Contrary to popular belief, Authorize.net is not a merchant account provider or a credit card processor. Instead, Authorize.net is what is known in the merchant services industry as a “payment gateway provider.” This means that the company provides software and applications that route credit card payments from the point of sale to the actual credit card processor. Payment gateway providers like Authorize.net are an additional but necessary service if a merchant wishes to use a virtual terminal, website shopping cart, or some mobile processing applications.
Related: Authorize.net Competitors
Authorize.net is one of the biggest and most well-known payment gateway providers in the credit card processing industry and supplies several different services. One such service is the the company’s own virtual terminal, which turns any Internet-connected computer into a credit card processing terminal. Unlike most virtual terminals, Authorize.net’s can be used in conjunction with a USB card reader which allows merchants to take advantage of lower processing rates by swiping the credit card. Along with the virtual terminal, one of the company’s most popular services is a secured, hosted, and PCI compliant shopping cart. The hosted shopping cart allows merchants to easily sell through their websites by inserting “Buy Now,” “Add to Cart,” and “Checkout” buttons without going through the hassle of setting up their own self-hosted shopping cart. Merchants that have a large product selection and need a robust shopping cart can use Authorize.net’s API to access the payment gateway service, which is compatible with nearly all well-known shopping cart packages. Along with all of this, the company partners with several third party applications to provide a variety of other electronic payment solutions.
|Key Points – Sales & Marketing|
|Uses independent resellers?||Yes|
|Promotes deceptive rate quotes?||No|
|Discloses all important terms?||Yes|
Authorize.net’s website provides the suggested retail price of its services, and it clearly states that resellers may alter the costs as they see fit. The company’s pricing breakdown is complete with explanations of each term and is easy to access from the main page. Because Authorize.net’s services are resold by a huge number of merchants, the figures provided on its actual site are subject to change, but the company is being helpful by offering a suggested cost for merchants to use in potential negotiations and is therefore awarded an “A.”
Authorize.Net Marketing Example
|Key Points – Costs & Contract Terms|
|PCI compliance fee:||None|
Authorize.net quotes pricing on its website of a $99 setup fee, $20 monthly gateway fee, $0.10 per transaction fee and $0.25 batch fee. However, pricing may vary widely based on the reseller because resellers can set prices as they please. Due to this, pricing is very negotiable and many of the fees can be greatly reduced or eliminated. Many of the complaints filed publicly against the company (some of which are in the comments section below) report confusion over the the fact that a third-party reseller was actually offering the services of Authorize.net even though the merchant was under the impression that the reseller itself was providing a payment gateway. While these problems are unrelated to the actual Authorize.net contract, it is worth noting that contract terms can vary, and resellers are not obligated to disclose which figures they have altered from the original suggested retail price.
|Key Points – Complaints & Service|
|Live customer support:||Yes|
|Most common complaint:||Poor service|
Authorize.net offers an FAQ/troubleshooting-type customer support page on its website, and it also lists an email address and an 877 number for merchant support. It makes some mention of online chat support, but it is not clear how one might access the online chat service.
The company has a few dozen complaints on consumer protection websites like Ripoff Report, with most of these complaints due to poor customer service, feature malfunctions, billing disputes, or unexpected charges. It was also apparent that several merchants were confused about the fact that Authorize.net was not the same company as their credit card processor. These complainants were unsure which company was to blame for the problems they were having. This confusion can usually be traced back to resellers who did a poor job of explaining the relationship between the credit card processor and the Authorize.net payment gateway.
|Key Points – BBB Report|
Authorize.net has a moderate amount of complaints for its size and time in business. As of this review, the Better Business Bureau (BBB) is giving Authorize.net a rating of “A+” despite the company having 187 complaints filed within the last 36 months, which is slightly up from 181 complaints as of the last update of this review. Of the complaints, 118 are due to billing and collection issues, 51 are regarding problems with products and services, 14 have to do with with advertising and sales issues, and four are related to delivery issues. Almost all of the complaints have been resolved with BBB assistance, but 17 left the merchants dissatisfied with the company’s response. The moderate complaint rate is mitigated somewhat by the strong record of satisfactory responses, resulting in a CPO-adjusted rating of “B-.” To understand why we adjust BBB ratings, please see our Rating Criteria.
Overall, Authorize.net has a decent rating as a payment gateway provider. The company provides an easy way for merchants to accept credit cards using just their computers and through their websites, and Authorize.net is widely accepted as one of the best gateway providers in the merchant services industry. Despite several complaints by unhappy merchants, the majority of the company’s customers appear to be satisfied with its services.
It is evident by the type of complaints that Authorize.net has received that the company could stand to improve upon its customer service and reseller training. Merchants are advised to negotiate rates and fees and to thoroughly read the agreement before signing.
This review was originally published on 4/8/11 and was last updated on 8/21/14.
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