Payment Alliance International (PAI) Review

We are currently able to locate over 30 Payment Alliance International complaints on this and other consumer protection websites, and some of these complaints accuse the company of being a scam or a ripoff. Common complaints include unauthorized or unexpected withholding of funds, undisclosed fees, difficulty canceling the account, and poor customer service. Additionally, a handful of the company’s complaints appear to be the result of a mail scam in which a foreign entity was using the Payment Alliance International name without the company’s knowledge. The company has taken steps to alert merchants to this scam and appears to be blameless in the situation.

Overall, the most common issue among Payment Alliance International clients appears to be confusion over the company’s fraud prevention policies. Since Payment Alliance International offers high-risk merchant accounts to businesses that otherwise might not qualify for merchant services, these complaints are to be expected to a certain degree. Still, it seems as if the company could prevent some of these complaints by explaining its reserve account policies to new merchants in greater detail. We have also seen a recent increase in complaints related to undisclosed fees that persist after cancellation, which is a trend worth monitoring. It should be noted that some complaints about Payment Alliance International may be redirected to Clearent now that Clearent is servicing the company’s previous accounts.

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 review, Payment Alliance International has an “A+” rating with the Better Business Bureau with 0 complaints filed in the last 36 months.

There are also BBB profiles for what appear to be independent sales offices of PAI in Elmhurst, Illinois; Palm Beach, Florida; Pueblo, Colorado; Orlando, Florida; Jackson, Mississippi; and Newark, New Jersey. We will disregard these profiles for the purposes of this review, but it should be noted that they have varying complaint records and BBB grades.

The standard Payment Alliance International contract (available below) is a three-year agreement through Global Payments with automatic one-year renewal, a Liquidated Damagesearly termination fee, and a variable PCI Compliance fee, monthly minimum fee, annual fee, and statement fee. The company’s ATM processing agreement (available here) also includes a Liquidated Damages early termination fee that is to cost no less than $650.

Now that PAI’s merchant services division is owned by Clearent, it’s possible that the company’s merchants have received modified contract terms under the new ownership.

Payment Alliance International’s early termination fee is calculated in an uncommon way. According to the contract, “the following amount(s) shall be immediately due and payable to Global Direct and/or PAI: the lesser of (a) the maximum amount permitted by state law, and (b) all monthly fees assessed to Merchant under this Card Services Agreement and due to Global Direct and/or PAI for the remainder of the then existing term of the Card Services Agreement, including all minimum monthly fee commitments.” So, upon early termination, merchants can expect to either pay out the remainder of their contracts with Payment Alliance International or pay the maximum fee allowable by state law, but they will only pay the smaller amount of the two. This fee appears to have the potential to be either very large or very small, but at the very least, it does not appear to be tied to any real measurement of the company’s losses as a result of merchant termination. The company’s ATM agreement includes a similar early termination fee, but it takes the larger of the two terms listed.

These terms would normally merit an “F” rating in this category, but there do not appear to be any Payment Alliance International complaints online that mention the company’s early termination fees as a major issue. It may be that many of the complaints reporting large amounts withheld after cancellation are the result of the company pulling this early termination fee from the merchants’ reserve accounts, but it’s unclear at this time whether this is occurring. We cannot determine at this time why these fees have yet to impact merchants severely enough to prompt them to file a public complaint, but we will factor the lack of complaints into the company’s score. If you have any knowledge of how this liquidated damages clause is enforced, please share that information in the comment section of this review. See the Payment Alliance International Merchant Agreement.

Payment Alliance International rates as an average merchant account provider according to all available information. The company’s early termination fee is a major cause for concern, yet it does not appear to impact merchants as severely as it should. Similarly, the company’s hiring practices have a high potential for merchant complaints, but they appear to be yielding very few. The company’s overall rating is buoyed by its high BBB score.