Phone Swipe Review

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. Delayed payment and poor customer service tend to be mentioned in the same complaints, as merchants report 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.

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.

As of this update, Phone Swipe is not an accredited business with the Better Business Bureau. The company holds an “F” rating and has had 15 complaints filed against it in the last 36 months. Five of these were filed in relation to problems with the company’s product or service, eight were due to billing or collection disputes, one was related to an advertising or sales issue, and one had to do with delivery. The company resolved five complaints successfully, while five complaints either were resolved to the dissatisfaction of the merchant or did not receive a final response from the merchant. The remaining five complaints received no response whatsoever from Phone Swipe. The BBB cites these unaddressed 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 “D.”

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%. Merchants should determine which type of transaction they are more likely to process 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.

Due mostly to its affiliation with North American Bancard and its low BBB grade, Phone Swipe rates as an average merchant services provider according to our rating system. The company’s credit card processing service is showing a low complaint total at this time, and it appears that the most persistent issues are the company’s cash reserve policy and its customer service network.