CardConnect Review

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Pros

• Powerful CardPointe integrated payments platform
• Interchange-plus pricing available

Cons

• Contract length as long as five years
• Early termination fee as high as $750
• Uses independent sales agents
• Reputation for poor customer service

Overview

CardConnect is a merchant services provider headquartered in King of Prussia, Pennsylvania. The company originally started out in 2006 as Financial Transaction Services. In 2013, they re-branded themselves as CardConnect and moved their headquarters from Cleveland, Ohio to Pennsylvania. With the new name and new home came a shift in emphasis from merchant accounts to payment gateways and other tech-focused business products. CardConnect really wants you to think of them as a tech company rather than a financial services business. However, in reality, they’re much more focused on the latter.

When the company primarily provided business software services, they partnered with First Data, the largest direct processor in the United States, to offer merchant accounts as part of their lineup. In 2017, First Data acquired CardConnect, which is now listed on their website as “CardConnect – A First Data Company.” In January 2019, Ignite Payments, another First Data subsidiary, was absorbed into the CardConnect brand. With the addition of Ignite Payments, CardConnect is now the largest of First Data’s many independent sales networks. The company currently serves over 67,000 merchants globally, including numerous Fortune 500 businesses. High-profile clients include Adobe, The New York Times, and General Electric.

In earlier reviews, we’ve discussed the fact that it’s sometimes hard to tell whether CardConnect is primarily a payment gateway provider or a merchant account provider. With the acquisition of Ignite Payments, this confusion has (mostly) been eliminated, and the company now provides a complete lineup of all the merchant services you’ll need to run a retail or ecommerce business. However, most of the specific disclosures you’ll find on their website relate to software-based services. Details about merchant accounts — pricing disclosures in particular — are almost nonexistent. This isn’t all that unusual, as most merchant account providers disclose little or no information about processing rates, account fees, or contract terms on their sites. Nonetheless, it’s still disappointing in an age where truly tech-focused providers like Square (see our review) offer complete transparency on what their services will cost you.

So, will CardConnect be a good fit for you if you’re a small business owner? Well…maybe, and maybe not. There certainly are advantages to being able to plug into the vast resources of a major processor like First Data. However, as a small business, you’re not likely to get the low Interchange-plus rates that are offered to really big businesses who have very high processing volumes. You’ll also be stuck with various monthly and annual account fees that are an insignificant expense to a large business but can really add up for a smaller one. Lastly, accounts with CardConnect can have terms as long as five years — much longer than the industry average of three years. The company also sometimes imposes a shockingly high early termination fee of $750. While this isn’t always strictly enforced, it’s still much higher than the industry average.

Although these terms don’t apply to everyone who signs up for CardConnect, the fact that they’re imposed at all results in the company receiving an overall rating of 3 out of 5 stars. This is unfortunate because their payment gateway, virtual terminal, and mobile payments products are all high-quality offerings that we have no problem recommending. If you’re able to negotiate a contract that includes Interchange-plus pricing, month-to-month billing, and no early termination fee, CardConnect can offer you solid, high-quality service. If you can’t get these terms, however, you might want to look elsewhere. Check out our Merchant Account Comparison Chart for a side-by-side comparison of our top-rated providers.

Our Top Picks For Credit Card Processing

Products & Services

Rating: Excellent

Like most medium-sized merchant services providers, CardConnect offers a full range of products and services to enable your business to accept just about any kind of payment, whether you’re in retail, ecommerce, or both. Offerings include the following:

• Merchant Accounts: As we’ve noted, CardConnect is not a direct processor. However, their extremely close relationship with First Data should help to smooth out the kinds of problems that happen when merchants experience an account hold, freeze, or sudden termination.
• Integrated Processing Platform: CardConnect’s primary product is CardPointe, a cloud-based processing and reporting system that combines the functions of a payment gateway and virtual terminal. CardPointe integrates with traditional countertop terminals and mobile processing systems, so it’s not just for ecommerce merchants. With CardPointe, you can accept credit and debit card transactions, as well as eCheck (ACH) payments. CardPointe gives you 24/7 access to your account and features detailed transaction information, real-time reporting, PCI compliance features, support for recurring billing, product catalogs, and a customer database.
• Virtual Terminal: While the CardPointe software can turn your laptop or desktop computer into a credit card processing machine, you’ll still need a card reader for accepting card-present transactions. At $115, the IDTech SecuRED magstripe card reader is your simplest and least expensive option. For $160, the IDTech SREDKey reader adds a keypad but is still magstripe-only. To accept EMV cards, you’ll need the Ingenico iPP 320 ($310). For $360, the Ingenico iPP 350 adds a color display. If you want to go all out, you can spend $500 for the Ingenico iSC Touch 250, which includes a color touchscreen and digital signature capture capabilities.
• Credit Card Terminals: If you need a traditional countertop terminal, CardConnect can set you up with either a CardConnect-branded Ingenico iCT220 ($170) or iCT250 ($220). Both models are available on the CardPointe Shop site and include an installed software load to make them compatible with your CardConnect merchant account. While both devices are EMV-compliant, the iCT250 adds a color display and support for NFC-based payment methods (including Apple Pay and Android Pay).
• Mobile Payments: CardConnect’s mobile payment system uses the free CardPointe Mobile app (available for both iOS and Android) and their proprietary CardPointe Mobile Device. This $25 magstripe card reader plugs into the 3.5mm headphone jack on your smartphone or tablet (if it has one). Unfortunately, it is not EMV-capable at this time. Transactions processed with the CardPointe Mobile system will automatically show up in your CardPointe desktop software.
• Point Of Sale (POS) Systems: CardConnect doesn’t sell POS hardware directly, but their system is compatible with First Data’s Clover line of products and the Instore tablet-based POS system.
• eCheck (ACH) Processing: CardConnect’s gateway is capable of processing ACH payments, but it’s not clear whether this is a baked-in feature or an option you’ll have to pay extra for if you need it.
• Hosted Payment Pages: CardPointe HPP allows you to set up a secure, hosted page for online payments or donations. It’s customizable and doesn’t require any programming to configure. It’s also free to CardPointe users.
• Third Party Integrations: The CardPointe platform can integrate with hundreds of third-party business services, including online shopping carts, Point of sale (POS) systems, and accounting software.
• Security Features: CardConnect’s suite of security features is called CardSecure. CardSecure utilizes point-to-point encryption (P2PE) and tokenization to secure transactions. It also includes data breach protection and other features to reduce the scope of your PCI-DSS compliance requirements.
• Developer Tools: CardConnect also offers several APIs and developer tools that allow you to customize the integration between your website and their gateway. You can also integrate third-party applications using these tools.
• CoPilot: This is CardConnect’s web-based, paperless account application service. It’s used by the company’s sales agents to set customers up with new merchant accounts quicker and with less hassle than the old, paper-based system. While it’s certainly convenient, it also makes it much easier to sign merchants up before they’ve had a chance to review their contract documents thoroughly. Don’t allow yourself to be pressured into signing up for an account until you’ve taken the time to read your entire contract!

Fees & Rates

Rating: Fair

CardConnect’s website doesn’t disclose any information about processing rates, account fees, or contract terms. For that matter, they barely discuss merchant accounts at all. What this means for you is that their pricing is highly variable and will differ from one merchant to another. The only guarantee is that your account will be underwritten by First Data.

The company apparently offers a variety of both tiered and interchange-plus pricing plans. We highly recommend that you ask for an interchange-plus pricing plan, as there’s usually less markup and overall costs are generally lower. Be aware that Interchange-plus pricing may not be offered to you if you’re a startup or in the high-risk category. Also, be mindful of the fact that most sales agents will try to put you into a pricey tiered plan if you don’t specifically ask for interchange-plus.

Like processing rates, CardConnect’s fee structure is also highly variable. You won’t be charged an account setup fee, which is a good thing as we consider this to be a “junk” fee in most cases. There’s also no annual fee or reprogramming fee if you already have your own terminal. Beyond that, it depends on your needs and what your sales agent includes in your contract. Here are the most common fees you’ll probably have to pay:

• $9.95 monthly account fee
• $10.00 monthly wireless data fee (this only applies if you have a wireless terminal)
• $8.25 monthly PCI compliance fee
• $19.95 monthly PCI non-compliance fee
• $10.00 monthly gateway fee
• $5.00 monthly statement fee
• $20.00 monthly minimum
• $25.00 per occurrence chargeback fee

Most of these fees are in line with industry averages. I’m happy to see that PCI compliance is billed monthly, rather than charging you the full $99 once a year with no proration the way most processors do. At the same time, there are plenty of reputable processors out there that don’t charge for PCI compliance at all. The PCI non-compliance fee is something of a “junk” fee as well, as it’s just a penalty imposed if your account is out of compliance due to inaction on your part. The company isn’t providing any service to get you back into compliance with this fee. And yes, you will be charged both PCI compliance and PCI non-compliance fees at the same time if your account is out of compliance! Remember, these are only the most common and most significant fees. You can also expect to pay for things like voice authorizations, use of the Address Verification Service (AVS), batch fees, and other items.

Contract Length & Early Termination Fee

Rating: Poor

Much like their processing rates and account fees, CardConnect’s contract terms are all over the map. Depending on the nature of your business and your processing history, you might have a contract term of anywhere from two to five years. Or, you might not have a fixed-length term at all, with month-to-month billing and no penalty for closing your account.

It’s good to see that CardConnect is willing to offer month-to-month contracts for at least some of their merchants, but I’d really like to see them extend these terms to everyone. We haven’t been able to track down a copy of the company’s terms and conditions, but it appears that month-to-month billing is not written into the standard contract terms. Instead, CardConnect will waive the fixed-length term and early termination fee (ETF) for merchants who qualify. This practice can lead to some serious miscommunications, and we’ve seen several complaints where the merchant was assured by their sales agent that they were on a month-to-month contract, only to be charged an expensive early termination fee when they tried to close their account. If you are offered these terms, get it in writing and keep copies of documentation so you can prove it if a problem like this comes up later.

CardConnect also occasionally offers new merchants free processing equipment when they sign up for an account. While this might save you a few hundred dollars, and it might seem like a good deal if you only need one terminal, there’s a catch. Unlike some processors who charge you for your “free” terminal through additional account fees, CardConnect instead recoups the cost of the free equipment by locking you into a long-term contract. In other words, you can have a month-to-month contract or a free terminal, but not both. If you’re presented with this choice, we highly recommend that you take the month-to-month contract and buy your own terminal. Being stuck in a five-year contract will cost you much more in the long run than the purchase of a terminal. For that matter, the early termination fee alone will cost several times more than most terminals.

If your contract has a fixed length, you’ll also have to deal with an early termination fee (ETF) if you close your account before the term expires. We’ve found numerous reports from merchants indicating that CardConnect’s ETF is as high as an eye-popping $750. This is well above the industry average of $300–$500. For that matter, there are plenty of other providers out there who don’t charge an early termination fee at all. While we’ve seen instances where the company was willing to waive the ETF or accept a lower amount as a compromise, the best way to protect yourself is to follow the instructions provided in your contract for closing your account to the letter. If you do everything correctly, you shouldn’t have to pay an ETF at all.

Sales & Advertising Transparency

Rating: Fair

For a company that’s trying to present a tech-focused image, CardConnect’s website is surprisingly sparse. There’s a fairly general description of the company’s gateway and virtual terminal services, plus some information about the security features of these two offerings, but little else. Merchant accounts are barely even mentioned, and you’ll have to hunt around to find information about hardware such as terminals and card readers. Developers will be impressed with the CardConnect Developer Center, which contains a robust library of APIs for integrating CardConnect’s services with your website. Unfortunately, there isn’t a similar knowledgebase for customers who are trying to diagnose a problem with their merchant account.

CardConnect relies on a combination of in-house sales staff and independent sales agents to market its products and set up accounts. The use of independent agents — a common practice in the processing industry — has led to numerous problems due to their poor training and inadequate supervision. CardConnect is no exception, as we’ve found many complaints about dishonest and unethical behavior on the part of agents desperately trying to sell an account. One complaint even alleged that the agent went so far as to forge the merchant’s signature on contract documents in order to make a sale. Needless to say, we recommend that you work with the in-house sales team if at all possible when negotiating a contract for a merchant account.

The company also has a very active presence on social media, with accounts on Twitter, Facebook, LinkedIn, and even Instagram. CardConnect’s YouTube channel contains marketing videos and very cursory tutorials but no testimonials from happy clients.

Customer Service & Technical Support

Rating: Fair

CardConnect offers 24/7 telephone support and appears to handle this function in-house. You can also contact them through email. While having customer support available around the clock is highly desirable, it won’t do you much good if the quality of that support is lacking. CardConnect’s customer support has generated both praise and criticism from merchants online, with some customers being very happy with the quality and professionalism of the company’s staff, and others encountering rude and unhelpful support representatives. The overall quality of CardConnect’s support is inconsistent at best, and your experience will depend on who happens to pick up the phone when you call in.

The company now has a CardConnect Support Center on its website that functions as a rudimentary knowledgebase. It’s a good resource for new customers who want a little extra help in setting up their equipment and software services. However, except for the API Gateway documentation, it doesn’t go very deep into most subjects and will probably be of little use if you encounter a technical problem.

User Reviews

Rating: Fair

Negative Reviews & Complaints

Despite being in business for thirteen years, CardConnect only became accredited by the BBB in February 2019. The company has an A rating, with 26 complaints within the last three years and nine complaints within the last twelve months. While this is a significant increase in complaint volume from our last review update, it’s still a fairly average volume in comparison to the company’s size and the number of merchants it services. There appears to have been a surge in complaints since the company’s acquisition by First Data and its merger with Ignite Payments. We attribute this to the fact that merchant account issues tend to generate more complaints than the kinds of technical problems the company would have encountered when it was mostly focused on providing business software services. There are no complaints against CardConnect on Ripoff Report.

Examination of the complaints filed against CardConnect reveals several trends, including the following issues:

• Difficulty Canceling Account: This was far and away the most common complaint from merchants. Most providers go out of their way to make it as difficult as possible to close your account, with lengthy notice periods, written forms to fill out, and automatic renewal clauses that renew your account for another year (or longer) if you don’t complete the process in time. Merchants also share some of the blame, however, as many don’t take the time to read their contracts and understand what’s required of them if they want to close their account. If you decide to cancel your account, study your contract carefully, follow the instructions to the letter, and get everything in writing. It also helps to provide more notice than the minimum required.
• Expensive Early Termination Fee (ETF): Unless you’re billed month-to-month, CardConnect will charge you an early termination fee of up to $750 for breaching your contract. This often catches merchants by surprise, especially if their sales agent falsely reassured them that they wouldn’t have an ETF in their contract. Fortunately, CardConnect seems to be willing to waive the ETF entirely in many cases.
• Dishonest Independent Sales Agents: We’ve discussed this issue above, but there are a lot of complaints from merchants about independent sales agents who failed to disclose important terms of their contracts or outright lied about those terms. Unfortunately, it’s never a good idea to trust any sales agent at their word. Read your contract and confirm all important terms before you sign up.
• Poor Customer Service: Most of the complaints about rude or unhelpful customer service representatives came from merchants who were trying to close their accounts. At the same time, merchants had much more positive things to say about customer service when they were just trying to solve technical issues. To me, this indicates a problematic corporate culture that only values its customers as long as they’re still on the hook every month for fees and processing charges.

Positive Reviews & Testimonials

CardConnect likes to name-drop some of its larger Fortune 500 clients on their website but doesn’t provide any testimonials from them. For that matter, they don’t offer testimonials from any of their clients, either on their website or their social media accounts. This isn’t necessarily such a bad thing, as company-produced testimonials tend to be scripted and are less than convincing in many cases. Nonetheless, it would be nice to see some positive feedback about the company and its services. If you’ve had a good experience with CardConnect, please tell us what you liked about them in the Comments section below.

Final Verdict

It’s not hard to see why a company like CardConnect would want to project an image as an innovative, tech-focused company rather than one of being just another traditional financial services firm. Their CardPointe integrated payment processing platform is a strong, reliable product for both ecommerce merchants and retailers. However, you can’t use these services without a merchant account through First Data, and the terms of their merchant account contracts aren’t always the best. While they don’t specialize in setting up high-risk accounts or even advertise their availability, I suspect that many of the merchants who’ve been saddled with five-year contracts and a $750 early termination fee were in the high-risk category.

There are some things to like about CardConnect. I’m impressed that they’re willing to sell credit card terminals for a fair price rather than leasing them to unsuspecting merchants for far more money than they’re worth. I also like their CardPointe integrated payments platform, although it would be improved by the addition of an EMV-compliant card reader for their mPOS system. The CardPointe gateway is a solid product with all the important security features you need to keep your account (and your customers’ data) safe. The availability of Interchange-plus pricing is also a very good feature.

That said, CardConnect clearly isn’t a good deal for everyone. Five years is a significantly longer time to be stuck in a contract than most providers require, and having a $750 early termination fee hanging over your head makes it even worse. These terms alone are reason enough to skip them in favor of a more reasonable provider.

When you add everything together, CardConnect rates an average of 3 out of 5 stars overall. With so much variation in their contract terms, however, this is just an averaged-out rating between the best terms you can hope for and the worst ones you might be stuck with. If you can negotiate a month-to-month contract with no early termination fee and Interchange-plus pricing, the company performs on par with a 4-star provider. On the other hand, if you’re stuck with a five-year contract, a $750 early termination fee, and a tiered pricing plan, they’re a 2-star provider at best.

As always, we recommend that you negotiate aggressively for the best terms you can get. At the same time, you’ll need to be realistic. A brand-new business with no processing history is not going to get the most favorable terms from CardConnect. If you’d prefer to see what the best processors in the industry have to offer instead, take a look at our Merchant Account Comparison Chart.

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