Processing $1,000 per month or less in card payments?
- Date Established
- Palo Alto, CA
- Good developer tools
- Good marketplace tools
- Chip card hardware
- No setup or application fees
- Good for low-volume merchants
- No pricing disclosed online
- Account stability issues
Who remembers the Occupy Wall Street protests from the autumn of 2011? Although I certainly do, I was unaware of the massive crowdfunding operation behind this movement. That is, until I came across its chosen payment processor: WePay.
WePay has exuded a plucky, anti-establishment vibe since its early days. The payment facilitator was founded in 2008 by Rich Aberman and Bill Clerico as an alternative to PayPal for peer-to-peer payments, dues collection, and fundraising. WePay has shifted to a more behind-the-scenes role now, as you’ll see. Throughout its evolution, WePay also underwent multiple rounds of fundraising on its own behalf, amassing over $75 million in venture capital.
WePay is a third-party payment facilitator (rather than a direct merchant account provider), placing it in the same broad category as companies like Stripe, PayPal, and Square. As you’d imagine, this is an extremely competitive space. Currently, WePay styles itself as the “payments provider to the platform economy.”
Let’s take a moment to define that buzz word — platform economy. First of all, we’re talking about software platforms, not the physical kind made of wood or metal. We’re referring to any online space where lots of business owners, sellers, or fundraisers go to conduct some aspect of their business. Here are the some of the types of platforms WePay partners with, along with an example of each:
- Event Management (ConstantContact)
- Accounting/Invoicing (FreshBooks)
- eCommerce/Shopping Carts (Ecwid)
- Fundraising (GoFundMe)
So, say you are a merchant who uses the FreshBooks software platform for your accounting and invoicing needs, but you also need a way to actually accept credit cards for your invoices. Or, what if you are managing a list of attendees for a conference in ConstantContact, but need a way to collect payment from those attendees? Or, maybe you’ve got an online shop all set up via Ecwid, but you still need to decide how you’re going to accept payments from your customers.
This is just where WePay comes in. WePay’s goal is to have its payment facilitating capability already embedded inside these platforms that merchants use every day. Merchants can then quickly and easily start accepting payments without ever leaving the software platform they were already using to manage their businesses. As a small business owner, you can’t sign up for WePay in isolation, like you might PayPal or Stripe. Instead, you’d only encounter WePay if you happened to use one of its partnered platforms.
WePay takes this specialization in platform partnerships even further. Aside from exclusively embedding payments directly into platforms, it also supplies each software platform with its own, self-branded payment solution. For example, WePay’s partner Ecwid now offers a payment solution called “Ecwid Payments, Powered By WePay.”
WePay calls this setup “white-label” payments for platforms, and it provides certain advantages to the platforms themselves, to the merchants who use the WePay-powered payment solution inside these platforms, and even to the end-user making the payment. We’ll touch on these benefits throughout the review. Meanwhile, this strategy to scale business by infiltrating platforms has benefited WePay as well — it’s made Inc. 500’s list of America’s fastest-growing private companies the last couple of years.
Although facilitating fundraising for Occupy Wall Street originally put WePay on the map, the latest twist in WePay’s story came at the end of 2017 when it was bought by one of the biggest banks in the world — JP Morgan Chase. Whether or not this means WePay has officially sold out to The Man, there’s no escaping the obvious irony.
Changes are undoubtedly afoot as the acquisition unfolds, so we’ll be keeping an eye out for further shifts in WePay’s strategy. As of now, WePay has not been completely spared from grappling with common issues among all payment facilitators (held funds and account instability, for example). Still, more and more platforms are deciding white-label payments is the way forward, and many choose WePay for that specialization. I admire WePay’s refusal to quit amongst such entrenched competitors, but I’m not 100% convinced it’s even got itself figured out yet!
It’s worth pointing out that the audience for this review will likely be split between platforms owners who might partner with WePay and the merchants who use these software platforms. If you don’t find yourself in either of these two categories but still need card processing services, I’d suggest checking out our top merchant account providers.
There’s no denying that the intervening layers of the platform economy make reviewing WePay a bit of a hairy endeavor. Nevertheless, I’m confident we’ve gathered some good information to help you decide if WePay is worth considering for your situation.
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Table of Contents
Products & Services
As you read about WePay’s features, don’t forget that WePay targets the platform owners themselves, not merchants using the platforms. Similar to WePay’s website, this section of the review is written so platform owners can understand what WePay offers. Still, I think merchants will benefit from knowing more about how platform payments work. I would not recommend skipping this section — or any section for that matter!
WePay’s website is sparse on descriptions of specific products and features. They’re more interested in explaining the overall value proposition of integrated platform payments. Here is my crack at summarizing WePay’s key offerings for platforms:
- Payment Processing: WePay is a third-party processor like Stripe or Square, as opposed to a traditional merchant account provider. The website still states that merchants using WePay inside a platform must be U.S.-based, although end-customers can be international. However, merchant agreements for the UK and Canada have now been added to the Terms of Service page.
- “White-label” Payments: As a platform, you’ll get your own, self-branded payment solution when you partner with WePay, without the hassle of actually becoming a payment facilitator yourself. Your brand-name payments service will still probably have “Powered by WePay” as part of its logo. I like to think of it as more of a “gray-label.” Another common industry term is co-branded.
- Developer Documentation/API: WePay describes itself as a “payments API company.” As such, the developer section of the website is the best place to find concrete information about WePay’s capabilities and how they can be customized to suit your needs.
- Simultaneous On-boarding: Merchant on-boarding to WePay as the software’s in-house payment provider becomes part of the same processes as on-boarding to the software platform itself. On the back-end, WePay accesses the same merchant data used for the platform’s primary merchant on-boarding system, thus removing friction on the front-end for merchants eager to make their first sales. As the Account Creation Overview explains, the partner platform even has the option to automatically set up WePay for all new merchants, with further verification steps after merchants are already happily selling away.
- Revenue From Payments: Platforms may have the opportunity to negotiate with WePay to split transaction fee revenue from integrated payments, as well as add their own markups. See more on this in the Fees & Rates section of this review.
- Risk Management & Fraud Protection: While extra fraud protection is needed in the multi-sided platform economy, the competing danger is erecting additional barriers to both merchant onboarding and legitimate sales. It’s not entirely clear how the nuts and bolts of WePay’s protective systems work, but the important point is that WePay shoulders the responsibility of risk, security, and regulatory compliance on behalf of its partnered platforms. Since the platform and WePay are intimately connected in their sharing of data, managing issues such as chargebacks ought to work better than with a bolted-on payment provider. As you’d expect from a large payment company, WePay is certified as a Level 1 PCI Compliant Service Provider.
- Mobile Point Of Sale (mPOS): WePay enables white-label, mobile POS for platforms, and merchants eventually use the platform’s app and mobile hardware down the line to collect payments. Here again, I’d refer you to the mPOS developer section of WePay’s site for the best information. A few highlights:
- Customizable EMV-certified Card Readers: Chose between the Moby 3000 reader or PCI-certified RP350x, both by Ingenico/ROAM. (I couldn’t help but snicker at the fact that the “white-label” in this case is a literal sticker with the platform name on top of the Ingenico label!)
- iOS & Android SDKs: Integrate payments into the platform’s mobile app.
- Fulfillment Service: This lets the platform ship readers directly from WePay’s warehouse to merchants.
- Apple Pay & Android Pay: Add this capability on the platform’s regular website in addition to the mobile app.
Fees & Rates
To discuss pricing, we need to split our focus between merchants and platforms. With the overall vagueness of WePay’s site, I’m not terribly surprised that no pricing information is provided. At an archived version of their pricing page from 2016, we see that WePay once published rates of 2.9% + $0.30 for platforms. This flat rate is industry-standard for this type of payments provider, although some payment facilitators offer separate pricing setups for complex platforms (see Stripe Connect for an example). For a general refresher on pricing for credit card processing, check out our complete rate and fee guide.
I’m guessing the removal of pricing from the website came in tandem with WePay’s decision to only offer white-label payments. While 2.9% + $0.30 may still be the go-to-market rate for WePay’s processing, larger platform companies have flexibility to negotiate with WePay for a cut of processing costs. WePay is plenty motivated by access to a giant plaftorm’s-worth of merchants, and the platform unlocks the opportunity to generate additional revenue from payments as part of the deal.
By the same token, each platform is free to develop its own overall pricing structure to inflict on its merchant pool. These pricing structures are as varied as the platforms themselves. Platforms may charge monthly fees, extra transaction and/or service fees beyond WePay’s, or even discounted transaction fees. Your best bet as either a platform company or a merchant is to keep the 2.9% + $0.30 baseline figure in mind as you explore payments options in your particular industry.
Let’s do one real-life example for fun. Here is pricing for one of WePay’s partners, an ecommerce platform called Ecwid (see our review).
Let’s say you’re a merchant ready to set up your online store via the Ecwid platform. You can see above that Ecwid charges merchants increasing monthly fees for premium packages. Transaction fees are set to $0, but only because Ecwid has chosen to forego charging its own transaction fee or percentage “service fee” on top of its monthly fee. In the end, your transaction fee as a merchant is most definitely not $0. Instead, the amount will depend on which payment provider you choose.
Enter “Ecwid Payments.” While it turns out that Ecwid supports a whole slew of payment providers, including Stripe and PayPal, let’s see what happens if you chose Ecwid Payments Powered by WePay:
We see the processing deal sweeten with Ecwid Payments as we progress in plan level. In contrast, you’d probably be stuck with the default pricing offered by any of the other bolted-on payment options. What we can’t see is exactly how WePay and Ecwid split transaction fees. It’s conceivable that WePay only collects 2.75% + $0.30 (or possibly even less) no matter the Ecwid plan, and Ecwid keeps the difference. We’re left to speculate, but the point is that any number of arrangements may operate behind the scenes when it comes to WePay’s platform pricing.
Before we move on, I want to quickly mention a couple of other notable fees. Back in In 2015, WePay introduced a rate of 1% + $0.30 for ACH payments via partner platforms (and it was still listed on that 2016 page too). While I’ve seen this special bank transfer payment rate offered at a couple of WePay-associated platforms, it’s certainly not widely advertised. I have a feeling separate ACH pricing will depend on individual contracts between the platform and WePay. Meanwhile, chargeback fees and ACH reversal fees are listed at $15 in the terms of service.
Contract Length & Early Termination Fee
Here, we’ll mainly focus on the merchants using WePay’s partnered platforms. I’m sure the platforms themselves have special contracts dictating their relationships with WePay, but we’re not privy to those. Instead, we have access to merchant “terms of service” agreements for the US, Canada, and the UK at the website.
These documents rightfully point out that even if a platform is offering white-label payments, the platform itself probably also has a separate merchant agreement with its own terms and conditions for use of the software. Bottom line: both the platform’s general-use agreement and WePay’s terms of service (just for payments) are important documents to understand.
Sections 27-30 of the WePay service agreement addresses account termination. As a merchant, you may cancel WePay’s payment service at any time with no early termination fee. While you’re looking through the rest of the terms, be sure also to note WePay’s policies on payout holds and account freezes, along with their Reserves FAQ. These are common points of contention and misunderstanding when it comes to merchant aggregators — WePay included.
Sales & Advertising Transparency
Now, we’re back to examining WePay’s relationship with platforms, since it doesn’t advertise directly to merchants anymore. I know, this is a lot of focus-shifting in one review. Don’t blame me — blame the multi-layered platform economy. Merchants should stay engaged for this section, though. You want to know what type of company you’re dealing with for payments, even white-label payments inside a platform.
Despite any shortcomings, WePay is not a sleazy, scammy, or dishonest company. I’m still disappointed that they don’t publish pricing anymore, especially when its more visible competitors do offer some hard figures. I hope this part of the website is in transition and that we’ll see some pricing bones thrown our way soon. While pricing may be complicated with platforms in the mix, WePay needs to figure out a way to increase online transparency on the pricing front.
The great news about fully-integrated payments with WePay is that merchants are spared from aggressive sales agents, flashy ads and gimmicky deals. It’s up to the software platform to “sell” its own co-branded payments provider over any others it may offer. I also like that WePay’s terms of service are clearly posted, and that the legalese therein is relatively smooth-reading. I do wish the website itself was just…well…better. And, with all pricing completely gone, I can’t rate WePay’s transparency higher than average for now.
Customer Service & Technical Support
In theory, WePay and its partnered platforms work together on behalf of merchants and their end-customers/donors to provide support. It should help that WePay and the platform have access to each other’s data and support records, and that both entities have a shared stake in keeping everyone happy. It’s all a great theory, but it makes you wonder how well it works in reality. The answer seems to be: it depends.
Whether you’re a merchant or customer, I don’t see a clearly established order for contacting the platform versus contacting WePay for support. WePay provides an email ticketing system, as well as the links to customer support pages for various platforms, all on its own contact page. You’re basically invited to make the decision yourself on which route to take. There are some complaints from merchants getting the run-around between WePay and the platforms, but fewer than I’d expected. Meanwhile, I’ve seen WePay instruct merchants to continue working with the platform if the issue is less payments-related, or if the merchant already had a support ticket open with the platform partner.
WePay’s “Customer Delight” team is available 9 AM to 9 PM EST Monday through Friday. Note that time frame refers to email ticket support only. WePay indicates they’ll respond to inquiries within one business day. Live chat was offered at one point, but has now vanished. The same goes for a phone number — gone. If you manage to dig up a WePay phone number (I found one inside a complaint), there is no option to talk to a live person. All five menu options simply redirect you to the website or an email address. I sort of understand why big merchant aggregators avoid phone support, but that doesn’t mean I have to like it.
I’ve already mentioned that the main website is a bit sparse on specifics, aside from the developer documentation. You’ll end up opening a lot of PDF “one-pagers” that are too vague to be helpful and would have worked better as posts on their blog. The Support Section has some decent FAQs and even answers a few common questions that tend crop up regarding their partner sites. WePay also maintains active Twitter and Facebook pages.
Negative Reviews & Complaints
WePay maintains an A+ rating with the BBB, with 16 negative “customer reviews” and 90 registered complaints in the last three years (27 in the last 12 months). That’s a fairly low number for a third-party processor that partners with at least 1,000 platforms-full of merchants. Even with additional negative feedback at sites like Ripoff Report and TrustPilot thrown in, this is also far fewer complaints than better-known competitors like PayPal or Stripe.
The difficulty in tracking WePay’s complaints is factoring in any flack the platforms themselves are absorbing for what may ultimately be WePay’s issues, or vice versa. My suggestion for merchants is to examine the complaint patterns for WePay and the specific platform in question side-by-side. Plus, there’s a good chance we’ve already reviewed the platform you’re interested in at Merchant Maverick.
With those caveats, here are some common WePay complaints:
- Withheld Funds: Holds related to “high-risk” transactions often resulted in account cancellation (see below). Relatedly, disputes over WePay’s reserve accounts also crop up occasionally. Several merchants reported delayed and inadequate explanations for holds and terminations.
- Frozen Or Terminated Accounts: After quick initial approval, some accounts were subsequently frozen or terminated. Merchants and WePay often disputed the proper interpretation of WePay’s business-type restrictions, or whether or not subsequent verification requirements were completed properly. Problems refunding payments to customers/donors sometimes ensued.
- Long Processing Time: Users were unhappy with the 2- to 5-day (or beyond) wait to receive funds when a “hold” was not in place.
- Canceled Transactions: We found reports of transactions moving from “pending” to “verification failed” status without warning. In some cases, WePay required buyers to approve purchases directly before completing transactions.
- Poor Customer Service: Along with general scoffing at “Customer Delight,” many merchants specifically pointed out the lack of phone support.
Despite WePay’s icy finger-pointing at PayPal in 2010, all third-party processors have account stability issues to some degree. That’s one side-effect of the approve-now-verify-later business model. There are signs that WePay accounts might be more stable overall than with some of its big competitors. White-label partnerships could be helping with that, or merely better-obscuring problems! It doesn’t hurt to read more about how to avoid holds, freezes, and terminations yourself.
This is a good time for another quick reminder to read both the platform’s and WePay’s terms and restrictions. Correspondence between the two depends on a number of factors, including the type and quality of platform, the merchant screening and on-boarding processes, whether additional payment providers are offered, and so on. High-risk merchants may need an alternate, specialized merchant account.
Positive Reviews & Testimonials
There’s no shortage of praise for WePay around the internet. Take the 33 positive reviews at the BBB and the 100+ 5-star ratings at TrustPilot as examples. Compared with complaints, a much larger percentage of “customer delight” is from end-users and donors. They often praise the help they received deciphering unrecognized charges on their credit cards, or resolving donation issues at crowdfunding sites. Over at the BBB, there’s a rep named Dan who has amassed numerous glowing accolades. Raise a glass to Dan, everyone!
The most common positive feedback from merchants is for quick and effective customer service. This makes sense, since merchants aren’t directly negotiating fees or dealing with sales reps when it comes to WePay. After reading about WePay’s customer support, I admit I was a bit surprised to learn that WePay’s Customer Delight department has won Stevie Awards.
To hear from the platforms themselves, we can turn to WePay’s website. Four video testimonials from partner platforms are accessed under the Customer Stories tab. Partners are also occasionally interviewed for blog posts. The platforms tend to highlight:
- Decreased friction in on-boarding merchants to payments (within minutes!).
- Increased merchant “stickiness” to the platform long-term.
- A general business boom after adding white-label payments.
- Customization and control of the user experience for payments.
- WePay’s niche understanding of platform needs.
- Freedom to trust WePay with payments and focus on platform management instead.
As a third-party payment facilitator, WePay has relentlessly sought its own niche among household names like PayPal and Stripe. We’ll watch how WePay’s focus evolves as the folks over at Chase Bank begin to exert influence, but we currently find all of WePay’s eggs in the platform economy basket. With such intense competition for market share, I think targeting platforms that pool together merchants was probably a wise move for WePay. In turn, WePay’s partnered software platforms and marketplaces appear to appreciate this specialization.
This doesn’t mean WePay has cornered the market on embedded, co-branded payments. Platforms can (and should) still shop around, and each platform must examine each payments provider in light of the platform’s own unique pool of merchants. This is where aspects like customer service, account stability, fraud protection, and geographical availability of the payment service come into play.
To make direct comparisons, you’d really have to look at the platform-embedded, co-branded version of each payment service. Teasing out that specific feedback may be impossible, but I can still offer some general observations. Although WePay has raised capital specifically for international expansion, other marketplace payment providers like Stripe, Braintree and Adyen still cover merchants in loads more countries. Direct account providers such as Braintree (read our review) offer better account stability and customer service than third-party payments providers, including WePay.
Stripe may be the closest comparison to WePay overall, and its far easier to find pricing and features for the former. WePay’s website is weak compared to most of its competitors, with a lack of specifics and visual examples. It takes lots of digging or a developer’s insight to understand WePay’s offerings. On the other hand, WePay does seem to handle customer service better than Stripe in the grand scheme, and has fewer total complaints.
To sum up, I don’t think WePay is a bad option for either platforms or merchants within those platforms. In its current state, I’m giving WePay 4 stars. Co-branded payments may be the way of the future, but WePay’s solution is not a magic bullet. I think it still pays to keep the payment field more open for now — for platforms to retain other bolted-on options, and for merchants/campaigners/sellers to set up more than one payment method if possible.
My main advice to merchants is to remember that the quality of a platform’s payment experience is directly tied to the quality of the platform itself, and that this is especially true when the two are co-branded. You can’t evaluate one without the other (which made it tough to review WePay by itself!). Understand the terms of service for WePay, as well as the platform it’s inside. Examine transaction fees for the payment solution within the context of platform’s overall pricing structure. Look at the features and reputation of both companies. I wish you the best of luck!
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