Appstar Overall Rating
Last Updated: February 6, 2014
Appstar Financial Overview
Appstar Financial (appstar.net) is a U.S.-based merchant account provider that primarily targets its services to small and mid-sized businesses. In addition to offering credit card processing services, the company also provides debit card processing, check processing, gift & loyalty card programs, EBT processing, merchant cash advances and processing software and hardware for both in-store and e-commerce sales.
Although we have not been able to verify it independently (primarily because the information is private or difficult to attain), Appstar Financial may be under the same ownership, or affiliated with, the following companies (as indicated by third-party reviews and information): Apex Merchant Group, Eliot Management Group, Trans Tech Merchant Group, Summit Merchant Solutions, First American Payment Systems and Certified Payment Processing.
AppStar Financial is a registered ISO/MSP of Fifth Third Bank, Cincinnati, Ohio, with corporate headquarters located at 4619 Viewridge Ave., Ste. C, San Diego, California 92123.
Appstar Financial Sales & Marketing Tactics | D
Based on merchant reviews, it’s apparent that Appstar Financial relies heavily on telemarketing and independently contracted outside sales agents to market and sell its credit card processing services. Like most providers that use these tactics and score poorly in merchant reviews, Appstar appears to incentivize agents by linking higher commissions with higher rates and fees for merchants, including fees and lease terms on equipment. Due to this practice, agents are often focused on setting up expensive merchant accounts and long service agreements in exchange for higher payouts.
It is unclear if Appstar management condones aggressive sales tactics or encourages high pricing, but it appears that, at minimum, there is a lack of oversight and education of many of its agents. Additionally, it looks as if Appstar enforces agreements even when merchants describe the use of deceptive sales tactics by an agent.
Other than problems regarding Appstar’s telemarketing and sales agents, we found no other obvious examples of deceptive marketing.
Appstar Financial Costs & Contract Terms | D
Appstar Financial merchant account costs and fees will likely vary from one merchant to the next based on the merchant’s business type and the agent setting up the account. Numerous merchants are reporting high fees and being misled to believe that Appstar will be less expensive than their current provider, only to experience much higher costs once activated. The company’s standard agreement includes a three-year service agreement with a $495 Early Termination Fee (ETF) and an annual PCI compliance fee of $125, both of which are automatically deducted from a merchant’s checking account. Additionally, the contract appears to automatically renew for successive one-year terms and is only cancellable within a small window of time before it renews. Merchants who choose to lease equipment may be subject to additional conditions and fees.
Appstar Financial Complaints & Service | D
We are currently able to locate over 70 negative reviews about Appstar Financial, many of which accuse the company of being a ripoff or a scam. The most common types of complaints that merchants have reported are uses of deceptive sales tactics by agents, constant telemarketing calls, nondisclosure of important fees prior to account setup (such as the ETF and PCI compliance fee), and holding of merchant funds. There are also complaints from former agents claiming mistreatment and being sent to bogus appointments with merchants.
Appstar Financial BBB Report | D (CPO Adjusted)
As of this review, Appstar Financial has maintained Better Business Bureau (BBB) accreditation since 2002 and an “A+” rating despite having 206 complaints filed within the last 36 months. Of the total, 109 are regarding problems with products and services, 56 with advertising and sales issues, 39 with billing and collection, and two split between delivery problems and guarantee and warranty issues. All but 19 of the complaints have been resolved to the merchant’s satisfaction, which may demonstrate Appstar’s desire to maintain a strong BBB rating. We have adjusted the BBB’s rating to “D” for the purposes of this review based on how our criteria would score the number and types of complaints.
Appstar Financial rates as a substandard merchant account provider according to our rating standards. The company scores poorly in this review due to unfriendly policies regarding cancellation of services and the associated Early Termination Fee as well as a high annual PCI Compliance fee. Additionally, the company is suffering from numerous complaints regarding deceptive sales tactics and aggressive telemarketing. Appstar can improve its rating by improving upon the areas that are adversely impacting its score and by eliminating future merchant complaints.
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