Yeah, check with the lawyer. Because some of what is said below is
wrong in the US, a corporation (much less a business registration) by
no means provides iron-clad protection of your personal assets.
You've got a small business. Merchant accounts are very good
candidates for abuse. The issuer is usually just a marketeer acting
as a front end for the processor. They're at risk for your behavior
and that's why you'll find lots of different policies for fees,
crediting you with proceeds of transactions, and checking your bona
fide's. I'm not at all surprised that they want you to guarantee your
small company (which is worth nothing to them), I'm more surprised
that they aren't asking for your bank account numbers and lots of
additional personal data to make it clear (to you) that you won't be
able to process a bunch of fraudulent transactions, collect the
proceeds, and then vanish into the night.
Tom
On Aug 5, 2010, at 12:11 PM, Rafael Bugajewski wrote:
> Hi Gautam,
>
> the best thing to do in your case is to contact a lawyer. Such
> clauses can have different meanings and effects in different
> countries.
>
> In a lot of countries it also depends on the type of business you
> have registered. Even if they have such a clause, but you
> registered a business where you take no personal liability, they
> cannot demand the money / assets.
>
> Once again: the best thing you should do in this situation is to
> contact your lawyer. Even if you have a relatively new company with
> much less income it is worth to have a lawyer who can give you advice.
>
> Best,
>
> Rafael
> *currently free for a dev job*
>
>
> On 05.08.2010, at 20:46, Gautam Godse <[email protected]> wrote:
>
>> hi all,
>>
>> I am trying to setup a merchant account for online CC transactions
>> for my new startup (www.gingercube.com). The product will be a
>> monthly subscription based service.
>>
>> We are a new company with less than couple of months of existence
>> and financial history.
>>
>> So when we applied for a merchant account with ChasePaymentech
>> (using Spreedly.com as our front end biller) their application
>> form has a Personal Guaranty clause that essential states that if
>> the corp (gingerCube Inc) goes under, then the merchant can come
>> after our personal assets for any outstanding payments that they
>> are owed.
>>
>> Is this a standard clause ? Do most merchants require this ?
>>
>> And is there a better alternative for what we are trying to achieve ?
>>
>> Thanks for your help!
>> ---
>> Gautam Godse
>> MacMessiah.com
>>
>>
>>
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>
>
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