2Checkout Overall Rating
2Checkout (2Checkout.com & 2CO.com) is an electronic payment service (merchant account alternative) founded in 2000 that allows online merchants to accept credit card payments from their customers. Also called “2CO,” 2Checkout offers similar services to those of PayPal, Google Checkout, and Amazon Payments with at least one major difference: unlike the others, 2Checkout does not solicit the merchant’s customer to sign up for a 2Checkout account and simply lets the customer pay by using a credit or debit card (among a few other options). For the purposes of this 2Checkout review, we’ll be focusing on the company’s credit card and debit card processing services.
2Checkout focuses its service solely on providing online payment options to small and mid-size businesses and claims to have much lower shopping cart abandonment rates than its competitors. This focus also allows 2Checkout’s services to be more feature-rich and centered on the needs of online sellers. Some of these extra services include a hosted shopping cart that can be easily set up and installed using code snippets, integration into third-party shopping carts, a PCI compliant payment gateway, and a robust user dashboard that has multi-level user access controls to filter what different users can see and do on the system. The one feature that lacks with 2Checkout is a virtual terminal, unless your business is a non-profit. Therefore, for-profit merchants cannot use 2Checkout to enter credit card information by hand. The details on the virtual terminal are somewhat unclear, so there may be exceptions depending on individual merchant needs.
Another notable feature of 2Checkout’s service is the ability to accept foreign currency. Customers can choose from eight different payment methods, 15 languages and 26 different currencies. 2Checkout also serves merchants in 25 other countries outside of the U.S. 2Checkout’s U.S. headquarters can be found at 855 Grandview Avenue, Suite 110, Columbus, OH 43215.
|Key Points – Sales & Marketing|
|Uses independent resellers?||No|
|Promotes deceptive rate quotes?||No|
|Discloses all important terms?||Yes|
2Checkout does not appear to use any misleading sales tactics or marketing in its official materials. The service is primarily marketed online through advertising and affiliates. All pricing is clearly displayed without hiding any processing fees or rate tiers, and there are no online complaints filed here or elsewhere that describe issues with the company’s sales staff.
2Checkout Marketing Example
|Key Points – Costs & Contract Terms|
|Domestic (U.S.) rate:||2.9% + $0.30|
|International rate:||3.9% + $0.30 or 5.5% + $0.45|
|PCI compliance fee:||None|
2Checkout’s pricing and fees are fairly simple. The company offers month-to-month service with no cancellation fee, and its credit card processing transaction fee for U.S. merchants is 2.9% plus $0.30 for all transactions. For U.S. merchants to accept international cards, the transaction fee jumps to 3.9% plus $0.30, and for international sellers, a transaction fee of 5.5% plus $0.45 applies to all payments. There is also a $10.99 setup fee for international accounts. The company’s “Pricing” page mentions that 2Checkout may, at its sole discretion, charge a higher transaction fee than the one advertised “if we determine that the Products or business practices of a Sub-Merchant create a potential or actual financial or reputational risk to 2CO, such as the sale of Restricted Products or high chargeback percentages.” It is unknown how the company calculates or enforces this potential rate increase, but there are not many merchant complaints about it at this time.
It is important to note that even though 2Checkout’s processing fee is somewhat high, 2Checkout offers several valuable services that are easy to use, and the company has no cancellation fees.
Other 2Checkout Fees:
|Change URL or Domain Name||$19|
|Percent of Disputes Incurred During Entire Account History||Fee for each Dispute|
|Up to 0.5%||$20|
|5 or more Chargebacks in last 30 days and Chargeback rate between 0.5% and 1%||$30|
|5 or more Chargebacks in last 30 days and Chargeback rate between 1% and 2%||$40|
|5 or more Chargebacks in last 30 days and Chargeback rate over 2%||$50|
There is an additional $15 fee for each charge dispute a merchant challenges.
There are a few other fees only charged in circumstances unrelated to credit card processing. Merchants wishing to accept electronic checks and other forms of payment will want to inquire about the associated fees.
|Key Points – Complaints & Service|
|Total complaints:||Over 30|
|Live customer support?||Yes|
|Most common complaint:||Fund holds|
Like other popular merchant account alternatives, 2Checkout suffers from the problem of being available to just about anyone who wants to accept payments and therefore has a few dozen complaints filed online. Of the complaints, many appear to have originated from people that did not understand, or take the time to understand, the company’s fees and services. Of the valid complaints, the two common types are of 2Checkout holding a merchant’s funds or cancelling a merchant’s account, both of which are likely due to the merchant engaging in a business with a high risk of fraud or Chargebacks. Although it is generally not our policy to lower a company’s score for having stringent fraud prevention policies, it does appear that 2Checkout could do a better job of communicating to merchants that any pending payments will not be released for 90 days after cancellation.
|Key Points – BBB Report|
2Checkout has been accredited with the Better Business Bureau (BBB) since 2001 and, as of this review, holds an “A+” rating with 70 complaints filed in the last 36 months. Of the complaints, 49 are regarding problems with service, 12 with billing and collection disputes, four with advertising or sales issues, three with delivery problems, and two with warranty or guarantee issues. 2Checkout has been able to resolve 55 out of the 70 complaints.
2Checkout offers an easy-to-use electronic payment alternative for accepting online payments and e-commerce transactions. Overall, the company scores well in customer satisfaction compared to similar providers of its size. To avoid problems, merchants should take care in understanding 2Checkout’s policies and procedures, especially regarding acceptable business types and transactions. 2Checkout’s processing fees are slightly higher than average, but the added cost also comes with a feature-rich service that is customizable to most online retailers’ needs. Visit 2Checkout at: http://www.2checkout.com.
This review was originally published on 12/12/12 and was last updated on 7/11/14.
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