|Sales & Marketing|
|Costs & Contract|
|Complaints & Service|
Phone Swipe (phoneswipe.com) is a mobile payment processing service provided by North American Bancard. Created in 2007, Phone Swipe allows merchants and individuals to accept credit and debit card payments via their Android phone, iPhone, or iPad using a small card-reading device. Phone Swipe is a registered ISO/MSP of Wells Fargo Bank, N.A. Walnut Creek, California, and is located at 111 North Harbor Blvd. #2, Fullerton, California 92832. The president and CEO of North American Bancard is Marc Gardner.
|Phone Swipe Features||Industries Served|
|Key Points – Sales & Marketing|
|Uses independent resellers?||Yes|
|Promotes deceptive rate quotes?||No|
|Discloses all important terms?||No|
Phone Swipe appears to primarily market its service through its website and online promotion. At this time, the company does not appear to employ independent sales agents, although it does allow sales organizations to resell it as their mobile payment solutions. We are currently able to locate a handful of Phone Swipe reviews that describe nondisclosure of fees by the company’s sales team. The Phone Swipe website advertises a swiped transaction fee of 2.69% and a keyed transaction fee of 3.49% plus $0.19, and there are no merchant complaints online that challenge these rate quotes, although vaguely described “hidden fees” have been mentioned in complaints.
The Phone Swipe website advertises a free terminal placement program for merchants who process over $10,000 per month. This $10,000 minimum is only described in the fine print of the page, and there is no mention anywhere of the additional costs listed in this full version of the company’s terminal placement agreement. The full agreement mentions that merchants whose monthly volume falls below $10,000 will be subject to monthly fees, which range from $19 to $99, and all merchants in the program will be charged an annual software license fee of $79. Failure to mention this information on the company’s website, which includes prominently placed signup forms, is a slightly misleading sales tactic in our opinion.
|Key Points – Costs & Contract Terms|
|Keyed-in rate:||3.49% + $0.19|
|PCI compliance fee:||None|
Phone Swipe offers a service that is similar to Square and other smartphone-compatible processors. The company advertises no long-term service agreements, early termination fees, PCI Compliance fees, or minimum monthly fees, but we have seen complaints alleging that the company actually does charge monthly minimum fees and an early termination fee. All swiped transactions are processed at 2.69%, and all card-not-present transactions are processed at 3.49% plus $0.19. Merchants should determine which type of transaction they are more likely to require when deciding whether to use Phone Swipe.
The majority of the complaints filed against Phone Swipe appear to be the product of the company’s fraud prevention policies. Like Square, Phone Swipe reserves the right to withhold merchant funds at its discretion to establish a cash reserve. Some merchants report surprise upon learning that a large portion of their payments have been withheld without notification, and they further express difficulty resolving the issue in a timely fashion through Phone Swipe’s customer service department. The Phone Swipe website claims that it differentiates itself from Square by having an automated underwriting process (as opposed to Square’s lack of underwriting), but the service still seems to be plagued by the same complaints.
|Key Points – Complaints & Service|
|Live customer support:||Yes|
|Most common complaint:||Hidden fees|
We are currently able to locate over 20 Phone Swipe complaints on this and other consumer protection websites, some of which accuse the service of being a ripoff or a scam. Common complaints include delayed or withheld funds, poor customer service, undisclosed fees, and problems with the app itself related to a software update. The two most common complaints of delayed payment and poor customer service tend to be mentioned in the same complaints, as merchants report great difficulty reaching representatives and having their funds delivered to them in a timely fashion. The company’s website offers a dedicated phone support number and email address, and these lines appear to be serviced by North American Bancard.
|Key Points – BBB Report|
As of this update, Phone Swipe is not an accredited business with the Better Business Bureau. The company holds a, “F” rating and has had 14 complaints filed against it in the last 36 months. Eight of these were filed in relation to problems with the company’s product or service, four were due to billing or collection disputes, and two were related to advertising or sales issues. The company resolved 10 complaints successfully, while one complaint was resolved to the dissatisfaction of the merchant and three received no resolution whatsoever. The BBB cites these three unresolved complaints as the primary factors lowering the company’s grade. Given the company’s complaint total and resolution ratio, we have adjusted the BBB’s rating to a “C.”
* Denotes CPO-adjusted BBB score
Related: Best Processors For E-Commerce
This review was originally published on 3/11/13 and was last updated on 4/17/15.
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