Payment Processing Services Terms
The terms of these Payment Processing Services Terms (“Payment Processing Terms” or “Terms”) will apply to Merchant’s use of and Fivestars’ provision of the Payment Processing Services. Any terms capitalized and not defined herein will have the meanings ascribed to them in the Merchant Agreement. 1. Services; Processing Partners. As used in these Terms, “Payment Processing Services” means the payment processing services offered by Fivestars that allows Merchant to accept credit cards, debit cards, and other payment methods for goods or services sold by Merchant, and such other services as are necessary or supplemental to such payment processing services. Fivestars has engaged a payment processor (“Processor”) that provides support for the Payment Processing Services. As of the date of these Payment Processing Terms, the Processor is either Worldpay LLC or First Data Merchant Services LLC. Processor may be changed at any time without notice to Merchant. In addition, Processor is sponsored by one or more member of the Visa, Mastercard, and/or Discover networks (“Card Networks”), as applicable, that provides sponsorship services for the Payment Processing Services. As of the date of these Payment Processing Terms, the bank providing sponsorship services in connection with Fivestars’ provision of the Payment Processing Services and as a member of one or more of the Card Networks (“Member Bank”) is Fifth Third Bank, an Ohio banking corporation, for Merchants boarded with Worldpay LLC, and Wells Fargo Bank, N.A., for Merchants boarded with First Data Merchant Services LLC. The Member Bank may be changed at any time without notice to Merchant. Merchant understands and agrees that Fivestars may share any of Merchant’s Confidential Information or other information with such Processing Partners and that such disclosure will not be considered a breach of the Merchant Agreement.
2. Merchant Underwriting and Identification.
a.) Merchant authorizes Fivestars, directly or through affiliates or contractors, to perform a review of Merchant’s principals, finances, activities, and operations that Fivestars deems necessary and appropriate (i) prior to providing Payment Processing Services and, (ii) periodically, as determined by Fivestars, throughout the Term of the Merchant Agreement. Merchant agrees to provide Fivestars with such information as Fivestars may reasonably require in connection with such review and authorizes Fivestars to retrieve information from Fivestars’ service providers, including credit bureaus and information bureaus. In addition, Merchant authorizes Fivestars to share such information with (i) Member Bank and Processor; and (ii) their respective affiliates and service providers as necessary to provide the Payment Processing Services. Without limiting for foregoing, Merchant agrees to cooperate with Fivestars to obtain any additional authorizations from Merchant’s principals and beneficial owners as may be required for Fivestars to obtain credit reports about such principals and beneficial owners.
b.) To help the government fight the funding of terrorism and money laundering activities, applicable law may require Member Bank, Processor, Fivestars, or the Card Networks to obtain, verify, and record information that identifies each person who receives access to the Payment Processing Services. Accordingly, Merchant shall, when requested, provide to Member Bank, Processor, Fivestars, or the Card Networks, as relevant, documentary and other evidence of Merchant’s identity or the identities of its beneficial owners and principals, so that Member Bank, Processor, Fivestars, or the Card Networks may comply with any applicable law or regulation, or Rules. Without limiting the foregoing, Fivestars must obtain through underwriting the identifying information of the beneficial owners of 25% or more of Merchant and at least one individual with significant control over Merchant.
3. Fees; Designated Account; ACH Authorization; Reserve Account.
a.) Fees. Fivestars’ current list of per-Transaction rates and fees are listed in the schedule listed at https://hi.fivestars.com/payment-fees.html (or a successor URL provided by Fivestars), unless otherwise agreed to and set forth in an Order Form (“Rate List”). In exchange for receiving the Payment Processing Services, Merchant agrees to pay the fees stated on the Rate List, including applicable transaction and chargeback fees, or the fees otherwise stated on the applicable Order Form (“Payment Processing Fees”). Fees on the Rate List will be charged starting the first day of the term of any applicable Order Form. Fivestars may change the fees listed on the Rate List upon renewal of the applicable Order Form by providing Merchant with notice of such changes within forty-five days of the end of the then-current term. Fivestars may also change its fees at any time upon thirty (30) days’ prior written notice to Merchant if a Processor, Member Bank, or Card Network changes the fees it charges to Fivestars.
b.) Designated Account. Merchant will set up and maintain a deposit account (“Designated Account”) for Fivestars, Member Bank, and/or Processor to deposit the proceeds of sales transactions between Merchant and a Consumer related to Merchant’s sale of goods and/or services to the Consumer (“Transactions”) and to offset or debit any amounts owed to Fivestars, Member Bank, or Processor. Merchant will not change the Designated Account with obtaining written consent from Fivestars. Merchant’s failure to maintain the Designated Account with sufficient funds to satisfy all obligations to Fivestars, Member Bank, or Processor contemplated by these Terms may result in Fivestars’ immediate suspension of Merchant’s access to the Payment Processing Services and/or termination of the Merchant Agreement. Notwithstanding the foregoing, if the Payment Processing Fees and other amounts owed under these Terms or an ACH debit for such amounts causes the balance in the Designated Account to be less than zero ($0), Fivestars, Member Bank or Processor, as applicable, may (1) charge an overdraft fee; (2) require that Merchant make a wire transfer to the Designated Account within one (1) banking business day of notice; (3) collect under any guaranty, or (4) take any other action authorized by law.
c.) Payment. Subject to the terms of these Payment Processing Terms, Fivestars shall send or instruct Member Bank or Processor to send to Merchant’s Designated Account all amounts due Merchant from Merchant’s Transactions, minus any amounts owed to Fivestars, Member Bank or Processor under these Payment Service Terms.
d.) Other Amounts Owed. Merchant will be liable to Fivestars for any fees, charges, or other amounts incurred by Fivestars in connection with these Terms, including but not limited to: (i) chargebacks, reversals, invalidated payments, or refunds; (ii) amounts incurred attributable to unauthorized use of or access to Consumer data or other information in Merchant’s systems; (iii) fraudulent use of Merchant’s terminal identification numbers; (iv) fines and penalties imposed by a Card Network, or a regulatory or law enforcement agency; (v) non-sufficient funds fees; and (vi) ACH debits that overdraw the Designated Account or Reserve Account (defined in Section 4 of these Terms) or are otherwise dishonored.
e.) ACH Authorization. Merchant authorizes Fivestars, Processor, and Member Bank to initiate ACH credits and debits to the Designated Account and the Reserve Account (defined in Section 4 of these Terms). This authorization will remain in effect after termination of the Merchant Agreement and until all amounts owed to Fivestars, Processor, and Member Bank are paid in full. In the event Merchant changes the Designated Account such authorization shall remain in full force and effect until thirty (30) days after Fivestars receives written notification from Merchant of termination of the ACH authorization. In the event Merchant changes the Designated Account in accordance with Section 3(a) of these Terms, this authorization will apply to the new account. Without limiting any provision of this Section 3(e), in the event that setoff against payments made to Merchant are not sufficient to cover the Payment Processing Fees and other amounts due under these Terms, Merchant agrees that Fivestars, Processor, and/or Member Bank may initiate an ACH debit to the Designated Account for such amounts. Merchant also agrees that upon providing ACH payment information, Fivestars will have the right to charge Merchant using the ACH system for any services provided to Merchant by Fivestars. ACH means the Federal Reserve System's Automated Clearing House (“ACH”) system.
f.) Taxes. Merchant shall pay, indemnify, and hold Fivestars harmless from (i) any sales, use, excise, import or export, value-added, or similar tax or duty, and any other tax or duty not based on Fivestars’ income, and (ii) all government permit fees, customs fees, and similar fees which Fivestars may incur with respect to these Terms. Such taxes, fees, and duties paid by Merchant shall not be considered a part of, a deduction from, or an offset against, payments due to Fivestars hereunder.
g.) Reserve Account. In their respective sole discretions, Member Bank, Processor, or Fivestars may require Merchant to establish and maintain a deposit account, held at Member Bank, as security for Merchant’s current and future obligations under these Terms (the “Reserve Account”). Member Bank, Processor, or Fivestars shall determine the amount of such Reserve Account and Merchant agrees to deposit that amount in the Reserve Account. Merchant also agrees that Member Bank, Processor and/or Fivestars (i) may initiate ACH debits to the Designated Account; or (ii) withhold amounts that would otherwise be paid to the Designated Account on Merchant’s behalf, for the purpose of establishing, maintaining, or increasing the Reserve Account. Member Bank, Processor or Fivestars may, without notice to Merchant, apply deposits in the Reserve Account against any amounts owed by Merchant under these Terms. By executing these Terms, Merchant grants to Fivestars, Processor, and Member Bank a security interest in the funds held in the Reserve Account. Funds held in the Reserve Account shall remain in the Reserve Account until twelve (12) months (or for such longer period of time as is consistent with Member Bank’s or Fivestars’ liability for Transactions in accordance with the Rules) following the later of termination of these Terms or Merchant’s last submission of Transactions for processing, provided, however, that Merchant shall remain liable for any liabilities under these Terms occurring beyond such twelve-month or longer period. Member Bank shall have sole control of the Reserve Account and Merchant agrees not to use funds in the Reserve Account for another purpose or withdraw such funds without Member Bank’s written consent.
4. Merchant Responsibilities
a.) Ownership of Devices. Merchant warrants and represents that, as to any computers or other electronic devices on which it uses Payment Processing Services, Merchant either owns such devices or has authority to grant rights of access and use to Fivestars for any and all purposes, including rights of access and use necessary or related to the provision of the Payment Processing Services. Merchant hereby authorizes and grants permission to Fivestars to access and use each computer or electronic device on which Merchant may use the Payment Processing Services, and hereby grants Fivestars any and all rights of access and use for the purpose and to the extent reasonably necessary or appropriate to facilitate the processing of payments by Fivestars or to enable other features of the Payment Processing Services. This includes, without limitation, permission and authorization to access and to use Merchant’s computers and electronic devices to install such applications or software as is necessary for the Payment Processing Services to operate on Merchants computers and devices, including but not limited to Merchant’s permission and authorization to modify Merchant’s computers and electronic devices through the installation of software related to the Payment Processing Services. Merchant acknowledges and agrees that the access and use granted to Fivestars under this agreement may result in the displacement, substitution, or modification by Fivestars’ Payment Processing Services of other similar applications, software, or services provided by third parties, including by third parties that provide services similar to the Payment Processing Services, and Merchant hereby consents and affirmatively approves the displacement, substitution, or modification of these other applications, software, or services provided by third parties as necessary for the Payment Processing Services to operate properly on Merchant’s computers and devices.
b.) Transactions. Merchant agrees to submit through the Payment Processing Services only Transactions that are authorized by its Consumers. Merchant shall not process Transaction on behalf of any other entity or individual. Merchant shall not submit Transactions for any purposes related to any illegal or prohibited activity, including but not limited to money-laundering or financing of terrorist activities; the sale of marijuana or marijuana products; the sale of alcohol without proper ID verification; the sale of sex or sex related services; human trafficking; or, the sale of firearms without proper ID verification.
c.) Compliance with Laws and Rules.
1) As used in these Terms, “Rules” means the written rules, regulations and procedures issued by the Card Networks, including, without limitation, the Payment Card Industry Data Security Standard (“PCI DSS”), the Visa Customer Information Security Program, the MasterCard Site Data Protection Program, and any other program or requirement that may be published and/or mandated by the Card Networks or other relevant payment networks; and, the rules, regulations, and procedures of any processors, banks, or other institutions or organizations which govern or affect Merchant’s use of the Payment Processing Services. Merchant may review the Visa, MasterCard, and American Express websites and may contact Discover for a copy of each of their respective rules and regulations. As of the date of these Terms, the websites are: (Visa) https://usa.visa.com/support/small-business/regulations-fees.html; (MasterCard) https://www.mastercard.us/en-us/about-mastercard/what-we-do/rules.html; (American Express) https://icm.aexp-static.com/Internet/NGMS/US_en/Images/MerchantPolicyOptBlue.pdf; and (Discover) https://servicecenter.discoverglobalnetwork.com/onlineform/en-us/contact-us.
2) You agree to comply with all Rules. The Rules are incorporated into these Terms by reference as if they were fully set forth herein. You further agree to comply with all state, federal, and local laws, rules, and regulations applicable to Merchant’s business (“Laws”), as amended from time to time, including but not limited to anti-money laundering laws and regulations, provisions of the Bank Secrecy Act (BSA) for which Fivestars or Member Bank may require your compliance, regulations and guidance promulgated by the U.S. Treasury’s Office of Foreign Assets Control (OFAC), and the consumer protection laws and regulations enforced by the Federal Trade Commission and other applicable federal and state regulatory or enforcement agencies. You will assist Fivestars, Processor, and Member Bank in complying with all Laws and Rules now or hereafter applicable to any Transaction subject to these Terms. The Card Networks, Member Bank, and Processor have the right to conduct on-site Merchant visits or to otherwise contact you directly to ensure compliance with all of the requirements in the Rules. You are responsible for demonstrating compliance with the Rules and Laws.
3) Without limiting Merchant’s requirement to comply with the Rules, Merchant agrees to comply with all applicable data privacy and security requirements under PCI DSS with regard to Merchant’s collection, use, access, and storage of Consumer data, financial account data, and certain payment card non-public personal information in connection with the Payment Processing Services, including but not limited to undertaking the required annual or quarterly self-assessments and web infrastructure scans, as appropriate. Additionally, Merchant agrees to comply with its obligations under any applicable law or regulation as may be in effect or as may be enacted, adopted, or determined regarding the confidentiality, use, and disclosure of Consumer data and financial account data. Merchant agrees to indemnify and reimburse Fivestars for any loss, liability, assessment, or fine incurred due to Merchant’s breach of this Section 5(b)(3).
d) Prohibited Activities. Merchant must not:
- Require a Consumer to complete a postcard or similar device that includes the Consumer’s account number, card expiration date, signature, or any other card account data in plain view when mailed;
- Require a Consumer to provide personal information, such as a home or business telephone number, home or business address, or a driver’s license number as a condition for honoring a card, unless permitted under the Laws and Rules.
- Add any tax to Transactions, unless applicable law expressly requires that a Merchant impose a tax (any tax amount, if allowed, must be included in the Transaction amount and not collected separately);
- Add any amount to the posted price of goods or services you offer as a condition of paying with a card, except as permitted by the Rules.
- Request or use an account number for any purpose other than as payment for its goods or services;
- Disburse funds in the form of travelers checks if the sole purpose is to allow the Consumer to make a cash purchase of goods or services from Merchant;
- Disburse funds in the form of cash unless Merchant is dispensing funds in the form of travelers checks, TravelMoney cards, or foreign currency (in such case, the Transaction amount is limited to the value of the travelers checks, TravelMoney cards, or foreign currency, plus any commission or fee charged by the Merchant), or Merchant is participating in a cash back service.
- Submit any Transaction receipt for a Transaction that was previously charged back to the Member Bank and subsequently returned to Merchant, irrespective of Consumer approval;
- Accept a credit card issued by a U.S. issuer to collect or refinance an existing debt;
- Accept a card to collect or refinance an existing debt that has been deemed uncollectable; or
- Submit a Transaction that represents collection of a dishonored check.
Merchant also understands and agrees that it is not, under any circumstances, permitted to sell goods or services that are prohibited by the Processors or Card Networks as stated at https://hi.fivestars.com/prohibited-merchants.html, including but not limited to cannabis and CBD (“Prohibited Products”). Merchant is prohibited from selling Prohibited Products without notifying Fivestars. If Merchant sells prohibited products, Fivestars is permitted to immediately terminate the Agreement and/or these Terms. For the purpose of monitoring Merchant’s compliance with this requirement, Fivestars has the right to review Merchant’s receipts at any time.
d.) Cooperation. Merchant agrees to (i) provide any information reasonably requested by Fivestars, Member Bank or Processor about Merchant’s business activities; (ii) permit the Card Networks, Member Bank, Processor or Fivestars to conduct on-site inspection of Merchant’s premises upon request and reasonable notice, and (iii) cooperate in any legal investigation or Fivestars, as may be required by Fivestars, Member Bank, Processor or any government or law enforcement agency. Merchant’s failure to cooperate with the requests of Fivestars, Member Bank, Processor, the Card Networks, or any government or law enforcement agency may result in an adverse action taken against Merchant, including but not limited to the assessment of chargebacks, fines, fees, or penalties.
e.) Minimum Transaction Amount. Merchant may set a minimum Transaction amount to accept a card that provides access to a credit account, under the following conditions: i) the minimum Transaction amount does not differentiate between card issuers; ii) the minimum Transaction amount does not differentiate between MasterCard, Visa, or any other acceptance brand; and iii) the minimum Transaction amount does not exceed ten dollars (or any higher amount established by the Federal Reserve System).
f.) Disputes with Consumers. Merchant agrees that all disputes between Merchant and any Consumer relating to any Transaction will be settled between Merchant and the Consumer and in accordance with the Rules. Fivestars shall not bear any responsibility for such disputes.
5. Settlement; Chargebacks.
a) Upon receipt of sales data for card Transactions (“Sales Drafts”), Processor will process Merchant’s Sales Drafts to facilitate the funds transfer between the various Card Networks and Merchant. After Processor or Member Bank receives credit for such Sales Drafts, subject to the terms set forth herein, Processor or Member Bank will fund Merchant, either directly to the Designated Account or through Fivestars to the Designated Account for such Transactions. Merchant agrees that the deposit of funds to the Designated Account shall discharge Fivestars, Processor, and Member Bank of any settlement obligation to Merchant, and that any dispute regarding the receipt or amount of settlement shall be between Fivestars and Merchant. Notwithstanding anything to the contrary in these Terms, Merchant acknowledges that Fivestars or Processor may retain and use Sales Draft transaction data during and after the term of these Terms without restriction and may share such data with third parties, including, but not limited to Member Bank and third party services providers. Merchant further acknowledges that Fivestars or Processor may aggregate the Sales Draft transaction data and that Fivestars or Processor (as applicable) shall be the sole owner of such aggregated data.
b) All Sales Drafts and deposits are subject to Fivestars and final checking by Fivestars, Processor, or Member Bank and may be adjusted for inaccuracies. Merchant acknowledges that all credits provided to it are provisional and subject to chargebacks and adjustments: (i) in accordance with the Rules; (ii) for any of your obligations to Fivestars, Processor, or Member Bank; and (iii) in any other situation constituting suspected fraud or a breach of these Terms, whether or not a Transaction is charged back by the card issuer.
c) You are fully liable for all Transactions returned for whatever reason, otherwise known as “chargebacks.” You will pay on demand the value of all chargebacks. You furthermore authorize Fivestars, Member Bank, and Processor to offset from incoming transactions and to debit the Designated Account, the Reserve Account or any other account held at Member Bank the amount of all chargebacks. You must fully cooperate in complying with the Rules regarding chargebacks.
6. Audits. Merchant authorizes Fivestars, Processor, and/or Member Bank to Fivestars its records, systems, processes, or procedures to confirm compliance with these Terms. When requested by Fivestars, Processor, or Member Bank, Merchant shall, at its own expense, obtain a financial audit of its business and submit a copy of such Fivestars to Fivestars, Processor, and Member Bank.
7. Additional Member Bank Agreement. The Rules may require that you enter into a direct contractual relationship with the Member Bank (“Member Bank Service Agreement”), the terms of which are available at https://hi.fivestars.com/worldpay-submerchant-agreement.html for Merchants boarded with Worldpay LLC, and https://hi.fivestars.com/firstdata-submerchant-agreement.html for Merchants boarded with First Data Merchant Services LLC. By agreeing to the terms of these Terms, you also agree to the terms of the Member Bank Services Agreement. As described in the Member Bank Services Agreement and in accordance with the Rules, the Member Bank Services Agreement is applicable to Transactions if Merchant processes or is anticipated to process greater than $1,000,000 in Visa transactions and/or $1,000,000 in MasterCard transactions in any 12-month period.
8. Merchant Reporting. Fivestars, Processor, and/or Member Bank are required to report to the IRS, on an annual basis, Merchant’s annual gross processing volume. Merchant is responsible for providing Fivestars with a matching taxpayer identification number and legal name on file with the IRS and shall be liable to Fivestars for any amounts incurred arising out of incorrect information or the failure to provide such information.
9. Indemnity. Merchant shall indemnify and defend (at its sole expense) any third party claims, suits, actions, demands, threats, allegations or other legal proceedings brought against Fivestars and each of its affiliates, and their respective directors, officers, employees, representatives, and agents arising out of (a) Merchant’s use of the Payment Processing Services, (b) Merchant’s breach of any of the representations and warrantees provided under these Terms. Merchant agrees to pay (i) any settlements entered into between Fivestars or Merchant and the third party claimant, or (ii) judgments awarded to the third party claimant by a court of competent jurisdiction. Fivestars shall (x) provide Merchant with prompt written notice of any claim, (y) subject to Fivestars’ right to approve or reject controlling counsel, grant Merchant control of the defense and settlement of the claim, and (z) provide reasonable information and assistance to Merchant in the defense or settlement of the claim at Merchant’s expense.
10. Term and Termination.
a) Termination for Convenience. Except as otherwise stated on an Order Form, Merchant may only terminate these Terms by giving written notice of an intention not to renew at least thirty (30) calendar days before the end of the current term of Merchant’s subscription to the Payment Processing Services stated on the applicable Order Form. Fivestars may terminate these Terms at any time, by giving Merchant thirty (30) days’ prior written notice.
b) For Cause. Fivestars may terminate these Terms and/or immediately cease providing the Payment Processing Services, without notice, if (i) Merchant fails to pay any amount to Fivestars when due or otherwise violates these Terms (ii) in Fivestars’ opinion, provision of Payment Processing Services to Merchant may be a violation of the Rules or any Laws, (iii) Fivestars believes that Merchant has violated or is likely to violate the Rules or the Laws, (iv) Fivestars, Processor or Member Bank determines Merchant poses a financial or regulatory risk to Fivestars, Processor, Merchant Bank or a Card Network, (v) Fivestars’ agreement with Processor or Member Bank terminates, (vi) any Card Network deregisters Fivestars, (vii) Member Bank ceases to be a member of the Card Networks or fails to have the required licenses, (viii) Member Bank is required to do so by any of the Card Networks; (ix) Merchant is the subject of any bankruptcy, or insolvency, or makes an assignment for the benefit of its creditors; or (x) the Merchant Agreement between Merchant and Fivestars is terminated.
c) Effect of Termination. If these Terms is terminated for any reason, Merchant’s obligations regarding any Transactions accepted for processing shall survive termination. In addition, upon termination, any amounts owed by Merchant to Fivestars, Processor or Member Bank shall become immediately due and payable. Merchant authorizes Fivestars, Processor or Member Bank to debit such amounts from the Designated Account or Reserve Account and, if the funds in each account are insufficient, Merchant agrees to immediately pay any remaining amounts owed together with all costs and expenses incurred to collect that amount, including attorneys’ fees.