Square, Mobile Payments, Customer Service, Phone Numbers and Money Holds

Yesterday I read a review of Square, Jack Dorsey’s fast-growing, extremely well-funded and hugely publicized mobile payments venture, on CardPaymentOptions.com. The review was, I think, a good and fair one. The author, Phillip Parker, does give Square credit for its innovative and affordable service that makes it easy for everyone, not just businesses, to accept credit cards on very affordable terms, while at the same time he gives the company low grades for the quality of its customer service and its Better Business Bureau record. Apart from the BBB grade, I accept Parker’s assessment.

However, what I found much more valuable was what I read in the comments underneath the review. Most of them were negative and quite a few were very negative. There were two overarching issues that were behind the commenters’ gripes: the inability to easily speak to a Square customer service representative and the holds the company places on its users’ funds under certain conditions. I’m sure that anyone with experience in our industry is nodding their head now. We know how big these issues are and I, for one, have been very curious to see how Square users would respond to the company’s policies. We are now beginning to get an answer.

When You Need to Speak to Someone

As anyone in the payment card industry world whose job has at any time involved some form of client support knows, when a merchant has a payment-related issue, they want it resolved immediately. Email is very rarely an acceptable communication channel; a merchant in need of help needs to talk to a live person and wants their call to be answered promptly.

This is why we at UniBul Merchant Services (a shameless plug, I know, but a fact nonetheless), as well as many of our competitors, provide 24 / 7 client support by phone. Now, you don’t have to offer a 24 / 7 sales line (we certainly don’t), as the person who’s inquiring about your service will not make a buying decision for at least a few days. But a well-staffed client support center, able to quickly take all incoming calls, is indispensable.

Now back to Square. It turns out that the company does have a support number, but it is nowhere to be seen on its website and users have to Google it, in order to locate it. It almost looks as if Square is hiding it. Many of the commenters who have called the company say that they have not been able to speak to anyone there and that their calls have never been returned. The callers with a positive experience are in a distinct minority.

If it does care about its image and long-term prospects, Square must clearly state its client support number on its website and be sure to handle all incoming calls quickly and professionally. There is no alternative and the sooner the company understands that simple fact, the smaller the damage. Still, I find it incredible that Square, with a former PayPal executive as a COO, needs convincing on this point.

When You Need to Get Access to Your Money

The other big grievance voiced by Square users has to do with the company’s policy for holding funds, under certain conditions. Here is what Square’s User Agreement says:

If you accrue more than $1,000 in card-not-present sales during any trailing seven day period, Square will defer depositing the amount in excess of $1,000 for 30 days. For accounts likely to exceed $1,000 in card-not-present sales per week, contact Square support to inquire about accelerating your payout schedule. Upon receiving this request, or once you exceed $1,000 in weekly card-not-present sales, Square will conduct a review of your Square Account to determine if you qualify for acceleration. Square will consider a variety of factors in making its decision, including but not limited to a proprietary set of rules, chargeback rates, transaction behavior, and other supplemental data about your business.

There are two issues with this statement. The first one is that very, very few people will read it, before signing up for the service. The second issue is that, even if they know about this clause, users will still resent it and that point is made very clear in the comments. You can read all kinds of hold-related horror stories there. Some of them may not be true, but the problem is that they are much more salient, and more numerous, than the positive comments.

Unfortunately, dealing with the hold issue is not nearly as straightforward a matter as the one of the phone number. See, Square uses the hold is a risk management tool. The only way around it would be for the company to start evaluating applications and approving processing volumes on an individual basis, much like what a traditional processor does. That way every user will know full well and in advance what their approved processing volume is and what will happen if they exceed the stated limit. The problem with this approach is that it is much more cumbersome than the current procedure and it will delay the sign-up process. So I don’t think Square will go that way.

The Takeaway

Now, when we talk about the issues users have with Square, we should keep in mind that the company signs up tens of thousands of new users each month. When the numbers are so huge, even a very small percentage of discontented customers will represent a very large group. And, as the comments on the CardPaymentOptions.com review make it clear, dissatisfied users are much more vocal than satisfied ones.

Yet, these negative voices also present Square with an opportunity to improve the quality of its service. The company should listen to its users and make adjustments accordingly. It should start by prominently displaying a phone number on its website and staff its support center with enough people to be able to handle all incoming calls. As discussed, resolving the hold issue is a trickier matter, but at the very least Square should do a better job at communicating its present policy.

Image credit: Squareup.com.