less than scrupulous operators of payment systems in the past which have made it much harder for bona-fide operators to get started or to become even moderately successful. The fact that any such service instantly attracts a bunch of money launderers also does not help (that's not fraud from your perspective, but it is illegal and you are instrumental in making it work).