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Merchant account...rejected

Discussion in 'Business Technology' started by Srini Ranganathan, 27th Sep, 2016.

  1. Srini Ranganathan

    Srini Ranganathan Active Member

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    Hi all,

    We are a startup business selling wholesale and retail.

    Considering accepting both eWay and PayPal through the retail website and bank deposits for wholesale.

    eWay required us to setup a merchant facility with Westpac. So, we moved our business banking to Westpac over the weekend. This morning, I got a note from Westpac saying they've rejected the merchant facility application and we may apply after 6 months.

    Reading about this online shows its a common issue for start-ups and once you get rejected a few times, its really hard to get a merchant facility with any bank (a bit like credit risk assessment I think).

    The weird thing is, they did not ask for any supporting docs at all, not even business plans.

    PayPal is straight forward and don't need a merchant facility. So, we can keep going with that while we kick start the business and build a trading history, but thought it may be worth posting in this forum.

    Any ideas or pointers would be much appreciated.
     
  2. Kinnon

    Kinnon Member

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    How clean is your credit history as they do do a credit check?
     
  3. Simon Hampel

    Simon Hampel Founder Staff Member

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    Why did eWay require you to set up a merchant facility with Westpac?

    I've had three separate merchant facilities with them and it's never been a requirement to use a specific bank.

    Last time I set up an eWay account (June last year), I used their all-in-one facility which uses NAB as the bank-end merchant facility, but I didn't have to explicitly apply for that - they did it for me (previously it was a two step process, first apply for NAB merchant facility and then link it with eWay merchant gateway).
     
  4. Srini Ranganathan

    Srini Ranganathan Active Member

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    Credit history is squeaky clean.

    eWay has moved their relationship from NAB to Westpac. When I tried to get setup on eWay, they put me through on the phone to Westpac.
     
  5. Simon Hampel

    Simon Hampel Founder Staff Member

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    Looks like the new owners are shaking things up a bit.

    If they try and pull something like that with me when I go to set something new up shortly I guess I'll be going with Stripe instead.

    I have no intention of doing business with Westpac.
     
  6. Simon Hampel

    Simon Hampel Founder Staff Member

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    Did Westpac give a reason why they've rejected your application?

    Go back to eWay and ask them what's going on - if eWay want your business, they need to do some work for it.

    Otherwise, look at Braintree or Stripe.
     
  7. Srini Ranganathan

    Srini Ranganathan Active Member

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    Agree Sim.

    Westpac gave me their blanket "bank policy" line and eWay quickly washed their hands off of it.

    I'm now considering Braintree and Stripe. I'm not sure if they need merchant accounts as well or they follow the PayPal model.

    Will ring and post back tomorrow.

    You may have better results Sim as you've been trading for a while.
     
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  8. Kinnon

    Kinnon Member

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    I set up a stripe account for a simple online cart and all I needed to do was provide my BSB and account number and at the end of each day they settle and transfer the funds into my account.
     
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  9. Simon Hampel

    Simon Hampel Founder Staff Member

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    For InvestChat, yes (where we ironically did have an eWay+NAB merchant facility until a few years back before we decided to cancel it because we weren't using it and it was just costing us money) ... but I'll also need one for BusinessChat soon enough. No rush on that one and I can always use the merchant facility from my consulting company if I really have to (although that's not as ideal since transactions will be listed as coming from a different company, which can cause confusion).

    At the end of the day, if eWay's new owners aren't interested in maintaining their competitive differences, there's no longer any compelling reason for us to stick with them and we'll be better off with something like Stripe.
     
  10. Srini Ranganathan

    Srini Ranganathan Active Member

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    Thanks for that Kinnon. How do you find Stripe in terms of service? Their contract says 7 day settlement and a $25 fee for chargebacks.

    Not sure if I need to worry about chargebacks and settlement duration this early in the business, but may become potential issues down the line.
     
  11. Kinnon

    Kinnon Member

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    I've never had to contact them for anything so can't say how their service is but as far as their product offerings I found it to be good. Not sure about the 7 day settlement though, pretty sure it's same day settlement with transfer to account on a 2 day rolling basis. That chargeback amount is pretty standard across the industry.

    The volume going through my website at the moment is pretty low as I'm still in the process of setting it up but plan on ramping it up in the next month so the true test will be then.
     
  12. Srini Ranganathan

    Srini Ranganathan Active Member

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    Great to hear. Thanks Kinnon and all the best with the growth.
     
  13. arrowwise

    arrowwise Active Member

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    We setup new merchant account with CBA / Eway last year. No issues and they didn't refer us to another bank. Getting the AMEX facility was easy / better direct through them than direct with AMEX.

    A company like Eway shouldn't be aligned to any bank.

    Eway is a much better solution than Securepay which lacks a lot of features and flexibility.
     
  14. Simon Hampel

    Simon Hampel Founder Staff Member

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    Did you set up a merchant facility with CBA first and then get eWay to set up your gateway, or did you get eWay to set up the CBA stuff for you?

    Before eWay set up their all-in-one product, you could get eWay to initiate contact with your bank of choice on your behalf but then the application was all handled by the bank and your relationship was with them directly (and you paid the bank directly for the merchant facility) - eWay just provided the gateway.

    This is what I had when I got my merchant facility for my consulting company (back in 2009 it was set up) - I applied to eWay and asked them to initiate contact with NAB on my behalf, which they did - so I have a NAB merchant facility (which I pay a monthly fee to NAB for) as well as an eWay gateway facility which links to it (which I pay a fee to eWay for).

    The promise with the all-in-one product they set up to compete with Stripe and Braintree was that they would do all the work for you, the merchant facility application and provisioning would be transparent and you wouldn't be billed directly by the bank (you just paid eWay for both the gateway and the merchant facility). The merchant facility was provided by NAB - but you didn't pay anything for it to them directly.

    This is what I had when I got my all-in-one merchant facility for PropertyChat last year - eWay did it all for me. I still ended up with a NAB merchant facility (and there was an approval process by NAB which was transparent in that I didn't have to supply any data directly to them) - but the communication was all handled by eWay and I just get a monthly statement from NAB showing merchant facility transactions but no fees paid to NAB (and eWay just take a fixed percentage of the transaction costs).
     
  15. Srini Ranganathan

    Srini Ranganathan Active Member

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    In my recent experience, this is not how eWay operate any more.

    I spoke with Braintree today and they are a one-stop shop similar to Stripe and can handle the payments for us.
     
  16. Simon Hampel

    Simon Hampel Founder Staff Member

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    Last time I looked, Braintree were using NAB as their back-end merchant facility too.
     
  17. Srini Ranganathan

    Srini Ranganathan Active Member

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    When I asked them whether I'll need to get a merchant account, they said they are a "master processor" and that I don't need a separate merchant account. I'll post back once I have everything setup.
     
  18. Simon Hampel

    Simon Hampel Founder Staff Member

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    Yes, my understanding is that they use NAB transparently in the background.

    I actually read yesterday that Stripe also use NAB in Australia.
     
  19. Srini Ranganathan

    Srini Ranganathan Active Member

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    Got an approval from Braintree this week. They go through a merchant account setup process and underwriting as well.

    Just sent all the trust deeds, website link and bank statements. Took a few days, but all setup now.

    Thought I'd update this thread. My devs have included Braintree checkout on the test site as well. Didn't take long to do.
     
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  20. Simon Hampel

    Simon Hampel Founder Staff Member

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    Was there a particular reason you ended up going with Braintree vs Stripe?

    I'll need to make a similar decision for two of my new businesses shortly.