Phone Swipe Review
Looking for a free POS with a free card reader?
- Date Established
- Troy, MI
- Numerous features
- 24-hour funding available
- Supports receipt printer and cash drawer
- Buggy app
- Untransparent surcharging practices
- Not suitable for high-risk businesses
This mobile processing service, Phone Swipe (stylized as phoneSWIPE), is owned and operated by North American Bancard (NAB), a company I’ve reviewed in detail here. I gave them an average rating, but noted that they seemed to be improving. I also noted that the NAB advertising and marketing can be very confusing, with multiple websites advertising different information regarding the same services. Here, too, I have to clear something up.
You may already have heard about the popular mobile processing provider PayAnywhere. North American Bancard also owns and operates PayAnywhere. In fact, the two apps are essentially identical, as are the rates, fees and service options. The difference between the two mainly takes the form of marketing. NAB allows independent agents to sell and market Phone Swipe in a variety of ways, while PayAnywhere is fairly standardized via their website. Even though these two services are very similar, I beleive they warrant separate reviews because of discrepancies I’ve noticed in user experience.
The big draw that Phone Swipe advertises is that they’ll set you up with your own unique merchant account instead of aggregating you in with thousands of other merchants. This should lead to better account stability and less likelihood of withheld funds. Check out this article for more information about the difference between aggregators and standard providers.
The app itself has a ton of useful functions including above average inventory options as well as nice in-app reporting tools. The user interface is a little bit clunky and has a few glitches, but with a little improvement this could be a frontrunner in terms of free smartphone payment processing apps. Beyond that, the rates seem fair and the next-day funding really comes in handy for most merchants.
Unfortunately, I am still seeing a lot of complaints come up about account terminations and withheld funds. Despite their claims of better account stability, I don’t know that this service offers a distinct advantage over Square or PayPal Here. I’ve also found a number of worrisome clauses in their Terms and Conditions that outline various surcharges among other things. Until they can provide better terms, you should click “Accept” at your own risk.
For their efforts and very promising software, I give Phone Swipe 3.5 out of 5 stars. They’ll need to clean up their contract and include clearer disclosures of contract terms to get any better than that.
Read the full review for more information and check out our mobile payments comparison chart to see our favorites!
Table of Contents
Products & Services
- Merchant accounts: Unlike most mobile processing services, Phone Swipe will set you up with your own merchant account. I’m not sure how they do this without charging a monthly fee, but I generally view this as a good thing. This type of processing tends to have better stability than aggregated processing. Merchant accounts are of course provided through NAB, who uses Global Direct as their processor.
- Smartphone and tablet apps: The app itself is probably the best thing about Phone Swipe. It’s compatible with most Apple, Android and Blackberry devices and has a ton of useful features I discuss later on in this review in more detail.
- In-app reporting: It’s nothing too fancy, but performs at a better than average level.
- Email/paper receipts: As far as I can tell, paper receipts are only available if you run the app through an Apple device. It works with AirPrint devices or Star thermal printers.
- Inventory functionality: Nothing too fancy here, but it works. Like most apps, you can add pictures directly from the camera of your phone or tablet.
- Multiple terminal support: You can use one account to process through multiple terminals.
- Hardware sales: Including an Apple-compatible cash drawer and printer.
- Express sale checkout option: If you just want to ring up a set dollar amount without fussing with inventory options, you can use the express sale function. The one shortcoming here is that you’ll have to make the whole order taxable or not tax it at all.
- Deactivate signatures for small tickets: If the order is under $25, you can choose to not require a signature. This can save you a of of time and hassle.
- Discounts feature: This can be enable or disabled in the general settings menu.
- Invoice numbers: A nice feature when you need it, this can also be toggled on or off in the general settings menu.
- Auto-detect sales tax: Using GPS location services (if enabled), the app can automatically detect and use the local sales tax. This can also be turned on or off.
- In-app reporting: You can see daily, weekly, monthly or yearly reports and use the search function to find specific transaction by name. Each transaction is linked to the detailed receipt. Refunds, including partial refunds, can be issued quickly and easily. I really liked this system. Very functional.
- Inventory management: Create item listing with tags and categories. You can add pictures as well as descriptions and receipt notes that will appear on the receipt when a customer buys a specific item. Mark specific items as taxable or not. You cannot manage an inventory, however, since no quantity options are available. Still, it’s very functional and I was overall impressed when testing it out.
- Receipt printing: I tested out the AirPrint compatibility with my wireless printer and it worked flawlessly. Receipts are highly customizable and overall very professional looking. The app also works with Star Print printers.
- Cash drawer connectivity: You can purchase a cash drawer through the Phone Swipe site.
- iPhone 3GS or newer
- iPod Touch 3G or newer
- All iPads
- Must use iOS 4.3 or higher
- Google Nexus 4
- Google Nexus 10
- Samsung Galaxy S3
- Samsung Galaxy S4
- Samsung Tablet 2, 7″ and 10″
- Must use OS of 2.4 or higher
- May work with devices not listed
- Bold – 9000, 9650, 9700, 9780
- Curve 2 – 8520, 8530
- Curve 3G – 9330
- Storm 2 – 9550
- Torch – 9800
- Tour – 9630
- Must use OS 4.7 or higher
- May work with devices not listed
Fees & Rates
The rates and fees used by Phone Swipe are in line with the industry standard for standalone, pay-as-you-go mobile processing. Users can also expect a couple of standard perks: A free card reader and no monthly fees for service.
In terms of standard rates, you can expect to pay:
- Swiped transactions: 2.69%
- Keyed transactions: 3.49% + $0.19
…And that’s it for basic processing fees. (Read on to find out about potential surcharges.)
Beyond that, you should be aware of the following fees, which are not plainly advertised:
- Chargeback fee – $25 every time someone charges back a transaction, even if you win the chargeback.
- NSF (Non-Sufficient Funds) fee – $25 whenever Phone Swipe tries to debit your account but you don’t have the funds.
- Retrieval fee – $15 every time your customer or your customer’s issuing bank requests a copy of a sales receipt for any given transaction.
You can see their standard fee schedule here.
Unfortunately, it seems like there may be surcharges not discloses in the fee schedule. This is from their Terms of Service:
Surcharges occur on specific types of cards (including without limitation Visa Rewards Card, Visa Signature Card, Visa Signature Preferred Card, Visa Infinite Card, Mastercard Rewards Card. Mastercard World Card, Mastercard World Elite Card, Discover Rewards Card, and “foreign” cards issued outside the United States), if the merchant accepts credit cards. Unless your Card Services Fee Schedule specifically addresses commercial cards (i.e., Business Cards, Corporate Cards, Fleet Cards, GSA Cards, Purchase Cards), you will be billed back for the higher cost of acceptance of commercial cards
Be very, very careful here. Personally, I would not sign this without explicit disclosure of these surcharge amounts. When I contacted a representative, he told me that the non-qualified surcharge is $0.19 and that it only applied to keyed-in rewards/business cards. Only swiped corporate cards carry the surcharge. While this explanation sounds reasonable and I generally believe it (although he was not very forthcoming or direct with this info), you should be cautious since by agreeing to the terms you are legally allowing Phone Swipe to apply any number of surcharges.
Contract Length & Early Termination Fee
There’s no long terms contract and no early termination fee with Swipe Pay. Your merchant agreement renews in 30-day increments, but you have no penalty for cancelling the service. You should note, though, that it appears you must return the free card reader at your own expense if you wish to cancel:
In the event of termination, all equipment must be returned immediately to North American Bancard at Merchant’s expense.
Sales & Advertising Transparency
While Phone Swipe puts most of the deal out on the table for prospective merchants, they intentionally avoid some of the more touchy issues involved with processing. This is common among most providers, but that doesn’t make it okay. For instance, unless you ask you’re unlikely to hear much about:
- Processing limits: You will have a weekly limit and a high-ticket limit. Processing outside these limits can lead to funding holds.
- Funding holds: If the processor views a transaction as “high-risk” they will hold the money for up to 90 days in most cases.
- Account terminations: If the processor investigates your business in more detail after approving you (as they often do), they can terminate your account without warning for a wide variety of reasons.
- Chargebacks: Chargebacks can force you to issue refunds, and come with their own fee of $15 beyond the refund.
- Other fees: Fees such as non-sufficient fund and retrieval fees are common, but not plainly disclosed.
All of these points are incredibly important to take note of when looking for a good mobile processor, so I’d like to see more overt disclosure on these points.
Furthermore, there are major discrepancies between their advertised terms and the actual contract they have you sign, including non-qualified surcharges and card-not-present limitations.
Customer Service & Technical Support
In the realm of customer service, Phone Swipe definitely delivers quantity with 24/7 support via web or phone. In terms of quality, I’m not so sure. When I reviewed North American Bancard, I was unimpressed with their support. Many merchants have also reported lackluster performance.
They offer a moderate knowledgebase with videos for self-service support. I found it useful.
Negative Reviews & Complaints
Since Phone Swipe is serviced directly by North American Bancard, we have to consider the reputation of NAB when talking about Phone Swipe. You’ll find about four complaints filed with the BBB under the Phone Swipe LCC name, earning them a C rating. North American Bancard has an A+ rating with 445 registered complaints in the past three years.
The good news? Most of the complaints against NAB will not carry over to Phone Swipe, since you won’t have to worry about undisclosed early termination fees or PCI compliance fees.
The Phone Swipe app itself has a few issues worth noting. These complaints came up at least a few times on the web:
- Can’t enter billing address: I experienced this myself when testing the app. You can’t get a keyboard to come up in order to enter a billing address. You can only use numbers. This is a glitch that they really need to address
- Takes time to set up account: This is to be expected, since they are setting you up with a merchant account. The approval process takes time. But Phone Swipe is competing with the instant access offered by mobile processors like PayPal Here and Square, so merchants are become more and more impatient.
- Slow App: A number of merchants have complained about the app operating slowly or crashing.
Positive Reviews & Testimonials
I haven’t seen any merchants providing positive feedback or testimonials specifically about Phone Swipe. Personally, I found the app to be very useable. It’s not all that pretty to look at, but it’s quite functional aside from a few glitches. Beyond that, I do like that Phone Swipe gives you an actual merchant account with no monthly fees. That’s pretty impressive assuming they provide good account stability.
For a standalone, pay-as-you-go mobile processing service, I actually think Phone Swipe could be a good option. At a glance I like their app, that they offer a merchant account, and that their pricing seems reasonable. Unfortunately, I do not like their contract! While it’s unclear to me to what extent they enforce their Terms and Conditions, I cannot currently recommend that you agree to these terms. They are less favorable than your standard mobile processor.
It’s a shame, because the app really seems promising. But with all of the hidden language about non-qualified surcharges, you should be wary of hitting the “I Agree” button on your application. Until they revise this language or otherwise prove to me that these terms are not enforced, I can only offer Phone Swipe a modest 3.5-star rating. I hope to come back to this with good news in the near future.
To learn more about how we score our reviews, see our Mobile Credit Card Processing Rating Criteria.