1600 Capital One Drive, McLean, VA 22102
Owned by Capital One and using a Verifone gateway, Spark Pay offers one more way a merchant can take sales via a mobile app and card reader. Low-risk merchants making more than $1,300 per month in sales are the best fit for this service.
You'd think that a company as large as Capital One would make more noise about their Spark Pay service, but that's not the case. Capital One took over this service from Verifone ("Sail"), rebranded the product, and put it back out on the market in 2013. Spark Pay supplies merchants with a swiper and accompanying app, and that's it. Athough we initially believed that this service was aggregated, Capital One states that it is a full-blown merchant account.
With that said, Spark Pay acts more like an aggregator, including the prices levels. Small merchants really don't see an advantage of using this service over an aggregator like Square or PayPal. Additionally, the major source of complaints center around Spark Pay's quick reaction to high-risk businesses and chargebacks with fund withholding without notice.
The app and card reader are solid, but the service is limited to the U.S. at present. Spark Pay seems to have plans for expansion in the near future, however. If you manage a low-risk business, Spark Pay may be worth a look...
Below is a detailed review of SparkPay.com Merchant Services offering. The review is broken down into the following categories.
Depending upon the type of business you own, some of the following features may be very important to you, while others may not matter.
Spark Pay is limited to a number of capabilities, and far less useful than Square. Square, at least, offers a variety of options when using their services, including the ability to conduct international sales.
| Software Compatibility: | |
|---|---|
| Intuit Quickbooks | Possible |
| Sage 50 | No |
| Microsoft Dynamics GP | No |
| Hardware Compatibility: | |
| Windows / Blackberry | No |
| iPhone / iPad | Yes |
| Android | Yes |
| Alternative Transaction Types: | |
|---|---|
| Phone Orders | Yes |
| Internet Orders | Yes |
| Wireless Orders | Yes |
| Mobile Orders | Yes |
| Snail Mail Orders | Yes |
| American Express (AMEX) | Yes |
| Add Tips to Bills | Yes |
| eCommerce / Shopping Cart | No |
| International Sales | No |
| Recurring Payments | Possible |
| EMV Chip Cards | Yes |
| Contactless Cards | Yes |
| Loyalty / Gift Cards | Possible |
| eChecks / Electronic Checks | No |
| Welfare Benefits (EBT/SNAP/TANF) | Possible |
| Security / Fraud Prevention: | |
| AVS Fraud Protection | No |
| PCI DSS Secure Transactions | Yes |
| Industry Specific: | |
| HIPAA Compliance (Healthcare) | No |
| Trust Account Debiting (Legal) | No |
| Fleet Cards (Petroleum) | No |
| Online Menu Orders (Restaurants) | Possible |
| Countries Served: | |
| U.S. | Yes |
| Other Countries | No |
| International | No |
We're a little confused about the tip option, as the eCommerce online order possibility seems impossible. We're guessing that the swiper can be used face-to-face with table sales in this case.
Almost every merchant account services company uses either Interchange Plus or Tiered Pricing (to learn the differences read here). Where companies allow us to disclose pricing information, we show the deals that our secret shoppers were able to achieve. When companies offer both Interchange Plus and Tiered Pricing, we try to get a quote on both options.
Spark Pay offers two payment plans based upon sales volume. Spark Pay suggests that $1,300 is the switch point, stating that merchants can save considerable money by using the "Go Plan" for under $1,300 in sales and the "Pro Plan" for sales over $1,300 per month:
Go Plan
Pro Plan
Spark Pay doesn't offer non-qualified card numbers (meaning gift cards, reward cards, etc.). Basically, it appears that this plan is better for those merchants who conduct more than $1,300 in sales, despite the monthly fee.
While some of the prices above may seem attractive, we're concerned that Spark Pay may whack the merchant with hidden charges. Here's what we discovered:
| Fine Print Fees: | |
|---|---|
| Termination Fee | None |
| Setup / Application Fee | None |
| PCI Compliance Fee | None |
| PCI Inaction Fee | None |
| Gateway Fee | None |
| 1099-K Fee | None |
| Statement Fee | None |
| Online Reporting Fee | None |
| Monthly Minimum Volume Fee | None |
| Accept International Pymt Fee | None |
| Voice Authorization Fee | None |
| Monthly Min. Process Fee | None |
| Daily Batch Fee | None |
| ACH / Direct Deposit Fee | None |
| ACH Charge Fee | None |
| ACH Return Fee | None |
| FANF Fee | None |
| Chargeback Fees | $15 |
Swiper
| Freebies: | |
|---|---|
| Initial Consultation | |
We were pleasantly surprised to learn that there are no hidden fees or charges at present. What Spark Pay doesn't mention is that they regard some businesses as high risk that normally are not listed with high-risk companies. For instance, they consider furniture and appliance stores as high risk. Also, the company provides a long list of prohibited businesses in their "legal" section on their website. Most of those prohibited business types are typical, such as illegal activities or goods, telemarketing, and adult entertainment.
Merchants need to scour this list to make sure their businesses comply, because the largest complaint about this company centers on reserve withholding for chargebacks. The legal terms on the Spark Pay website aren't very clear about the first month's service to merchants: Be sure to keep all sales documentation, including a detailed and dated invoice, any contract copies, and additional information about the cardholder...but they don't state the information that the merchant needs to collect. That's the kicker with this service -- the first month with Spark Pay is, basically, a review about your business and or services. If Spark Pay doesn't like what you're doing, they can withhold funds or terminate you without notice. While this is a common practice with aggregating services like PayPal or Square, Spark Pay states up front that the use of their service consistutes a merchant account.
A final note on usage: Spark Pay states that they have the right to "round up" all payments to the nearest $0.01. That "rounding up" concept is rare enough to mention here.
Capital One via Spark Pay offers a swiper to use with mobile devices.While your transactions will take place via your merchant electronically, the actual device that you use to swipe a customer's card into is referred to as "the equipment." This equipment includes hardware and, often, software or apps for that hardware to function properly.
Spark Pay is all about the mobile solution and its app:
HARDWARE
SOFTWARE
Spark Pay currently operates only within the U.S. Spark Pay states they plan to roll out service to American territories in 2015.
We generally don't like to see long-term contracts or termination fees in merchant services agreements, because the ability to cancel a contract keeps the credit card processor on its best behavior (and more likely to try to make you happy if there's a dispute). The ability for the merchant to cancel gives you, that merchant, the ability to choose a better deal that might come along down the road before your current contract expires.
Spark Pay offers a month-to-month contract with no early termination fees. Pay attention to the termination guidelines, especially with monthly payments. Even if you're not using Spark Pay, they may continue to deduct the monthly fees from your "Pro" account.
The merchant account services industry is multi-layered. Understanding how those layers fit together can be confusing (Read More in this Article). A good thing to know, however, is whether or not your company is a direct processor (good if yes) or, if not, then to know who they process with and whether or not that processor is reliable. The second thing to know is whether or not the service or sales staffs are in-house or outsourced. In-house staffs are preferable for you, as these staff members may have more access to sources that can resolve your issues.
We're not sure which company processes the accounts, but Capital One owns this service, so we'll presume that Capital One processes the accounts. The gateway is VeriFone's PayWare Connect Gateway.
Spark Pay has chosen to be very quiet about its initial offering and subsequent sales. No reseller opportunities exist as far as we can see.
Spark Pay offers phone support to existing customers from 9:00 am to 9:00 pm EST from Monday through Friday, plus weekend support from 9:00 am to 5:00 pm. Email support offers a one-day turnaround. When we went searching for complaints about Spark Pay, very few of those complaints pointed to lousy customer service. The site contains a fairly comprehensive FAQ regarding the most asked questions about this service.
As part of our review process, we try to test out the claims made by the Merchant Account Services provider by placing a few test calls, and working through the customer service process.
5/12/2015; TIME: 11:58 am EST
Call to Customer Support
When I called in to Spark Pay, I had three options to choose -- one was existing customer, another suggested I hang up and look again at the FAQ page, and the third suggested I stay on the line to talk to a Capital One representative. Beth answered, and she was most helpful with my questions, although when it came to answering my question about antiques or vintage as "high risk," she couldn't answer that question. I asked, since that category wasn't listed, and antiques can be listed as high risk for other processors. She stated I would just need to apply and then see if I was accepted or turned down. Beth did clarify that the information a merchant needs for documentation on a customer included name, zip code, credit card number, expiration date, CVC code. This information is especially important for a manual (no card present) transaction.
Our Take: I wasn't dissatisfied with the customer support responses, but felt like I was left hanging with no answer to my question other than to apply for an account.
We scoured the web to find past and current customer complaints about this processor. Then, we investigated those complaints that seemed legit and provide our verdict on how well the processor handled the issues.
Funds withheld on chargebacks and with large transactions.
This company is becoming more notorious for its reserve fund withholding. We can't emphasize enough that Spark Pay uses that first month's service as a way to scrutinize you, the merchant, as a user. If you have bad credit, chargebacks, or other red lights that show up on their radar, they can and will either begin withholding funds or terminate your account altogether. Withholding funds, especially large amounts, can prove disastrous for any business, but especially for small businesses. Note that some of the complaints stated that Spark Pay withheld funds for longer than the stated 180-day period.
Although Spark Pay appears to be transparent about their pricing and services, they seem to arbitrarily alter their guidelines when they see fit. This problem, along with lack of international sales and limited sales potential with a swiper only, also limits the use among merchants.
| Overall | |
|---|---|
| Price | |
| Customer Service | |
| Customer Reviews |
| Setup Fee | $0.00 |
|---|---|
| Monthly Fee | $0.00 |
| PCI Compliance Fee | $0.00 |
| Online Reporting Fee | $0.00 |
| Batch Fee | $0.00 |
| Gateway Fee | $0.00 |
| Chargeback Fee | $0.00 |
| Termination Fee | $0.00 |
| Contract Length | Month-to-Month |
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About the Reviews: These reviews, and for that matter any reviews, are inherently subjective, and should be regarded as our opinion, not as a statement of fact. Selecting a merchant services provider is an important decision, and we urge you to use no single source of information as the basis of that decision.
About the Pricing: This pricing is an estimate based on limited available information. In some cases, the Processors' pricing information was provided directly by the company, in others, we obtained it from public information, through calls to the company, or through past or current clients of the company. Where, despite these efforts, we were unable to obtain any information about certain fees, we used estimates based on similar providers in the industry. While we're working, in some cases, with the company directly to get more accurate pricing, even in those circumstances, we can't guarantee the pricing's accuracy. Complicating all of this, is that for some companies individual salespeople are given authority to modify terms on a deal by deal basis. In any case, if you know of an error, please let us know and we'll fix it.
About the Calculations: With respect to your estimated savings, this is based on a lot of factors and some hard math. The reason we do it, along with the "Actual Gross Rate" calculation is that every Processor prices their product differently (e.g. interchange v. 3 tier v. 4 tier v. flat v. membership, etc.) and some make it intentionally complicated or opaque. Trying to convert their pricing structure to a consistent "Overall Cost of Processing" is the only way you, the merchant, can do an apples to apples pricing comparison and know whether an offer is actually a good deal. Our system isn't perfect but we're trying.
Conclusion: In sum, these rankings, ratings, and scores are inherently subjective, and should be regarded as our opinion and not as a legal statement of fact. Moreover, use these prices and estimates at your own risk, and make sure to verify the pricing you see here in any formal contract you receive. Finally, if you do find something wrong in our pricing, terms, etc., tell us and we'll try to fix it.
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