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Business Account Frozen? Stop Using Aggregators…

Let’s suppose that after years of educating myself and climbing the career ladder I become so inspired by some product or service that I risk my livelihood, quit my job and invest my life savings into a business. You better believe I’m going to take that business seriously and it doesn’t matter if I’m selling doughnuts, underpants or widgets…. You better not mess with my money.

I’m pretty sure that is the sentiment of every business owner on the planet. Unfortunately, there are plenty whose money IS being messed with, and they are not happy about it. Their stories can be found all over the internet on blogs and complaint forums. Unsuspecting business owners, signing up for credit card services through well known aggregators like Square and PayPal are ready to blow a gasket when suddenly they aren’t getting funded their hard earned money.

Here is just one example, “They [Square] are holding over 50K of our Companies funds and some payments have been held for over two months. I cannot speak to a human only e-mail with no response. We rent vacation homes and do transactions of $5,000 – $10,000 each. All of my customers say their credit card was charged long ago and some have even paid their bills. Why is my money being held? “

Here’s how it all goes down: So, I want to sell my fabulous product and I sign up for Square (it’s so quick and easy). I am up and processing in no time without filling out a tedious application. Things are going really well, my business is growing rapidly. I am swiping cards through Square left and right and promptly getting the funds back in my bank account. My product is in high demand, I am hiring more staff to accommodate sales etc…  I check my account one day and BAM, no funds have been transferred in a few days, and suddenly – I can’t process any payments on my handy little Square…Yikes. I go to Square’s website to find their phone number, oh wait, they don’t have one. I guess I will have to Tweet them (WHAAAT!)

When they decide to Tweet, Facebook or email me back, they say (taken directly from their Facebook page in response to an actual angry customer that couldn’t get an email response) “Hello, we’ve taken a look at your account and see that we reached out to you on [insert date] with an application to increase your manual entry payout limit. Please fill out the application so that we can move forward with your account.”

So, I have no money, can’t pay my employees, can’t buy any inventory, and can’t sell what I have…My customers are getting increasingly more frustrated, resulting in a shrinking customer base and all I am left to do is Tweet. Not to mention that once I fill out that application to go through underwriting, if I am denied, then what?

What can we learn from this fun little scenario? Aggregators are designed to process for micromerchants who have teeny tiny businesses and plan on staying that way. They have deposit limits and algorithms that intentionally freeze your accounts so they are not taking on a high risk. Your business growing = More money processed = Higher risk for them.

Here is an excerpt from a post in favor of using an aggregator account, under the right circumstances, “I normally don’t write reviews on websites, but after seeing this post and all of the negative comments I had to say something. Firstly, Square is for people who need to process a low volume of cc payments and who either don’t meet the requirements for a merchant account…” He continues, “…and if you are low volume and in need of cc solution that can be used anywhere, then I recommend square. If you are amazon.com than you should look elsewhere…”

And we concur; if you are looking to start a business and actually grow it, don’t go the way of an aggregator. Go through the process of setting up your own merchant account and take control of your money, your business and your livelihood.

Photo courtesy of: https://www.thebluediamondgallery.com

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