Recurring problems with Google Checkout

An important feature in Google Checkout has now been unavailable for almost a month, and some merchants are getting fed up with Google's automated approach to their concerns.

Google's ability to handle recurring payments, such as monthly subscriptions to a service that are automatically billed once a month, has been impaired since around the middle of August with little notice by the outside world. A customer first reported the issue in a Google Checkout forum in August, and others, such as Katie Braband, sales director at storage company Datto, are still unable to rely on Google to process anything other than one-time payments.

Braband went into Datto's offices on September 2 to a nightmare for any small business owner: the monthly revenue from subscriptions to Datto's off-site data backup services did not arrive as scheduled in its Google Checkout merchant account. Making matters worse, there was no way to contact a live human being at Google directly; Datto was directed to an online forum and support page where they received this response: "Our engineering team is working to resolve this as quickly as possible, though I'm not able to provide a specific timeline at the moment."

Google confirmed there are still problems with Google Checkout on Wednesday but provided no time frame for a fix. "We're currently looking into some service disruptions to Google-handled recurring payments. Merchant-handled recurring payments are functioning normally," the company said in a statement. Merchant-handled payments are when the merchant submits a request for payment on the day of the recurring period, a burden that services such as recurring payments processing are designed to avoid.

Google Checkout has been around since 2006. Designed in part as a competitor to PayPal and Bill Me Later--the far-more common online payment processors--Google Checkout offer Internet merchants the ability to accept payments online without having to invest time and money into building and maintaining their own payment processing system, in exchange for a cut of each transaction.

That's a familiar strategy at Google, which offers budding application developers hosting resources at Google App Engine and other businesses the ability to bypass more expensive office productivity software with Google Apps. But while Google is quick to respond when problems knock services like Gmail or Google App Engine offline, the delay in responding to problems with Google Checkout has cost it at least one customer.

Datto's problems with Google began when Google surprisingly placed a 15 percent reserve on its account following a review of Datto's finances, which the company insists were in order and evidence of a healthy balance sheet. Payment processors will often hold a portion of all money slated to wind up with the merchant in cases where merchants have a higher-than-normal number of chargebacks or appear to be going through a rough patch as a hedge.

For several days, Datto was unable to reach anyone at Google to confirm that its financial statements had been received as part of that review, which made the company worried because the request for its finances came with a warning that all payments would be stopped if Google didn't receive a response within five business days. Google doesn't offer phone support for Google Checkout; instead it maintains a Web site called the Merchant Help Center for customers to get support and lodge complaints.

Confirmation eventually arrived with the reassurance that the account was working properly and everything was in order, but six days later Google told Datto that it would be holding 15 percent of all payments processed through Google Checkout "based on a recent review of your business," and with no further explanation. At this point, Datto decided to build its own payment processing system and move off Google Checkout.

However, before the new system could be completed the company discovered the issues with recurring payments. "We received no notification whatsoever that the recurring payment system was broken and now we have no guidance as to when it will be fixed," Braband wrote in an e-mail. "In addition to having 15 percent of all Google Checkout disbursements held in a reserve account (completely inaccessible to us) for 90-180 days, we now have no way of collecting our monthly recurring payments."

Google declined to comment on the specific circumstances involving Datto, saying that it does not comment on individual accounts.

In an interview, Braband said Datto was lucky that it had already made so much progress toward developing its own payment processing system but the outage caused problems with customers who thought their data was not being backed up when the payments went awry, and has forced them to re-evaluate their impression of Google in general.

"As a young technology company we always admired Google. Their many free tools and applications are amazing and the support that comes with them is great too. It's disappointing to all of us at Datto Inc. that these fixable occurrences regarding Google's payment processing has tainted our admiration of the people who changed the web, and that Google has chosen to provide no support to the many businesses paying to use Google Checkout," Braband wrote in an e-mail.

And that could be a real problem for Google as it attempts to build paid services around products like Google Apps. Even small businesses are accustomed to developing relationships with their suppliers that can help smooth over the inevitable problems that occur in any business relationship.

Nieman Journalism Lab reported Wednesday that Google has offered its services with micropayments as a possible solution to the woes of the newspaper industry, allowing them to charge news consumers small amounts for individual stories or recurring subscriptions through Google Checkout. Before that happens, some serious problems with Google Checkout and customer support will need to be addressed.

[Jack K1]

One word: PayPal.

[zelrik]

I know 2 people who had a paypal account :
- 2000 Euro stolen
- 2000 Euro stolen

I got charged myself for 20 dollars and I never got it back. I contacted paypal, they told me they would check, then they came back to me and said the transaction was legitimate....so no more paypal thanks.

[PhaseDMA]

While I've had issues with paypal and questionable products/services everything has always worked out.

[Police_States_of_America]

no thanks

[cnetRajja]

Hi Friends,
My idea "Virtual World" is selected.
Please vote for it to make it real!
http://googleproject10tothe100th.blogspot.com/2008/10/google-project-10100-idea-virtual-world.html

Thank you.. :)

[pizzapanther]

I've had the same problems with (paid for) GMail. Google support sucks! Thankfully you don't need it that often.

[alenas]

What about problems with Google Calendar. It is "half" working for a week (if not more) now. Many people are getting service is not available message.

[Stormspace]

My experience is that it's more expensive to use it. Also, in the few cases I tried it I was unable to get the free shipping deal offered by the vendor once I chose Google checkout.

[joetesta70]

Google is a one trick pony. Search. Soon they'll realize they have a LOT of people working there with 4.0's in college who do nothing for the bottom line.

I'm not convinced they can enter and dominate new markets the way Microsoft can or that businesses can depend on them for mission-critical apps.

[pentest]

Yeah, because the morons with 2.5's working at Microsoft do better. Ha!

Both MS and Google are third rate companies.

[YankeePoodle]

pentest,

People who work at Google or Microsoft are definitely 10 times smarter than you. Given that you are half as smart as an average person. talking of third rate companies, which first rate company have you established or work for?

[FutureGuy]

As a Adword user I find google has the absolute worse customer support, its like they are doing us a favor.

[usarioclave1]

We use google checkout, and it's reporting is the worst of any payment service bar none...and it's been that way since the beginning. Not sure what all those checkout guys are doing.

[Seaspray0]

Since the businesses are having a portion of their payment withheld, they are in essense "paying google" for a service that isn't working. The companies could do a class action lawsuit.

Tom, you have uncovered a big achillies heel for google... no direct support.

[krosafcheg]

Google checkout team and executives etc, if you are reading this you're really missing the boat here on providing an alternative to Paypal. I mean, from 2006 until now you haven't figured this out!? Really!? A revenue stream and you neglect it and drop the ball on something as simple as recurring payments? No support for (phone, etc) businesses PAYING you to use your service? For all the things that you guys do - this is a no-brainer. Oh and while you're at it - a new alternative to eBay would be great , they really jumped the shark now. Have you seen that place? (ad banners, can't find anything, clunky...)

Captain Obvious

[shootfirst]

Yep Google isn't for people that need hands held to do things. People who think M$ is any better are just paying out more money, you never get free tech support from M$. The amount you pay Google do you really expect first rate service?

Payment systems should be checked on all features. If you don't check recurring payments to see if they are stable it is your own fault.

I know a guy that refused to use Google just because he couldn't get them on the phone, however the smaller Mom and Pop service he was using he could get on the phone, but they would always say it wasn't their fault and just give him the run around. Smaller businesses should have better support since usually they lack on everything else.

Google's not perfect, but they give you an option and while it may not be the correct one just be thankful because companies like M$ need the competition.

[GajaKannan]

"shootfirst" seems to be right for your comment. M$ is not even in payment business. May be you should compare paypal or billme later if you want to send your point across. Sounds like you just want to bash M$ and drool over G00gle

[rapier1]

Really? So your position is that if you pay for a service and it doesn't work as advertised its your fault for actually expecting the service to, ya know, work? What an intriguing point of view!

[dowell100]

No one should minimize this. Google is abusing the public in lots of ways, from their usurping book copyright laws to things like offering a service that Google Checkout that does not function as advertised.

Google picks up lots of lawsuits because of their cavalier attitude towards clients. They could care less if they make small companies go broke by failing to maintain their reoccurring payment system or by adding totally unnecessary 90-180 day embargoes on funds.

Google is not too big to fail. It is time there was a public boycottt of Google and a government investigation of their underhanded dealings in many areas.

[pentest]

Anyone who relies on Google(or MS) get what they deserve.

[Police_States_of_America]

yet another promising google product that needs basic and proper functionality... yawn

[sharmajunior]

AMAZING!!! Google engineers are getting lazy.....what about innovation then?

[bedekiwi]

We have struggled with Google Checkout from day one. The biggest issue we have is realtime shipping rates coming from UPS and USPS. Google gives around 3 seconds for a response to come back from the shipper servers. If there is a slow response Google just times out and makes all the shipping $0.!!! There response ( via email ) is that's just the way that it is.

We have often wanted to pull the plug on Google Checkout ( and we no most of our peers have ) but know that the Google Checkout logo highlights our Google paid listing. If we drop Google Checkout we loose the logo. Damned if we do and damned if we don't. Happy, NO.

[paulalabra]

Right now, I am totally hating GOOGLE. I have been a Google fan up until yesterday!
I subscribed to Google Checkout, being that I live in Chile and wanted to order some stuff online, so I thought it would be easier. WRONG IDEA!
I've made about $500 worth of shopping and now my orders don't come up in the stores where I did the purchase and there is no way to contact anyone from google checkout. Seems like I should have done some more searching instead of just trusting Google. Now, I have all those things charged on my credit card, and have sent emails to everyone there is to send emails, but still haven't gotten a reply.
What the hell should I do?!
I am totally disappointed with Google and really regret giving them all my credit info.
Hopefully someone can help.
Thanks!

[paulalabra]

Oh! And I forgot to mention, how quick they were to charge everything on my credit card and HOW SLOW they have been to respond.

[t8]

I have been waiting for Google Checkout to become available in my country.
But after reading this story, I think PayPal sounds like a better option for my web sites.

[Harrison912]

I used Google Checkout for a while for my safety and security web site but found out through their automated system when it emailed me that I could no long carry stun guns and hidden cameras if I wanted to use Google Checkout. I decided to keep my products and lose Google Checkout. I just don't understand why these non-lethal products should be banned. If Visa, MasterCard and Discover don't mind, why should Google Checkout? Thanks, Tom.

[georgebaily]

Mmmh welcome to the world of Paypal, google. But I couldn't think of anyone better able to handle it. Otoh, let's see how Alipay fares, lol

[danyelb]

Even paypal respond to your email almost instantly and they have a real person to talk with on the phone.