Wholesale Payments vs. Host Merchant Services

Wholesale Payments vs. Host Merchant Services: Why HMS Is the Best Choice?

Choosing the right payment processor is a critical decision for any merchant. In online payments within the US, Host Merchant Services and Wholesale Payments stand out as notable options. Although both companies are focused on payment processing, Host Merchant Services tends to be more suitable for smaller or emerging businesses, especially those in high-risk categories or those just starting, due to its strong reputation. This article will investigate and compare both platforms to determine whether Host Merchant Services offers more and is better than Wholesale Payments.

An Overview of Wholesale Payments

An Overview of Wholesale Payments

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Wholesale Payments markets itself as a specialist in wholesale credit card processing, providing cost-effective solutions designed to meet the needs of businesses of all sizes. The company emphasizes competitive pricing and tailored customer service, making it an attractive option for merchants aiming to reduce processing fees and increase profits.

Established in 2006 as Lubbock Credit Wholesale, the company rebranded to Wholesale Payments in 2007 and is headquartered in Lubbock, Texas. As a merchant account provider, Wholesale Payments offers a range of services across various sectors, including retail, mobile, e-commerce, restaurants, and petroleum.

The company’s offerings include traditional processing, gift and loyalty card services, cash advances, and more, focusing primarily on small and online businesses. Its pricing structure varies, with some reports indicating both tiered and flat-rate pricing models are available. Additionally, Wholesale Payments supports a variety of mobile and contactless payment methods. Despite its services, the company’s reputation in the industry is mixed, with many online complaints noted on platforms like the Better Business Bureau and other review sites.

Pros and Cons of Wholesale Payments


  • No setup fee is required.
  • Ability to create and sell gift cards.
  • Availability of a loyalty card program.Option for cash advances.


  • An early termination fee applies.
  • Monthly fees are charged.
  • Bound by a three-year contract.Use of independent sales agents.

An Overview of Host Merchant Services

An Overview of Host Merchant Services

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Host Merchant Services is a versatile merchant service provider catering to high-risk and standard businesses. They specialize in payment processing and assist businesses with setting up point-of-sale systems and additional tools such as websites and loyalty programs. Demonstrating a strong commitment to customer service, their merchant support team is four times larger than their sales team.

Host Merchant Services offers a variety of appealing incentives for merchants, including no-term commitments, free equipment programs, and guaranteed lifetime rates—ensuring that merchant rates are fixed and will not increase over time.

The company provides solutions for a broad spectrum of industries, including retail, debt collection and recovery, real estate, e-cigarettes and vape shops, restaurants, airlines, nonprofits, timeshares, e-commerce, gambling and casinos, veterinary services, auto shops, medical fields, lodging and hospitality, fitness, and firearms. Host Merchant Services also tailors its services to high-risk merchants through a partnership with Electronic Merchant Systems (EMS).

Their product offerings include EMV card readers and swipers, point-of-sale solutions from brands like Vital POS, Clover, and SwipeSimple, payment gateways, mobile payment solutions, virtual terminals, other e-commerce tools, cash discount options, EBT processing, and programs for gifts and loyalty. Additionally, they provide cash advances, further supporting business financial flexibility.

Pros and Cons of Host Merchant Services


  • Complimentary payment processing
  • Free web hosting services
  • Strong customer support
  • No fees for early termination
  • No minimum monthly transaction requirements
  • Clear and straightforward pricing
  • Accommodates high-risk merchants.


  • Potentially costly for merchants with low transaction volumes
  • Services limited to US-based businesses    

Wholesale Payments vs. Host Merchant Services: Comparing Products and Services

Products and Services of Wholesale Payments

  • Comprehensive Payment Solutions

Wholesale Payments provides an extensive array of payment processing services. This includes the capability to handle transactions via debit and credit cards, checks, digital wallets, ACH, and other contactless methods. The company specifically points out that businesses such as retail stores, restaurants, and gas stations stand to benefit greatly from their advanced level 3 processing solutions.

  • Cash Advances for Businesses

Offering up to $150,000 per location, Wholesale Payments provides merchant cash advances that are particularly beneficial in the retail and hospitality sectors. This service is structured so that payments are only made as the merchant earns revenue, with a small percentage taken from each transaction until the full amount is repaid. The process is automated, and having bad credit does not necessarily exclude merchants from eligibility.

  • Gift Card and Loyalty Programs

Like many merchant service providers, Wholesale Payments offers programs for both gift cards and customer loyalty. These programs allow businesses to issue gift cards, which not only generate revenue upon purchase but also when redeemed. Additionally, their loyalty programs help encourage repeat business by offering attractive deals to customers, and they can be leveraged to drive sales through promotions and special discounts.

  • Equipment Options

Wholesale Payments supplies a variety of payment processing equipment, including universal Verifone models like the popular Vx 520 for countertop use. For businesses that prefer mobile solutions, Wholesale Payments also offers a mobile app and secure card readers, enabling payments via smartphones or tablets on the go.

  • Automatic Surcharging Program

The company also features an automatic surcharging program, which allows merchants to pass on the costs of credit card processing to their customers. By setting prices at a “cash price,” a 3.5% fee is added to transactions made with credit cards at checkout, effectively making credit card processing “free” for the merchant despite some associated fees.

Products and Services of Host Merchant Services

  • Payment Processing Services

Payment processing is likely a primary feature of interest when seeking a merchant services provider. Host Merchant Services offers flexible, no-term commitment contracts for their payment processing, enhancing the appeal for customers. Additionally, they provide round-the-clock customer support every day of the year.

Host Merchant Services supports various payment types, including credit, debit, EMV chip cards, and NFC payments. Notably, 98% of the businesses they partner with qualify for free equipment. They also provide options for wireless terminals and mobile solutions tailored to meet specific business needs.

For e-commerce businesses, Host Merchant Services offers more than 100 payment gateway options, along with virtual terminals and online shopping cart capabilities, ensuring robust support for online sales. Their security measures include EMV and PCI compliance, safeguarding transaction processing.

  • Online Payment Integration

Host Merchant Services caters to diverse enterprises with efficient online payment processing solutions that include advanced security and PCI compliance. Their services are designed to be integrated seamlessly with a variety of e-commerce platforms, CRM systems, and shopping cart software. Whether you’re using Shopify, BigCommerce, or XCart, setting up online payments is streamlined and straightforward. Available options for businesses include virtual terminals, online shopping carts, and mobile payment solutions, depending on specific needs.

  • Cash Discount Program

Host Merchant Services offers a cash discount program, which promotes itself as free payment processing. Participating merchants effectively pass the processing costs onto their customers through a small added fee on transactions using credit and debit cards, allowing the business to retain the full advertised rate.

This program is especially beneficial for businesses processing over $5,000 monthly. Smaller volume merchants can also participate but are subject to a $20 monthly fee. It’s important to note that businesses using the ‘tip adjust’ feature are ineligible for this program, as it conflicts with the program’s structure.

  • Secure Processing

Host Merchant Services provides a Level 1 PCI DSS-compliant hosting platform that meets all 12 PCI requirements. PCI, or the Payment Card Industry, encompasses major card brands such as Visa, MasterCard, Discover, JCB, and American Express. Compliance with PCI standards is crucial for any merchant accepting card payments, regardless of the volume of transactions.

Achieving PCI compliance helps mitigate the risk of fraud, enhances consumer trust, and ensures that hosting services are fortified against vulnerabilities.

Wholesale Payments vs. Host Merchant Services: A Comparison of Pricing Structures

Wholesale Payments’ contractual terms and pricing details are not prominently disclosed on their website. However, based on customer feedback, the typical merchant agreement with Wholesale Payments is a three-year term. The company is silent on its standard rates, fees, or pricing models online, but some reviews suggest a $500 cancellation fee and a monthly fee of $45 for an automatic surcharging program.

Wholesale Payments also offers a cash discount program that claims to eliminate merchant processing costs by imposing a 3.5% service fee on all non-cash transactions, thus passing the cost of credit card processing to the customers. Despite this, merchants might still incur other monthly and incidental fees, indicating that the service may not be as free as it might seem.

In contrast, Host Merchant Services adopts a clear and transparent approach to pricing. Host Merchant Services employs interchange-plus pricing, eschewing long-term contracts and early cancellation fees. They customize their transaction rates based on business type: retail businesses enjoy interchange rates plus 0.25% and $0.10 per transaction; restaurants are charged interchange plus 0.20% and $0.09 per transaction; and e-commerce transactions are processed at interchange plus 0.35% and $0.10. Host Merchant Services also caters to high-risk merchants with tailored rates dependent on the business type and processing history and guarantees lifetime standard rates.

Furthermore, Host Merchant Services openly discloses all additional fees, which include a $0.20 batch fee, an optional $5.00 monthly gateway fee, a regular monthly fee of $14.99, and an annual $24.00 fee for 1099 reporting. This transparency contrasts sharply with Wholesale Payments’ opaque fee structure and pricing, providing a clearer, upfront pricing model for businesses.

Wholesale Payments vs. Host Merchant Services: Customer Reviews

Wholesale Payments Online Reviews

Wholesale Payments has a notable online presence, with numerous customer reviews available. Unfortunately, many of these reviews are negative, highlighting issues such as high fees, costly contracts, and unsatisfactory customer service.

The Better Business Bureau (BBB) has accredited the company since 2007 and holds an A+ rating. Despite this, Wholesale Payments has received three positive and six negative reviews, along with 23 formal complaints filed with the BBB. A prominent concern cited by customers is the company’s sales practices, with reports of misleading information and undisclosed contract terms leading to unforeseen obligations and expenses. Transparency and honesty in communicating contract details are essential for building trust, particularly for small businesses, where unexpected costs can have severe financial implications.

Host Merchant Online Reviews

Host Merchant Services has not received any reviews for dishonest activities, which speaks to the effectiveness of their in-house customer support. Although there are some complaints about issues such as merchant account denials or hardware malfunctions, these are relatively minor and do not detract significantly from the overwhelmingly positive feedback the company receives.

Host Merchant Services enjoys a high customer satisfaction rating, with over 100 very positive reviews. Many of these reviews praise the significant cost savings achieved after switching to Host Merchant Services, as well as the excellent customer service and smooth onboarding process experienced. The few negative reviews seem to be isolated cases or have been resolved by Host Merchant Services. HMS also has an overall “A+” rating from the Better Business Bureau (BBB).


Host Merchant Services is a better choice than Wholesale Payments in terms of payment solutions because of its transparent and cost-effective pricing. Host Merchant Services offers flexible pricing, no-term contracts, and excellent customer support, ensuring merchants’ peace of mind.

On the other hand, wholesale payments have opaque pricing and negative reviews that raise concerns about reliability. If merchants prioritize clarity and value, Host Merchant Services is the preferred choice as it promises seamless payment processing and tangible support for business growth. With Host Merchant Services, merchants can confidently navigate the evolving payment landscape, knowing that their needs are prioritized and their financial interests protected.

Frequently Asked Questions

  1. What are the key differences in customer service between Wholesale Payments and Host Merchant Services?

    Host Merchant Services is praised for its 24/7 support and high customer satisfaction, while Wholesale Payments has faced criticism for customer service issues and contract terms.

  2. How do the fees and pricing models of Wholesale Payments and Host Merchant Services compare?

    Host Merchant Services offers transparent pricing with no early termination fees, contrasting with Wholesale Payments, which is known for less clarity in fee structures and potential hidden costs.

  3. Which company is better for high-risk businesses?

    Host Merchant Services specializes in high-risk industries, providing tailored solutions with robust risk management, making it ideal for sectors like e-cigarettes, gambling, and debt collection.

  4. What are the technological advantages of choosing Host Merchant Services over Wholesale Payments?

    Host Merchant Services offers extensive software integrations and dedicated technical support, facilitating seamless setup and operational efficiency, which is particularly beneficial for enhancing customer interaction.

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