How does Square respond to declined payments?

[AMEU]

We are a 501c3 non-profit, based in New York. About a year ago, we became sufficiently disenchanted with PayPal's politics that we moved over to Square, with expectations that our loyal supporters would follow. 

In the succeeding 12 months, our supporters attempted to migrate over to Square. However, donations plummeted, but did not disappear completely. At year end, I looked into the matter more closely, and was shocked to discover HUNDREDS of unique attempted transactions (i.e. charitable donations) that had been declined.  By a very rough estimate, we probably lost tens of thousands of dollars of support; for an outfit our size, this lost support could well be fatal.

When I contacted Square's customer service, two things were said. First, Square's troubleshooters suggested that the problem was on the API side, i.e. implying that my website was preventing payments from reaching me,  and that Square was not preventing payments from making it through to my organization.   I thought this was odd, given that some payments did get through, and that the payments we'd always been receiving through PayPal, continued to successfully transmit. When payments succeeded, i.e. with both Square and Paypal, I received regular notifications by email. However, and very problematically, I received no notifications of the declined payments, which only occurred on the Square side.

That was the second, and much larger red flag: Square informed me that I had received no notifications of the declined payments because "the setting had been turned off". This made little sense since we were a new customer, and used the default settings from the outset and never changed them. Presumably, Square's default settings would have been set to provide customers those very basic protections. In our case, with a tiny percentage of payments making it through, and the vast majority being declined, we absolutely needed the notifications.  Making matters worse, Square was unable to provide any logged information about the declined payments; not a single email address was available. 

The last message I got from Square would be funny if it weren't true:

"Hi Nicholas,
I do apologize but unfortunately there are no next steps.
Kind Regards,
Griffin
Square Management"

HELP?!?!

[drraddc]

This seems really awful. Maybe Square shouldn't be marketing itself to 501c3s?

[AMEU]

I'm still hopeful someone there will explain the matter better than Griffin/Square Mgmt" did! 

[RobynR · Accepted solution]

Hey @AMEU, Thank you for sharing your experience.

We sincerely apologize for the confusion earlier regarding notifications for declined payments. To clarify, Square does not send notifications for declined transactions—notifications are only sent for completed transactions, which you can review in your Square Dashboard under the Transactions section or view declined transactions under your Transaction Status report.

Why Payments Might Be Declined

Declined transactions can occur for various reasons, including:

• Insufficient funds or restrictions by the cardholder's bank.
• Incorrect card information entered during the donation process.
• Card-issuing bank restrictions or payment limits for certain transaction types.
• API or website integration issues affecting how payments are processed.

Next Steps to Address the Issue

1. Double-Check Your API or Integration

   • If your donations are processed through a website using Square's API, ensure that your payment gateway is configured correctly. Incorrect configurations could cause failed transactions.

2. Test Transactions

   • Conduct a test transaction to ensure your payment flow is functioning correctly.

While Square doesn’t currently provide donor details for declined payments, we recommend submitting this as a feature request. Enhancing declined transaction visibility could be beneficial for many organizations, and seller feedback helps prioritize future updates.

We truly regret the inconvenience this has caused and appreciate your patience as you work through these challenges. Let us know if you need any additional guidance.