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Thread: Authorize.Net?

  1. #1
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    Authorize.Net?

    Ever since CybexHost was created, we have been using 2CheckOut (2CO). At the time of our creation, 2CO was the cheapest solution for us. We have recently been given the opportunity to have a Free Authorize.Net Account, with a Free 250 Transactions Per Month, and $12.50 / Month per 250 there after. The question I pose is for current Authorize.net customers, especially those who have experience with both Authorize.net AND 2CO. I would like to know the pro's and con's of Authorize.net, and especially why those who moved from 2CO to Authorize.net. Any help would be greatly appreciated. Thanks in Advance.

  2. #2
    2CO is a third party processor, while Authorize.net is a GATEWAY for your own merchant account. There are many merchant accounts providers that use the Authorize.net gateway to process their transactions. CDGCommerce being one of the best out there, and having very good deals for WHT members (http://www.cdgcommerce.com/wht/) you can't really go wrong.

    The main difference you will notice is control. You will have much better control over your transactions. Partial refunds, recurring billing, batch billing, etc. You will also have your company name show up on your client's statements rather than 2CHECKOUT.

    Feel free to post any further questions, and I (along with many others, I'm sure) will do my best to help out.
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  3. #3
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    2.65% of each transaction must go to CDG Commerce?

    Wow, that's a lot.

    Then, Monthly Fees?

  4. #4
    It's actually, 2.30% plus $0.35 per transaction

    Monthly Fees = $25.00
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  5. #5
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    That is way too much, thank you for your time. I guess I will just stick with 2CO.

  6. #6
    How much are you processing per month. If you are processing over $1000, it is actually cheaper (usually) to get your own merchant account.
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  7. #7
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    CDG is much better than 2CO. 2CO not only takes forever to respond to problems, they are a 3PP, and not a gateway.

    CDG is 25 dollars a month, thats about the cheapest mechant account ever. (Plus the tax stuff)

  8. #8
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    Can anyone name some more merchant account companies than CDG? Preferably cheaper ones.....?

  9. #9
    I know Corey at Merchant Accounts for Less who is a reseller for Cardservice. We have a number of accounts thru him and have referred quite a number of associates and family members over to him. I am getting about 2.05% but it depends on your volume. I have been extremely happy with Cardservcice's service and Corey's company.

    We have used authorize.net before and were extremely unhappy with them. We contacted a few people that were active on this board and Corey was the only one to contact us. I personally have been extremely satisfied with the support he has provided and the extras that he has allowed us to use.

  10. #10
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    I will look into http://www.merchantaccounts4less.com/

    Thank You.

    Any other suggestions?

  11. #11
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    There are many factors to consider on a merchant account beyond price - but even on the price component... keep in the mind that there are some important factors to consider to understand the full effective cost on an account.

    A qualified discount rate is just one line item. You also have to take into account any mid-qualified or non-qualified fees that exist. These transaction tiers apply for specific types of transactions.

    And various processors can also mandate different qualifications for you to be billed on these tiers. Some processors will bill out the qualified rate if AVS is used regardless of the result - others will "downgrade" the transaction if it is NOT a total match.

    Some will lump the majority of transactions on the qualified level - which saves merchants a -substantial- amount of money.

    Others will downgrade a large % of the transactions to the higher cost brackets, costing them quite a bit more.

    In addition - the difference between a processor that has a two tier billing structure and one with three billing tiers can be substantial when it comes to your effective cost at the end of the day.

    So when you investigate the -price- aspect of a merchant account, ask how these billing tiers are handled and ask what % of a typical Internet merchant's transactions fall into the various tiers.

    Again though... the price of a merchant account on paper is just one aspect of it. I always liken it to the heart surgeon analogy.

    If you were looking for a heart surgeon to perform a complex surgery, would you seek the one with the lowest co-pay or look for the one with the most experience doing your specific kind of surgery.

    The same should be true for merchant accounts... there are a number of good options on the market - just make sure to do your due diligence, ask a lot of questions and then pick the company you feel most comfortable with.
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  12. #12
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    By time the Merchant Account Charges, and the Gateway Charges, and everything else adds up - it gets to be the about same as 2CO. So why change?

  13. #13
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    Thanks for the support topguy.

    John - you say - why change? If you are processing only 40 transactions a month at just $100, you end up paying 2CO about $238 a month . This is 5.95% of your profit. If you had a merchant account say at 2.45% and a transaction rate of .30, you would be paying about $110 a month with an extra $20 for the gateway / customer service / statement fee) which is about 3.25% of your profit.

    Even 40 transactions at $20 is 7.75% with 2Co and 6.58% - so depending your sales, it might not be worth switching. If you could get the transaction rate down to $.20, now you are at 6.08%. Yes - your percentages are not that great for lower volume unfortunately.

    Do your homework - what is your average ticket & average sale? It might not be worth switching but then agian it might be. Plus with a merchant account - your money is deposited usually within 24-48 hours. And now you are earning interest on your money & not 2CO.

    If you are happy processing with 2CO- stay with them. There is no reason to change.

    One thing to keep in mind - you still would need a processor if you chose the Free Authorize account. And looking at their site - they list 2.40% & $.30 transaction. Keep in mind - if this is for your web hosting services - it might even be more. TMS has a habit of trying to sign people up & then charging them more because their underwriter says they are high risk. What is high risk to one processor is not to another. Each one is different.

  14. #14
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    Originally posted by coreybryant
    Plus with a merchant account - your money is deposited usually within 24-48 hours. And now you are earning interest on your money & not 2CO.
    How much interest do you earn in a Merchant Account?

  15. #15
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    You don't earn interest. Let's say that you hav one transaction a day at $100.00. If you use 2CO or another processor that holder your funds until the beginning or the end of the month, that would be about $1,500.00 they would deposit into your checking out.

    With a merchant account, your deposits would be on a daily basis. So you could earn interest on that money on a daily basis. Paypal does allow you to earn interest as well if you maintain a balance though. (I am not certain if 2CO has this option or not.)

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    Do you know what the balance must be maintained at to receive interest at PayPal, and how much it is?

  17. #17
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    I do not think that you have to maintain any balance to my knowledge. You do have to ive them your social security number though

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    Annual Rate of 1.5% - That is hardly worth it.

  20. #20
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    No, not much at all but for some who cannot get a merchant account or maybe even a bank account - not too much of a choice.

  21. #21
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    So, the best way to go is get a good checking account with good interest, setup merchant account - and earn interest on the money in the checking account? Corey, which Gateway do you suggest. I am looking into Authorize.net obviously, because I currently have a coupon for Free 250 Transactions per Month, and 5 cents per after that.

  22. #22
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    That is what I would suggest. I remember when I was about 16 yrs odl - I had an accountant tell me to make sure that I always should make sure that the correct amount of taxes was taken out each month so that at the end of the year - my refund was less than $100. Because the dollar is usually worth more yesterday than today.

    You will see according to the figures that I posted - the percentages are not that much different but considering that you can make moeny on your money - it might be worth the change.

    The three gateways that I know of are the LinkPoint, Authorizenet.com, and the Verisign. These were the ones that we first hooked up into. Depending on your volume, you can also request a lower transaction rate.

    Also look into how much you will be paying the cc processor. Try to get billed from the same company. Otherwise, you might be double billed. And make sure that whatever company you choose - they do not make you sign an exclusivity agreement. That is something that a lot of the companies are doing now.

  23. #23
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    Which gateway do you recommend?

  24. #24
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    Well I have used authorize & linkpoint in the past. We still use LinkPoint. I am happier actually with Linkpoint - they seem to offer a lot more than authorize. And with Verisign - you have to pay a lot more for the same features.

    I have heard a lot of people that say that LinkPoint provides horrible customer service - but I will say that I actually had to call them last week for an issue & they walked me thru everything. Even got another person on the phone that wrote the COM object because we had some very specific questions. (And I never had to get my roommate involved - who is in charge of the gateway.)

    LinkPoint is owned by First Data. Both LinkPoint & authorizenet.com uses the First Data platform to connect to visanet etc. Even Yahoo! uses the First Data platform.

  25. #25
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    What are LinkPoint's charges as opposed to Authorize.net? Like I said, I have an offer for Free 250 Transactions per month, 5 cents per there after. Is the difference worth giving that up?

  26. #26
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    Well it all depends on who you go thru as the processor. We are charged $10 on LinkPoint & .20 per transaction (which goes to the process / gateway).

  27. #27
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    I'd certainly agree with the assessment that Verisign is overpriced for the services that you get. I don't know of any compelling reason to use them currently due to that reason.

    With respect to Authorize.Net, it is one of the most solid gateway solutions available in the marketplace today. While it is integrated into the First Data network, it is also integrated into many other processing networks such as Vital, Paymentech, Cardsystems, etc.

    In terms of the Linkpoint gateway, I know that it is the "default" gateway utilized by most Cardservice merchants... but a merchant of ours mentioned the other day that Linkpoint doesn't have the ability to automatically void/decline a transaction based on the AVS/CVV match result. Is this correct or did he misunderstand?

    Beyond the concern outlined above (which may or may not be accurate), LinkPoint seems like another gateway option that could work well for merchants.

    Another solution on the market is Plug 'n' Pay which has a few interesting features of its own. Shift4 also has a gateway solution which is targeted more specifically towards high volume merchants and applications. ( There are also some other options mentioned here in this forum which I'm not at liberty to discuss due to the forum TOS.)
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  28. #28
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    In terms of the Linkpoint gateway, I know that it is the "default" gateway utilized by most Cardservice merchants... but a merchant of ours mentioned the other day that Linkpoint doesn't have the ability to automatically void/decline a transaction based on the AVS/CVV match result. Is this correct or did he misunderstand?
    It is basically up to the shopping cart to make that determination - not the gateway. I do not think that LinkPoint wants to get involved in the delicate situation of doing pre-auths or post-auths & the actually shipping of the goods.

    In terms of pricing - the Payflow Pro which has the ability for the API, recurring billing etc - is about $20 per month. So I guess it is not that much more - just that you are paying for the name.

  29. #29
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    Sorry to 'interrupt', but I don't understand what a payment gateway is for, as opposed to a merchant account. I assume the merchant account is the back-end for accepting payments, and they are the ones that handle your money, and deposit money into your bank account when due, and the gateway is the company that provides the front-end to your payment system, and that your shopping cart (or otherwise) connects to in order to verify a payment.

    I also assume I am wrong, so please correct me!

  30. #30
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    Basically SniperDevil - an internet merchant account usually consists of the CC processor and a payment gateway. The gateway is what allows you to connect to either a platform or directly to Visanet, etc to verify the transactions.

  31. #31
    I usd to use Authorize.net myself and was extremely unhappy with their customer support & billing methods. I was always getting double billed. After review of their site and talking with Corey on here I decided to use their services. He was actualy the only one that e-mailed me back. I have been extremely happy with the services they offer. I have even referred some business associates and family members over to him.

    I reviewed a lot of posts on here before I made my decision and it seemed like Corey was the underdog while everyone was just say talk to Chris, he will help you. Corey just always seemed to give advice and refer people to different companies. After I e-mailed everyone, he was the first one to e-mail me back and honest my questions openly and honestly.

    And I would have to disagree about the stability of authorize.net gateway, I think Linkpoint is more stable and after talking to a few of their clients I would never think about using another gateway other than Linkpoint.

  32. #32
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    I was looking through Corey's service, and the monthly gateway charge seems awefully high of $145. I was wondering if anyone knows if they offer a lesser volume gateway, at a reduced cost.

  33. #33
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    We have a lot of merchants who use Authorize.Net as well as one other gateway platform which I am not at liberty to discuss, and both groups seem to be very happy with the service that they receive.

    LinkPoint seems to work out really well for you, topguy, and that's great. If something works, stick with it, is what I say.

    Now, with respect to Authorize.Net's support... I've never had a problem reaching them myself. They offer live phone & chat support from 6AM - 6PM every day. I am also not aware of any "double billing" issue with Authorize.Net.... Authorize.Net provides online journal entries of all billings done so that you can see this directly at any time through your account.

    With respect to Linkpoint, I'm sure it is a good system. As I mentioned earlier, the only downside that I've heard is that some merchants do not like the fact that you can't set it to automatically decline a transaction if the AVS or CVV don't match.

    And we have a lot of merchant that want that level of scrubbing done on the gateway side vs. requiring 3rd party or custom software to handle that aspect of it.

    Authorize.Net provides that capacity as well as most other gateways that I am aware of. It also offers support for Verified by Visa, MasterCard's SecureCode, Verid and Fraudscreen.net.

    Authorize.Net is also compliant with quite a few processing networks - not just First Data - which provides a great deal of flexibility for the many ISO's/Acquirers who setup accounts through it. That is one of the reasons contributing to its success and its customer base of over 90,000 merchants.
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  34. #34
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    Thanks topguy. And actually the monthly charge for the gateway is $10. Hm I wonder if you saw a hidden page? LOL Guess I better search - no telling what some people might find one some of the sites

  35. #35
    So, the best way to go is get a good checking account with good interest, setup merchant account - and earn interest on the money in the checking account?
    What is your goal?

    You really interested in a paltry 0.15% return on your money (wells fargo checking w/ interest).

    You dont want substantial amounts of money just decaying in a bank account, besides your emergency fund.

    At least get yourself a money market account! Enjoy little risk and at least a 3-6% return, which still isnt stellar or anything.
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  36. #36
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    Originally posted by cybexhost1
    Can anyone name some more merchant account companies than CDG? Preferably cheaper ones.....?

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