hi guys

say you decide to start company abc

with a friend

your friend already has a merchant acct under name xyz

your friend insists that we just bill people under xyz

is there anythign really wrong with that?

i just dont know if we should because i think it wont look right

and xyz shouldnt really have anything to do with it

also

how would i bill people with CC's under my company ABC

so every month if i get 50 orders who signed up wtih a CC
i would want it so the money goes into my bank account

how would that work out? What place could i goto to sign up for that?

Hello,

In my opinion it's not a good idea to "mingle" funds. If the merchant account will not have any other additions of funds from sources other than yours I think it would be fine though.

Also, If you do end up billing using the other merchant account, It would be wise to notify users on the order form that the charge will appear as xyz.

Joel Strellner

What you are refering to in the second portion of your post is a merchant account. You can obtain a merchant account at many financial institutions like your bank.

I suggest you search for "merchant account" at google.com for some more information. Also to get a merchant account bearing the name of abc you will need to get a dba.

dba =

Originally posted by clocker1996
dba =

dba = Doing Business As

you can obtain a dba and get information at your local city hall (sometimes called other things). To my knowledge it can only be issued by your local government.

It will cost a small fee; varies from city to city.

Joel Strellner

Greetings:

Here are the problems that could realistically occur:

1. You could have higher chargebacks than normal because a customer would check their statement and have no clue about the company listed because it is not you.

They may also have a greater chance to win chargebacks because they can claim the company listed never provided any services or products; since they are telling the truth....

2. Either company could get involved in a legal suit that would require an audit. Such an audit may provide information about the other party that is not relevant, but must be disclosed.

For instance, the new company gets into legal issues, and now the other company under which the credit cards are put through now has to go through an audit. And vice versa. Can of worms.

3. Audits by the IRS and any other parties become complicated, and can be costly.

4. If you ever go to get funding from VC's, they may have a mess of a time resolving your financials which may mean they back out.

Thank you.

hey

keep things seperate.. thats my belief.. never mix to things that are totally unrelated together... the other thing is, never mix friends with business.. never a good idea... if you do, let the friendship be friendship and business be business... let the two exist independently...

as for your problem.. i would definately recommend getting your own merchant account.. if you dont have the funds, use a third party processor.. but keep it seperate.. OR ask your friend to transfer the merchant account ownership under your new company...

its just easier to handle seperate identies rather then merged ones.

kunal

how can i get my own merchant acccount?

could this be something i could get online....?

clocker, there are a lot of merchant account providers out there... you would need to have a registered company though... is your company registered? also, where are you located?

north america (canada)

and i will be getting a business license this week.

Originally posted by clocker1996
north america (canada)

and i will be getting a business license this week.


GREAT!! that means you have a looooot of options... a lot of people highly recommend going with a authorize.net merchant...

but you could check out sfcommerce.com or echo-inc.com... i havnet persoinally used any...

i user worldpay since i am from india... searching these forums should bring up some more options, plus user comments... the search link is at the top right hand side! :)

kunal

Originally posted by dynamicnet
Greetings:
They may also have a greater chance to win chargebacks because they can claim the company listed never provided any services or products; since they are telling the truth....



are you saying that people could buy, and then use it for 30 days, and then charge back, and say that?

Originally posted by clocker1996


are you saying that people could buy, and then use it for 30 days, and then charge back, and say that?


yup.. thats very true... crazy i know... but its true... they could do a chargeback even after using your service for 6mths :rolleyes:

Originally posted by kunal
yup.. thats very true... crazy i know... but its true... they could do a chargeback even after using your service for 6mths :rolleyes:

Actually through visa and mastercard you have a maximum of 90 days to file a dispute on a charge and you may be held liable for the first $50.00 of the charge.

Sorry, I used to work for a credit card issuer and still have this stuff imbedded into my single cell I call a brain.

Originally posted by xerocity.com


Actually through visa and mastercard you have a maximum of 90 days to file a dispute on a charge and you may be held liable for the first $50.00 of the charge.

Sorry, I used to work for a credit card issuer and still have this stuff imbedded into my single cell I call a brain.

hmm.. thats strange.. i dont revecom knows about this... hmmmmmmmmmmmmmmmmmmmm

:angry:

Greetings:

Yes, I am stating they could buy, use the service for a period of time; then within the credit card rules (90 days has been stated) do a chargeback.

What could you do about it?

The company doing the charging of their card provided them with zero products or services.

The company doing the charging has no direct relationship with the client, and the client did not agree to do business with them.

If you have a contract, the contract will most likely be between you and the client. And not involve the company with the merchant account.

Chargebacks not only take the money out of the bank account of the company that did the charging, but also involve a penalty fee. Futhermore, enough charge backs mean higher discount rates so you pay more for all sales.

Bottom line: Get your own merchant account in the new company name and save yourselves hassles.

Thank you.

Originally posted by xerocity.com
Actually through visa and mastercard you have a maximum of 90 days to file a dispute on a charge and you may be held liable for the first $50.00 of the charge.

To elucidate further: While the customer is required to file a dispute within 90 days, the credit card issuer often takes much longer than that before informing the merchant in question. In a recent case in which I was involved, I disputed a charge after about 40 days but it took over two months after that before Mastercard contacted the merchant. (For those of you with long memories, this was the "gamer.uk.com shipped the wrong game" issue.) So while the customer is required to file a chargeback within 90 days, you might only find out about it well beyond that deadline.

As for the $50 issue... almost all card issuers have dropped this now.

Originally posted by clocker1996
your friend already has a merchant acct under name xyz

your friend insists that we just bill people under xyz

is there anythign really wrong with that?

It might be illegal. Most merchant agreements specifically forbid the issuing of charges on behalf of third parties.

Originally posted by cperciva
As for the $50 issue... almost all card issuers have dropped this now.

True, the company I worked for did not charge this either, but it was in writing on all of their chargeback forms.

Also, I've personally seen it take upto 6 months to get a chargeback completely resolved.