TSYS Merchant Solutions Review
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- Date Established
- Omaha, NE
Total System Services, Inc. (TSYS) is a credit card processor with local and regional offices throughout the United States and a main headquarters in Columbus, Georgia. Although the company’s roots go back to 1959, it’s been an independent business entity since 1983. Not only is it one of the oldest processors in the industry, but it’s also one of the largest. With hundreds of thousands of merchants on board and an annual processing volume of over one trillion dollars, it’s second only to First Data in size.
A company this big is bound to have numerous internal divisions, and TSYS is no exception. The two divisions of primary concern to US-based merchants are TSYS Acquiring Solutions and TSYS Merchant Solutions. TSYS Acquiring Solutions serves as a third-party processor for other merchant account providers, including CPAY and many others. TSYS Merchant Solutions, on the other hand, is the company’s direct sales channel. This is where you would go in order to sign up directly with TSYS, rather than through a middle man, and I’ll focus solely on this division in this review. TSYS Merchant Solutions is based out of Omaha, Nebraska.
As you may know, there are many resellers (called ISOs/Agents) of TSYS that either contract TSYS for their processing platform, or act as referral partners for all of TSYS’ services. Some of those resellers are going to be ethical, and others are not. My advice would be to just go directly with TSYS Merchant Solutions for the most standardized and predictable experience. They have their own in-house sales team, and they can sign you up directly. There’s no need to go through a middle-man – unless that middle-man is going to offer you something above and beyond what TSYS Merchant Solutions can give you, such as superior customer support or training.
For a company of this size, I was surprised to find a relatively small number of complaints. I’ve seen small providers with five times as many complaints as this very large processor. As a point of comparison, the largest processor in the country, First Data, has about 1,000 BBB complaints. TSYS has well under 100. This is very encouraging in terms of assessing overall trends at the corporate level. Furthermore, the complaints that do crop up are usually handled quickly and ethically, including refunds when a misunderstanding occurs.
Things are not perfect with TSYS, but – if you approach them as an educated merchant – there is no reason why you can’t get good service at a reasonable price. My one real warning is this: If you only process a low volume (say, under $4,000 per month), TSYS may not be able to get you the best deal possible. A bit of negotiation may get you some results, but overall they are generally not the best option for low-volume processing. (Check out our merchant account comparison chart for better options, or consider a mobile-based processor for very low volumes.)
When compared to other processors of this size, TSYS performs very well, and earns a rating of 4 out of 5 stars. If you run a high-volume business or have complex processing needs, definitely check them out. Most mid-volume businesses can also find good service here. But, as always, use caution when dealing with resellers and independent agents.
Check out the full review below for more information. Good luck!
Products and Services:
- Merchant accounts: TSYS merchant accounts can be set up using either one of several Simplified Pricing Plan options (discussed in detail below) or a customized pricing plan. TSYS is also a direct processor.
- Credit card terminals: TSYS offers a number of Ingenico and Verifone credit card machines and PIN pads on its website, including both wired and wireless models. All models are EMV-capable, and some of them also support NFC payment options such as Apple Pay and Android Pay. We highly recommend buying your terminals outright rather than leasing them. If you buy your terminal online rather than directly from TSYS, remember that you’ll have to pay a re-programming fee for the software to make it compatible with your TSYS merchant account.
- Tablet-based POS system: TSYS offers their TSYS Tablet POS system, a tablet-based POS that comes with a tablet, stand and card reader. The Basic option is $39.95 per month, while the Complete option, which also includes a cash drawer and printer, is $49.95 per month. The TSYS Tablet POS is compatible with iPads and Android tablets. While it’s still be advertised on the TSYS website, this system is being phased out and replaced by the ProcessNow Register, a similar tablet-based POS system.
- Mobile processing: TSYS also offers mobile processing through their Mobile Payment Acceptance Solution, which uses a free magstripe card reader and the Mobile Payment Acceptance app. It’s available for iOS and Android, and features simplified pricing. There’s also a $5.00 monthly fee. There is currently no support for EMV or NFC payments with this system. Check out this chart to compare some of our highest-rated mobile processing options.
- Virtual terminal: For online businesses, TSYS offers their proprietary TSYS WebPASS virtual terminal, allowing you to process transactions from within your web browser.
- Payment gateway: TSYS also supports eCommerce merchants by offering a payment gateway that integrates with your existing website to allow online purchases using credit or debit cards. Options include either the proprietary TSYS Payment Gateway or Authorize.Net.
TSYS also offers additional services such as online reporting and TSYS Hosted Payment, a secure, iFrame-based solution that redirects your customers to a TSYS hosted server at checkout. With this system, sensitive customer credit card information is not entered or stored on your website.
Fees and Rates:
Processing rate pricing plans at TSYS come in two flavors: customized pricing and a number of Simplified Pricing Packages. TSYS discloses no information whatsoever about customized pricing on its website, with rates being highly variable and subject to negotiation. Customized pricing appears to include options for either tiered pricing or interchange-plus. Be sure to ask for interchange-plus pricing if you set up your account with customized pricing. Customized pricing is a better option for larger, high-volume businesses and generally offers lower processing rates than the simplified plans.
The Simplified Pricing Plans are designed for smaller businesses and feature three different plans: the Pursue Plan, the Grow Plan, and the Accelerate Plan. Here’s the details of each plan:
- 2.5% + $0.20 per transaction swiped rate (for qualified transactions)
- 3.5% + $0.20 per transaction keyed-in rate (for qualified transactions)
- $9.95 monthly service fee
- EMV, NFC, and Apple Pay capable credit card machine/reader included
- No setup fees
- No minimum card volume required
It’s very important to understand that although this is advertised as a flat-rate pricing plan, it’s actually a simplified tiered plan. Flat-rate pricing plans don’t distinguish between “qualified” and “non-qualified” transactions, and charge the same rate for both types of transactions. The non-qualified rates are not disclosed, and their existence is only disclosed in a very fine print footnote. Here’s the actual fine print from their website:
All terms and conditions, pricing and service options subject to change at any time.
Card-swiped rate applies to qualified swiped Visa/MC/Discover network transactions. Most rewards, corporate and special card types are not considered qualified.
All Visa/MC/Discover network transactions that do not meet the requirements for card-swiped and or key entered rates will be charged a non-qualified rate.
- 1.99% + $0.20 per transaction swiped rate (for qualified transactions)
- 3.1% + $0.20 per transaction keyed-in rate (for qualified transactions)
- $19.95 monthly service fee
- EMV, NFC, and Apple Pay capable credit card machine/reader included
- No setup fees
- $100,000 annual minimum card volume required
- 1.7% + $0.20 per transaction swiped rate (for qualified transactions)
- 3.0% + $0.20 per transaction keyed-in rate (for qualified transactions)
- $49.95 monthly service fee
- Tablet POS, card reader, cash drawer, and printer included
- No setup fees
- $250,000 annual minimum card volume required
While the Pursue and Grow plans are a fairly good deal for small businesses, if your business is large enough that you’re processing over $250,000 per year, the Accelerate plan is not such a good deal. You’ll be better off with customized pricing, as you can almost certainly negotiate better rates than this. Crunch the numbers and see what works best for you.
If you do choose to go with customized pricing, be sure to negotiate an interchange-plus pricing plan. You should also ask to have the early termination fee waived. Lastly, you can also ask to have the monthly minimum waived, although if your processing volume is high enough to take advantage of customized pricing, you probably don’t need to worry about meeting the monthly minimum. If you need help determining what rates would be fair for your business, let us know!
TSYS claims that their simplified pricing plans come with no hidden fees. They specifically state that you won’t be charged setup, non-qualification, inactivity, or application fees. While this is undoubtedly true, it doesn’t mean that you won’t have to pay any additional fees at all. You can still expect to pay fees for things like chargebacks and voice authorizations, among others.
Fees under the customized pricing option are not disclosed at all. Obviously, this leaves plenty of room for negotiation on your part, and you’ll want to go over every possible fee before you sign up. As always, it’s extremely important that you read your entire contract before signing it.
Contract Length and Early Termination Fee:
Regardless of whether you’re using simplified or custom pricing, all merchant account contracts with TSYS include a three-year term and an automatic renewal clause that extends the contract in one-year intervals thereafter. All contracts also include an early termination clause which imposes a $250.00 early termination fee if you close your account before the term has expired.
Obviously, you’ll want to have the early termination clause waived before you agree to sign up. Be sure to get it in writing and keep a copy of the waiver – just in case. You should also be aware that removing the early termination clause does not give you a true month-to-month contract. While you’ll be able to close your account without penalty, you’re still technically on the hook for the full three-year term. We’ve seen numerous complaints from merchants alleging that their processor continued to automatically charge them monthly fees for months after they thought their account had been closed.
If you do end up in a situation where you have to close your account early, follow the instructions in your contract to the letter. Most providers require at least 30 days’ notice (sometimes as many as 90 days), and written notice. You’ll also want to return your equipment promptly. I recommend using certified mail to ship your terminals back so you can get a receipt confirming that the equipment was received.
Sales and Advertising Transparency:
As a vehicle for advertising the company’s products and services, the TSYS Merchant Solutions website has both good and bad features. Disclosure of the simplified pricing plans is a plus, although as we’ve discussed above, it’s also misleading in that it’s actually a simplified tiered pricing plan, not a true flat-rate plan. Custom pricing is, of course, highly variable and subject to negotiation, so it makes sense not to go into specifics on the website. At the same time, a discussion of pricing models and some mention of the availability of interchange-plus pricing would be nice to see.
On a more positive note, TSYS does not rely on independent sales agents to market their services, using a fully-trained staff of in-house sales representatives instead. While this doesn’t provide an iron-clad guarantee that you’ll get top-notch service and a full disclosure of contract terms, it does improve the odds considerably. It’s far easier for TSYS (or any other processor) to monitor the performance of in-house employees and ensure that they’re following the company’s sales policies.
TSYS Merchant Solutions has a robust social media presence, with accounts on Facebook, Twitter, Google+, and LinkedIn. They also have a YouTube channel. All of these accounts are updated fairly frequently, and the YouTube channel in particular features a number of testimonials and merchant education videos.
Customer Service and Technical Support:
TSYS offers customer service and support through email and a 24/7 telephone line. They do not currently offer a chat feature. As with most companies offering 24-hour telephone support, you’re most likely to connect with someone who can actually solve your problem if you call during normal business hours. Outside of that, you’ll probably be connected to an outsourced customer service representative who will take your message, but probably won’t be able to solve your problem.
If you peruse through our readers’ comments below, you’ll see that poor customer service is a common complaint. While this is an issue with most merchant account providers, it’s particularly acute with a company as large as TSYS. While they clearly have the financial resources to improve the quality of their customer service, they simply haven’t done it.
Self-service options are also available, and seem to have improved since our last review update. The TSYS Merchant Solutions website includes a handy Resource Center section that features a number of educational articles and posts. The Resource Center also has a Troubleshooting section that includes a number of How-To Guides for diagnosing and solving equipment-related issues.
Negative Reviews and Complaints:
TSYS Merchant Solutions has been accredited by the BBB since 2010, and currently has an A- rating. The company has 60 complaints filed against it within the past three years, of which 18 were filed within the past twelve months. This is a remarkably low number for such a large processor, and represents a notable decline in complaints since our last review update. While TSYS was only able to resolve the complaint to the consumer’s satisfaction in about one-third of the complaints, they did respond to every single one.
This is a pretty impressive performance, especially for such a large processor. Less impressive is the disclosure that the company was recently fined $4.5 million by the Consumer Financial Protection Bureau (CFPB) and ordered to pay nearly $28,000,000 in restitution for deceptive practices relating to Consumer Credit Monitoring and Debt Cancellation products they were selling. While this government action doesn’t appear to be related to merchant accounts or credit card processing, it’s certainly very damaging to TSYS’ reputation. Ironically, the company was recently selected by the Ethisphere Institute as one of the World’s Most Ethical Companies for 2016. I guess they won’t be on the list for 2017.
- Early termination fees. There were a number of complaints from merchants who were charged a $250 early termination fee despite having a signed waiver in their contract. This can happen due to a miscommunication – or a lack of communication – between the sales representative who set up the account and the billing department. If this happens to you, insist on a refund and provide a copy of your waiver. You’ll get your money back. Also, beware of the automatic renewal clause in your contract. If you wait too long to notify TSYS that you’re closing your account, you’ll be on the hook for another year. When there are many other merchant account providers that don’t charge an ETF or lock you into a long-term contract at all, it becomes hard to justify signing up with TSYS.
- Billing issues. This may be the most common issue I saw. A number of merchants have complained about being billed monthly fees after requesting to have their accounts closed. While I find this entirely unacceptable, I am at least glad to report that they seem to offer refunds in many cases. Still, keep your eye on your bank account when you end your TSYS contract.
- Expensive terminal leases. While TSYS seems to be moving toward selling their terminals outright, there are still a lot of complaints from merchants who were signed up for a 48-month non-cancellable lease. Whether you stick with your lease for the entire four years or cancel early, you’ll pay the same: thousands of dollars for a machine that you can purchase outright for only several hundred dollars.
Positive Reviews and Testimonials:
You’ll find seven video testimonials on the TSYS website, all of which seem genuine and realistic in terms of the comments made (even if much of it is not really useful information). While it is of course an extremely small sampling of all TSYS customers, I do appreciate seeing a few satisfied customers speaking about their experiences. The interviewed merchants cited low rates and excellent customer service as two of the best features of TSYS. While this may seem ironic considering what we’ve had to say about their rates and customer service, remember that people are easily a hundred times more likely to complain than they are to praise. If you’ve had a positive experience with TSYS, please let us know about it in the Comments below.
Final Verdict on TSYS Merchant Solutions:
Overall, TSYS makes the grade as a viable payment processor. They offer a full range of products and services for just about any kind of business, and their pricing models are flexible enough to be a good fit for large and small merchants alike. Their very low complaint volume relative to their size is a strong indicator that the majority of their merchants are happy with their service, even if they don’t take the time to offer any positive comments about it online.
At the same time, TSYS is far from perfect. Their simplified pricing system isn’t such a great deal for small businesses, and larger businesses will definitely save money by going with custom pricing. Also, don’t be fooled into thinking that the simplified pricing rates are flat-rate. They’re actually a tiered pricing model, albeit a very simplified one. You’ll still get hit with higher rates for non-qualified transactions.
If you do consider signing up with TSYS, ask about customized pricing, regardless of the size of your business. While it’s probably more cost-effective for larger businesses, it can also be a better deal for smaller businesses if your sales representative offers you lower rates than those available under the simplified pricing plans.
While TSYS has a fairly transparent website, it would be a lot better if it included some discussion about the availability of interchange-plus pricing. I’d also like to see some disclosures about fees under the customized pricing option, as there currently aren’t any. TSYS could also improve the overall value of their service by following the growing trend within the industry and eliminating both the early termination fee and the three-year contract term. With so many of their competitors already offering true month-to-month contracts, they need to make this change as soon as possible. Overall, TSYS Merchant Services rates 4 out of 5 stars. They’re a solid choice, but be sure to negotiate aggressively and review your contract before you sign up.