|Sales & Marketing|
|Costs & Contract|
|Complaints & Service|
Founded in 1997 and based in Lehi, Utah, ProPay (propay.com) is a merchant account provider that shares attributes of both a traditional credit card processor and services like PayPal, Stripe, 2Checkout, and Google Checkout. ProPay was acquired by TSYS in late 2012 and now operates under the ProPay name as “a TSYS Company.” Dave Duncan is the president of ProPay.
ProPay’s similarities with a traditional merchant account include the ability to swipe credit cards at the point of sale, which can result in a lower processing fee, as well as the ability to accept payments for other purposes such as e-commerce and mail order/telephone order sales. Unlike a traditional merchant services provider, ProPay does not support the use of desktop credit card terminals like the type used at most retailers. However, like PayPal and 2Checkout, ProPay has an easy signup process and is open to non-traditional merchants such as direct sellers and micro-merchants. Like PayPal, ProPay acts as its own holding account and merchants must manually transfer their money to a linked checking account.
ProPay offers several ways to accept credit card payments, including mobile options. The first, “ProPay Jak,” is a service similar to that of GoPayment, Square, and Pay Anywhere in which merchants can use a card reader with a smartphone to accept credit cards. However, unlike the other three options, ProPay Jak includes a variety of other services which are not offered by its competitors, such as access to a virtual terminal.
The second mobile option that ProPay offers uses a small skimming device called the “ProPay FLASH Card Reader” (formerly known as the MicroSecure Card Reader) which allows merchants to collect credit card data by swiping the card’s magnetic strip and storing it for later processing when the merchant has access to an internet-connected computer. Merchants can also use the ProPay FLASH device to process real-time sales through ProPay’s virtual terminal once the device is connected to the Internet. Lastly, ProPay offers an automated phone system where merchants can call in to process real-time sales.
ProPay Jak Video Introduction
ProPay Products and Services:
- Debit and credit card processing
- Online payment gateway
- Virtual terminal
- Mobile phone processing
- Online shopping cart
- QuickBooks integration
- Multi-currency support
- ACH processing
|Key Points – Sales & Marketing|
|Uses independent resellers?||No|
|Promotes deceptive rate quotes?||No|
|Discloses all important terms?||Yes|
ProPay does not use any deceptive marketing or sales tactics that are apparent to this reviewer. The entire signup process is handled in-house and on the company’s website. Additionally, ProPay’s displayed pricing is transparent and does not hide fees. We are not seeing any merchant complaints at this time that accuse the company of deceptive advertising strategies.
ProPay Marketing Example
|Key Points – Costs & Contract Terms|
|PCI compliance fee:||None|
ProPay offers an annual agreement with an annual fee but no monthly fees, monthly minimums, gateway fees, or statement fees. We are unable to determine at this time whether the company charges a cancellation fee for merchants who terminate their contracts early, but ProPay has not charged such a fee in the past. We also have not seen any complaints regarding a termination fee.
Since this review’s initial publication, ProPay has made it difficult to locate the pricing of all of its services on its website; however, the company offers simple processing fees with a single rate that is set by how the card is transacted (either typed-in or swiped through a card reader). For instance, the company’s “Merchant Account” page currently lists a fixed swiped rate of 2.60% and a fixed keyed-in rate of 3.40%, and we have found no merchant complaints indicating that these fees are deceptively quoted. One exception to this rate structure is American Express Cards, in which the rate is the same under both transaction types. Fees and rates also vary based on the account type the merchant chooses with ProPay. Additionally, ProPay can customize rates for high-volume businesses. This page appears to be ProPay’s current pricing for its merchant account options.
ProPay’s rates and fees are competitive with most traditional three-tier merchant account setups, and probably less expensive in many cases. However, ProPay is more expensive than Interchange Pass-through rate pricing.
|Key Points – Complaints & Service|
|Live customer support?||Yes|
|Most common complaint:||Fund holds|
ProPay has very few complaints for a company of its size, and most of these complaints were filed before 2014. Many of the complaints that it does have appear to be filed by merchants that have a limited understanding of how credit card processing fees are assessed and would experience the same issues with any provider.
The one common theme in the legitimate complaints filed against that company is that ProPay has a tendency to hold funds and freeze accounts if a merchant starts making charges that differ from its normal transaction history, or if the merchant suffers a chargeback. It some cases, it appears that ProPay will suddenly terminate an account without notice, thereby leaving the merchant without a way to accept credit cards. Understandably, these same merchants complain of receiving poor customer service.
ProPay appears to be very cautious about how much risk it is willing accept from a merchant, so higher risk businesses may want to look elsewhere. It is also wise to avoid chargebacks at all costs if you choose to go with ProPay.
Generally, we do not count complaints regarding fund holding against a providers unless there is a clear pattern of abuse or deception. It is a standard industry practice for providers to hold funds in the event they suspect high risk transactions or fraud. In ProPay’s case, it appears that it is operating within normal guidelines when choosing to hold funds. To learn more about fund holds, see this post: Why Credit Card Processors Hold Funds.
|Key Points – BBB Report|
As of this update, ProPay is accredited with the Better Business Bureau and holds an “A+” rating. The company has 34 reports filed in the last 36 months, which is unchanged from the time of our last review. Of the 34 complaints, 20 are due to problems with products and services, 12 to billing and collections disputes, and two have to do with advertising or sales issues. All complaints were resolved to the merchants’ satisfaction except two. We have adjusted the BBB‘s rating for the purposes of our review based on our own rating criteria. For more on why we adjust BBB ratings, please see our rating criteria.
* Denotes CPO-adjusted BBB score
This review was originally published on 10/14/10 and was last updated on 1/6/15.
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