WorldPay is arguably one of the biggest names in the payment processing industry. Being founded back in 1989 and being one of the pioneers of online payments, the impact of WorldPay on the payment industry cannot be ignored. It survived a major acquisition by another huge payment processor in 2018. The companies merged and became WorldPay Inc. this acquisition made the provider big enough to be called the biggest Merchant Acquirer Globally.
As you would expect with a provider of this size, WorldPay has always had many online complaints. WorldPay did a great job maintaining its online reputation for a while, but recently, there has been an explosive increase in the number of complaints. It has been under constant scrutiny by its clients and, recently, by its partners too!
WorldPay is a symbol of traditional merchant account processing in a world striving to change and revolutionize the payment industry. While merchant service providers have moved on from opaque fee structures and hefty early termination fees, WorldPay has not shown any significant changes in how it operates. Online WorldPay reviews show merchants are unhappy with the early termination fees.
Cutting Off Residuals to Inactive Mercury ISOs
A recent move by WorldPay has made it a highlight of criticism in the business world. WorldPay communicated to several of its ISOs that there would be no commissions on the residual reports of September. This note itself was sent almost a month after the suspension of residual payments.
WorldPay claims to have done this for two main reasons. The first one is the prolonged inactivity at the end of the ISOs. Here it says that some ISOs had added less or no merchants to the services of WorldPay over the course of a year. The second reason that has been the focus of negative attention on the internet is the increased attrition of merchant accounts.
WorldPay claims that this indicates solicitation against the services of the provider. WorldPay has pegged the blame of this solicitation at the end of the ISOs, and the cancellation of residual payments is a way to penalize the ISOs for the above two reasons.
Feedback From Businesses and Online Platforms
WorldPay has come under attack due to its latest move against Mercury ISOs, and understandably so. The first and most reasonable question surfacing is about the legality of this move. The payments have been suspended since 30th September 2022, and the ISOs were notified about this development on 26th October. Business owners and merchants analyze this move as another new rule made up by a legacy processor to get their way.
Furthermore, the fact that a new rule has suspended residual payments is a move that is not sitting well with many. The actual legal vitality of the matter can only be determined by the contract the ISOs had signed; at a distance, it is uncertain that the move was kosher.
Furthermore, the fact that WorldPay blames the ISOs for merchant attrition caused by solicitation was amusing to many. Several discussions online highlight so many reasons why merchants would choose to leave the provider and why merchants are unsatisfied with the merchants. People also highlighted this controversial move as one of the many reasons they keep their distance from WorldPay.
Analysts online claim that this move of suspending residual payments had less to do with holding ISOs accountable for lack of business, rather inclined towards WorldPay not wanting to pay the dues ISOs are entitled to. According to tweets and discussions regarding payment processing, this move may give them a bump in short-term revenue, but it will come at the cost of trust and deterrence of future business.
Other Factors Causing Loss of Clients
While WorldPay claims that merchant attrition is based on solicitation against WorldPay services, merchants face several downsides with the provider. Merchant service providers ignore these issues and put merchant grievances on the backburner; sooner or later, those problems cause loss of business. Here are a few major and repetitive grievances merchants have with WorldPay;
Three-Year Long Contract
Lengthy contract terms have become increasingly unpopular as more merchant-friendly processors have entered the market. Currently, providers with these lengthy contracts are seen as below-average and exploitative. The contract is not only non-cancellable but also has an auto-renewal clause for one year, which is tricky to avoid. There is no need to trap merchants in a three-year contract, especially if the offered services are competitive with modern payment industry standards. It is safe to assume that merchants will avoid processors with such contract terms.
Early Termination Fee
Initially, WorldPay used to charge a flat $495 for the early termination of a contract, but in recent years it has been lowered to $295 and prorated, so you have to pay lesser in consecutive years of the contract. Although the fees have been reduced, they are still there. Merchants would choose a provider that allows them an option to leave if they are not happy with the services over a provider that burdens them with hefty fees in the name of early termination.
Withholding of Funds/Account Termination
While excessive chargebacks and suspicious transactions are the main reasons for withheld funds, merchants face this issue ever too often with WorldPay. Unexpected fund holds can be a major setback for the businesses of WorldPay clients. This is a significant reason for merchant attrition and deterrence of new clients.
Undisclosed Terms
While this can be partly blamed on the ISOs, it is not why WorldPay cut off the payments. This is the exact opposite of solicitation and lack of activity. ISOs use undisclosed terms to attract merchants toward a provider; ironically, the most common terms that go undisclosed are the early termination fee and the three-year-long contract. It is no wonder merchants have complaints with WorldPay considering all these issues.
Verdict
Considering all the factors discussed above, WorldPay’s move to cut off residual payments to ISOs seems more like the provider didn’t want to pay partners rather than action on ineffective partners. Incompetent processing services can by WorldPay can be the reason for merchant attrition, and the claim of solicitation is just a way to avert the attention from the real problem. The suspension of payments refreshed all merchants’ and business owners’ grievances with the provider. The theme of the online backlash is very well described as a loss of reputation and trust with future and current partners and clients.
