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Founded in 2014, Magothy Payments is a merchant account provider that is capable of serving most standard-risk business types. The company is one of the most positively reviewed payment processors on CPO. Magothy Payments focuses on companies that require ‘card not present’ payment processing as well as businesses that utilize lots of reoccurring billing for services or membership. Magothy’s largest client base is contractors in home and commercial, but it also works with e-commerce companies, B2B, and other companies with recurring and card-on-file billing. Magothy Payments is also an Authorize.Net reseller.
Magothy Payments Payment Processing
Magothy Payments has started focusing on firearm businesses and gun merchants. Elavon is also rated as very friendly to 2nd Amendment companies. This allows Magothy Payments to offer lower swipe rates to merchants who are typically considered high-risk. As long as they have their federal firearms license, Magothy won’t charge any high-risk premiums.
Payment Gateway and Virtual Terminals
In addition to physical payment processing, Magothy Payments offers online payment solutions. This allows businesses to accept credit and debit card payments over the internet, providing the necessary infrastructure for e-commerce businesses, or brick-and-mortar businesses looking to expand online.
Commitment to Industry Reforms
Magothy Payments has dedicated a portion of its website to Maryland House Bill 777. The section details the company’s support of the legislation, which sought to reform practices contractually enforcing early termination fees and liquidated damages clauses in standard merchant agreements. The bill was signed into law in 2019 and took effect on October 1 of that year. Under the new law, the length of the contract, the cancellation fee(s), liquidated damages, contract renewal date must be apparent and written into a merchant agreement in 12-point bold font. Furthermore, the bill caps early termination fees at $500 for contracts signed on or renewed after October 1, 2019. The company’s advocacy on behalf of the passage of this law conveys its standard of ethics to prospective merchants considering their services.
Location & Ownership
Magothy Payments Pros and Cons
- Many Positive Reviews
- Contract Terms Can Lead to Saved Money
Table of Contents
Magothy Payments Customer Complaints & Reviews
Here's What Users Think
Total Online Complaints
Live Customer Support
Most Common Complaint
Clean Complaint Record
We are unable to locate any negative Magothy Payments reviews at this time, and there is no indication that the company is a ripoff or a scam. As noted above, there are many reviews of the company online, but they are unanimously positive. Most of these reviews are unverified, but we have no reason to suspect that any of them are fake. Clients generally praise the company’s transparency and proactive customer service. If you have your own Magothy Payments review to make, please do so in the comments below.
Magothy Payments Lawsuits and Fines
We have not found any outstanding class-action lawsuits or FTC complaints filed against Magothy Payments. Dissatisfied clients who wish to pursue a non-litigious course of action against the company should consider reporting it to the relevant supervisory organizations.
Magothy Payments Customer Support Options
Magothy offers live phone support to all of its clients. The positive reputation of its customer service department indicates that it is competitive with any of the top-rated payment processors for great customer service.
Magothy Payments Customer Service Number
- (855) 624-6849 – Toll-Free Support
Other Support Options
- Customer service email address at [email protected]
Magothy Payments BBB Rating and Report
Our Better Business Bureau Profile Assessment
No BBB Complaints
Magothy Payments currently has an “A+” rating with the Better Business Bureau and has been BBB-accredited since December 2016. The company has received 0 complaints in the last 34 months it has been active.
What Merchants Say
Magothy currently has no reviews on its profile, though it previously received 2 positive informal reviews. The most recent review was left by a client who describes the company’s effect on them being able to save on the cost of services:
Magothy Payments has saved me Thousands of Dollars a year. Super Helpful when it comes to customer service. If your not using Magothy Payments chances are you are probably being overcharged and cant even get them on the phone. Magothy has the best rates available (Trust me i looked around) and extremely professional. You wont find another company this good.
This review describes traits that embody the best available merchant account providers.
An “A” Performance
Given the company’s clean complaint record, we agree with the BBB’s rating at this time.
Magothy Payments Fees and Rates
A Closer Look at the Contract
Monthly & Annual Fees
Interchange + 0.50% + $0.10
The standard Magothy Payments merchant agreement is a month-to-month contract through Elavon with no early termination fee, a monthly minimum fee of $10, a PCI non-compliance fee of $75 (It should be noted Magothy covers this fee for most of its clients, effectively making it a 0$ cost for noncompliance), a monthly statement/support fee of $10, and a per-transaction fee of $0.10 (interchange-plus 0.75% plus $0.10 for American Express cards). Magothy Payments also caps its chargeback fee at 99$ per year, with all chargebacks automatically notified to merchants.
Virtual Terminal and Payment Gateway Pricing
In addition to its storefront payment processing services, Magothy Payments also dedicates a portion of its website to advertising its virtual terminal and payment gateway, powered by NMI. NMI does not disclose pricing on its services but Magothy Payments’ standard contract lists a gateway fee of $15/mo + 10 cents per transaction. Additional rates and fees, technical support fees, batch fees, and additional transaction rates typically apply to these e-commerce services.
Other Magothy Fees
Magothy Payments fees include a one-time setup fee of $249, but this can be lowered to $99 for new owner-operator businesses. This fee covers payment gateway customization, reporting tool setup, PCI compliance assistance, and employee training. Clients who are dissatisfied with the company’s service after one billing cycle can request a full refund of this setup fee, although a company representative has stated that this has never occurred. Magothy Payments caps its chargeback fee at 99$ per year, with all chargebacks automatically notified to merchants.
Magothy PCI Compliance Fee
Magothy’s PCI compliance fee varies according to each merchant’s payment solution and level of liability coverage. This fee is charged monthly and can total either $8 ($100,000 in coverage) or $12 ($250,000 in coverage) for physical terminals or $7 ($20,000 in coverage) for e-commerce or MOTO solutions. In addition, the company prefers to sell rather than lease terminals, but it will provide clients with leased equipment if they request an equipment lease. In almost all cases, we advise business owners to purchase equipment outright rather than sign an equipment lease.
Alternate Pricing Options
Magothy offers custom pricing for high-volume businesses. The company also guarantees in its contract that their interchange-plus markup will never increase and offers a follow-up analysis after one month of processing with each client to determine whether it did in fact lower the client’s effective rate. A company representative has stated that Magothy Payments does not offer tiered pricing.
Worth The Cost
We often recommend against signing up for some of these fees, such as statement fees, annual fees, and setup fees, but Magothy Payments appears to genuinely attempt to offset its fee structure with high savings and quality support. We are unable to locate any client complaints that mention excessive charges or unreasonable contract terms from the company. In fact, the available Magothy Payments reviews that mention pricing praise the competitiveness of the company’s prices and the savings they’ve seen through the company. The overwhelmingly positive consensus among merchants has earned Magothy an “A” rating in this category.
We also encourage business owners to check out our list of the providers of the best merchant accounts.
Magothy Payments Jobs and Employment
Hiring Standards and Ethical Marketing Assessment
Uses Independent Resellers
Discloses All Important Terms
Inside/Outside Sales Team
Magothy Payments appears to primarily rely on referrals and networking to advertise its services. It employs W-2 and 1099 sales agents but requires its 1099 sales agents to comply with the company’s pricing guidelines. We are currently unable to locate any Magothy Payments reviews that accuse the company of nondisclosure or misrepresentation. In fact, there are a large number of positive testimonials about the company’s honesty and transparency.
This compares favorably to our list of best credit card processors.
No Deceptive Quotes
Magothy Payments prominently advertises that it offers interchange-plus pricing and does not enforce long-term contracts or early termination fees. The company’s owner has reinforced those claims by leading the charge to pass legislation in the state of Maryland that requires the client’s initials next to all major contract terms and caps all merchant cancellation fees at a total of $500. The full text of the bill, which takes effect in October 2019, can be seen here. In combination with the lack of complaints and a large number of positive merchant reviews, this is a strong indication that Magothy Payments is committed to fair dealing and honest sales practices.
If you suspect, however, that the company is overcharging you, then you can double-check your monthly bill with a third-party statement audit.