This is an explanation of why we have been unable to take card machine payments since June 2022. It is also a warning to card machine users.

In 2015 we signed up for a card machine with a company recommended by the Federation of Small Businesses. In June this year I noticed a payment that a customer had made for £770 had not gone into our bank account.

I checked back through all the transactions (which took many hours) and found a number of other payments were also missing, so I did a full audit for the previous two years and found that 31 transactions totalling £3500 had not arrived in our bank account. The card machine had issued a valid receipt for the transaction in every case.

A card machine sends the information about the transaction to a receiving bank, which then passes the money to (in our case) the Alliance & Leicester, and they send it to our bank account at Lloyds. The missing £3500 had not come out of the accounts of the people who had paid us, so where was it?

We contacted the card machine company and the receiving bank, and have spent hours on the phone since July. The receiving bank had some of the money but had not paid it to us for reasons they did not explain, so we recovered some of it after emailing the customers concerned to let them know the money would be coming out of their accounts weeks after the transaction.

We are, however, still owed over £1100. The card machine company blames the receiving bank, and the receiving bank blames the card machine company. We have repeatedly asked both of them for an explanation of how this situation has arisen but have never had an explanation. Both of them have rejected our complaints, claiming that we have not sent them documentation which we have sent repeatedly.

We do not believe that we can be the only business that this has happened to. We pay a substantial amount of money for this service: the customer should not have to check that the supplier is doing the job properly. In any case, if you are operating a retail outlet that has dozens of transactions a day it would be almost impossible to check that every one of those was processed correctly.

So what do we do now? We can’t use the machine because we can’t trust it, so we have stopped paying for it and are now being threatened with court action. What we can do in response Is:

Publicise the situation. This email is the first shot. ‘Guardian Money’, the BBC’s ‘Money Programme’, and many others might be interested. Is our experience the tip of an iceberg?
Go to the Financial Ombudsman.
Complain to the Federation of Small Businesses about our treatment by one of their recommended suppliers.
Get legal advice.

The irony is that both the card machine company and the receiving bank operate from the same building in an English town. We don’t care which one is at fault, but all they need to do is to cross the corridor, have a meeting, and sort the problem out.