Squeezed by freeze on funds

Business owner down but not out

AFTER falling on hard times, owner of Elevate Kombucha Andrew Phelan took the uncomfortable step of baring his problems to the world, and reaching out to his customer base for help.

With his rent in arrears, sales dwindling, and he and his partner facing potential eviction from their home, Mr Phelan took to Facebook with a plea.

“The harsh reality is that our business has been struggling,” Mr Phelan wrote, adding that keeping their financial lifeline afloat had taken priority over other expenses.

The reaction was immediate; sales and offers of places to live came flooding in from across the country. But his joy quickly turned to despair.

Square, the payment company he uses, deemed a minor proportion of sales – those of Tarot card readings and “air hugs” – as having a “high-risk” of customers seeking refunds, and froze $1200 of transactions for 90 days.

He said he pleaded his case with the company to no avail.

Now, in addition to having to pay off their rent, bills, and stump up bond for a potential new home, Mr Phelan also has to honour $1200 of sales – without being paid for three months.

He said while he had been “overwhelmed with gratitude for his customers”, he was speaking out because he “would hate to think this would happen to anyone else”.

The business is now using a new payment service through their website elevatekombucha.ecwid.com.

A Square spokeswoman said she could not comment on Mr Phelan’s case due to privacy reasons. She added that freezing funds was a “rare” but “important tool in making sure we protect everyone involved in the transaction from a potential dispute, not just the seller.”