Merchant Data Systems Review
UPDATE 8/14/21: The Merchant Data Systems website (merchantdatasystems.com) is no longer an active website. At one point it redirected to a website for “Company.com,” a business services provider whose services include payment processing. It is unclear whether Company.com acquired Merchant Data Systems or whether it is simply a rebranding of Merchant Data Systems, but the two entities appear to share the same management team. It appears that Merchant Data Systems is no longer an active credit card processing brand. We will therefore no longer update this review, and we plan to publish a review of Company.com soon.
Merchant Data Systems (merchantdatasystems.com) provides merchant accounts for retail, restaurant, and e-commerce businesses. The company also offers its own payment gateway as well as the First Data (now Fiserv) Global Gateway. Founded in 1997, Merchant Data Systems is headquartered at 1688 Meridian Ave Suite 802, Miami Beach, Florida 33139 and is sponsored by Wells Fargo Bank, N.A., Walnut Creek, California, and Deutsche Bank AG as its Acquiring Banks. The company’s president is Drew Freeman.
Merchant Data Systems Customer Reviews
Here's What Their Clients Say
|Total Online Complaints||10+|
|Live Customer Support||Yes|
|Most Common Complaint||Termination Fees|
Merchant Data Systems Customer Service
Approximately 10 Merchant Data Systems negative reviews have been registered on this and other consumer protection sites, some of which are old enough so as not to be of too much concern. Issues include excessive cancellation fees, holds placed on large transactions, poor customer service, difficulty in canceling accounts, and fraudulent charges. Merchant Data Systems has made an effort to respond to most complaints listed and to resolve any pending issues, including, in one particular case, a refund of a cancellation fee. Merchant Data’s site offers a dedicated email address and 24/7 customer service phone line.
Merchant Data Systems Online Ratings
Here's How They Rate Online
Online Ratings Summary
|Product & Service Complaints||0|
|Billing & Collection Complaints||0|
|Advertising & Sales Complaints||1|
|Guarantee & Warranty Complaints||0|
Note: We have adjusted this company’s BBB rating according to our own standards. To better understand why we adjust BBB ratings, please see our Rating Criteria.
Only One Complaint
Merchant Data Systems is an accredited business of the Better Business Bureau and currently maintains an “A+” rating with 1 complaint listed against the company, which was an issue with advertising or sales. The complaint either was resolved to the dissatisfaction of the merchant or did not receive a final response from the merchant.
What Merchants Say
Merchant Data Systems has also received 1 negative review to its BBB profile. The review describes an early termination fee and poor customer service:
Unethical contract terms and auto renewal that was never explained and never received the operating agreement. Stole $5400 from me Our small family run business has been with MDS since 2005. We had been happy with the service provided but in september of 2018, our company changed to a different point of sale software that integrated credit card processing into the sale. We no longer could use MDS, So i called to let them no i no longer needed their services. Fast foward to November and they just drafted $5400 out of my account. I called and spoke with *****, a supervisor, and he explained this was my early termination fee. Apparently back in 2014, my sales guy, *** **** was slick enough to slip in a piece of paper that in tiny print says that i have read and understand the 38 page MDS operating guide. *** never explained that there was any sort of 3 year contract and/or auto renewal. I’ve never even seen the “operating guide”. The only forms i was given via email was an application. So of course i signed what i perceived to be an application. When I called to cancel, the lady on the phone never mentioned anything about a termination fee. In my opinion, this is an unfair business practice. Clearly from reading other BBB and GOOGLE reviews…I am not alone in this thinking. Its a reminder that good will and common sense no longer prevail in our marketplace. I’m extremely discouraged and disappointed in ***** and my sales guy *** **** for knowingly deceiving myself and others like me.
This merchant would be better served by one of our top-rated processors.
A “B” Score
In light of these figures, we have adjusted the BBB’s rating to a “B.”
Merchant Data Systems Fees, Rates & Costs
A Closer Look at The Contract
|Early Termination Fee||$250+|
|PCI Compliance Fee||$99|
|Equipment Lease Terms||Variable|
Merchant Data Systems Contract
The standard Merchant Data Systems contract (available below) outlines a three-year term that automatically renews for another three years. On other consumer protection sites, some complaints have also reported $10 statement fees and annual fees (possibly PCI Compliance fees) of $99. These totals are consistent with industry averages.
If this Agreement is terminated by either party for any reason before the end of the then-current term, or if you or any of your Affiliates violate Section 17 hereof, you will immediately pay us, as a termination fee, the greater of (i) $250.00 for each year remaining in the then-current term or (ii) the fees (net of Association charges) we would have received based on the average monthly transaction volume during the highest 12-month period prior to termination (annualized in the event such period is less than 12 months) (or the fee we should have received, based on your representations in the Application, if greater) during the months remaining in the then-current term but for such termination.
An Expensive Option
In our opinion, this is an excessively complicated early termination fee that bears no relationship to the actual costs generated by a merchant’s cancellation. It therefore has the potential to be far more expensive than industry averages. Merchant Data’s use of independent sales agents might result in some variance among contracts, so merchants are encouraged to ask their sales agents which terms are negotiable and which are not. It is likely that each Merchant Data sales agent is cleared to alter the provisions of the standard contract to a certain extent. See the Merchant Data Systems Merchant Agreement.
Merchant Data Systems Employee Reviews & Sales Tacitcs
Should You Work For Them?
|Employs Independent Resellers||Yes|
|Advertises Deceptive Rates||No|
|Discloses All Important Terms||No|
Outside Sales Team
Merchant Data appears to hire independent sales agents to resell its services. This is a common industry practice that often results in an untrained, unregulated sales force. One theme among complaints found on this site and elsewhere has to do with Merchant Data sales agents agreeing at the point of signing to waive specific fees or provide low rates and then failing to follow through on these guarantees. In these cases, Merchant Data Systems usually refers merchants to their signed agreements. In light of this, merchants are encouraged to only do business with agents they trust. Merchant Data does not appear to engage in any deceptive marketing tactics in its official materials at this time.
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