Is it safe to do business with companies that don’t take credit cards?
Don’t you find it a bit bizarre that some larger companies don’t take credit cards? That gets me wondering. Why do they not take credit cards? Did they lose their privilege due to too many charge-backs? Or, did they cancel their account themselves due to far too many charge-backs?
Think about it. If you are running a shady business where there are many disputes, people will often want their money back. What if you are in some type of software contracting where you take deposits? I have given deposits to many companies who took deposits seemingly to keep me as a hostage. They promised to do work at a particular speed, but, they moved at the speed of a snail after being paid. Taking deposits is a trick to make it too expensive to dump them in the middle of a project if they move too slowly. That way you are invested in them, but they are not invested in you. Very tricky.
If your deposit was made with a credit card you can dispute the charges and claim that there was fraud.
But, what if you pay with paypal?
If you pay with paypal, you can do a reversal on a purchase that has a shipping tracking number. However, the reversal will show up on your profile for everyone to see. Many companies will not do business with you if you have any reversals. If you have paid 100 merchants with your paypal, but only did one reversal for a “good reason”, perhaps others will overlook this transgression. Basically, if someone cheats you after you pay them with paypal, your reputation is ruined the minute you do a charge-back. But, with credit cards, nobody will ever know! In any case, the seller can prevent you from doing a reversal using paypal simply by giving paypal a phone call if there is a dispute.
What if you pay by check?
If you pay someone by check, there are no reversals. The money is gone unless they give it back to you or you sue them. If you pay unknown vendors by check for a deposit, you are just handing them your cash on a silver platter with no guarantees
of anything.
The bottom line
I do business with IT companies, and finding a reputable one that does good work is like finding a needle in a haystack. If I used paypal and did a chargeback each time I was cheated, I would have more reversed transactions than real transactions. So, I just let them keep the money if they cheat me. I don’t want to ruin my credibility over a small dispute over $1500 or $2000.
My recent experience
I found out why a particular company I’m dealing with doesn’t accept credit cards. They don’t deliver on time. I paid in advance and am waiting forever for service. The quality of their service is excellent when they deliver, but their priority are their larger and more steady clients, not me. Be careful!