Small Business Credit Card Processing Help

Accountancy Resources

Small Business Credit Card Processing Help


In today’s world, using business credit card in business has been accepted. Yet, it is no far-fetch to know that many are yet to know how to use this and what benefit there is. This article focus on enlighten you to business card credit processing when it even comes to a small business.

Accepting credit cards is very important for any business. As said by the Small Business Administration, businesses that refuse to accept credit cards are missing out when it comes to increasing their sales. In fact, it stands that card payments are not only making the most common protocol of payment, rather, it provides the comfort of using credit cards and this affords customers to really make more purchases. Consumers now also expect that merchants accept credit cards and making cash-only business models a thing of the past.

Technology has done its best. Which means whether a business is just beginning or switching from a cash-only system, there are a wide variety of payment solutions available to merchants which ranges from merchant providers to online and mobile payment processors? Unlike before, it is easier now to accept credit card.

As mentioned in the outset, it is interesting to know that Business News Daily has created this guide to help your small business start accepting credit cards as quickly as possible.

Merchant Account Services

Accepting a credit card varies. But often times, accepting credit cards in business calls merchant account profit provider, a one-stop shop for businesses’ plastic payment needs. At the same time, a bank or other financial institution, will accept merchant services provider which gives businesses the services and tools they need to start accepting credit cards or debit cards.

How merchant account services work: like a mediator so does work Merchant account services. That is, between the business and the customer’s credit Card Company or bank. Processing the payment is also the duty of merchant account services and ensuring the money is normally withdrawn from a credit card account and placed into the business’s merchant account.

Who it’s for: Merchant services providers truly work for businesses of different types or varieties. Among these are brick-and-mortar, mobile and online businesses.

Merchant accounts: It is the merchant services provider that generally, provides merchant bank accounts which afford debit and credit card payments- although this does not suffice all the time. The accounts act as a holding location for the debit and credit card payments a business receives. The moment there is an approval to the funds, the merchant services provider therefore makes a transfer of the money, deduct its commission to the business owner’s bank account. Note that when you are opening a merchant account, make sure the merchant services provider offers the type of merchant account that is needed. This is very important because it will also enable you to be very well aware of the type of business that is being running. Below are the list showing the types of merchant accounts. They are:

  • Retail merchant account: This is mostly operated by businesses that operate in a storefront location, in which the customers’ debit and credit cards are physically swiped through the payment terminal.
  • Internet merchant account: This is an online business. It allows businesses to collect and process credit and debit card information from their e-commerce website.
  • MOTO (mail or telephone order) merchant account: These are types of accounts that are provided for businesses that operate by taking payments through the telephone and direct mail.

Couple with the payment, processing services and merchant accounts, merchant services providers offer a number of other tools for businesses — including the physical equipment needed to accept debit and credit cards, like in-store point-of-sale swipe terminals, and a number of fraud and security protocols.

  • Equipment: Merchant services providers offer businesses a variety of equipment needed to accept debit and credit cards, including point-of-sale terminals, simple swipers, PIN-pad terminals and wireless terminals. The majority of merchant services providers give businesses the option to rent or buy the equipment. Business owners can also purchase the equipment from a source other than the merchant services provider.
  • Cost: As merchant services providers cover all credit and debit card that are needed for a business, there is always a cost. Business owners should expect to pay numerous fees each month and per transaction for the ability to accept credit and debit card payments. And typically, average fees include:
  1. Monthly statement fee (on average, $10 a month)
  2. Monthly minimum fee (on average, $25 per month)
  3. Gateway monthly payment (it is often between $5 to $15 per month)
  4. Transaction fees (between 0.5 percent and 5 percent per processed transaction, plus 20 cents to 30 cents for each transaction made)

As it is seen that the rates can vary greatly among providers, it is important that business owners accepting credit and debit cards for the first time shop around to ensure the best deal.

Security: Merchant services providers should adhere strictly to the Payment Card Industry (PCI) Data Security Standard, the debit and credit card industry’s rules and regulations governing how credit card information should be handled, used and stored. This is the standards set for the framework in other to create prevention, detection and reaction to security incidents. Any business that do not comply with the PCI security standards face significant fines from the companies, such as Visa and MasterCard, whose cards they accept.

Pros and cons: There are some advantages attached to using a merchant services provider. One of these is to make a business’s credit card acceptance needs on its own.  They also provide necessary tools, such as merchant account management and fraud protection. As an all-in-one solution, however, the major disadvantage is its costs, which is one of the reasons why some businesses do not accept credit cards. For any businesses to survive as far as credit card is concern, there should be a thorough research and it should be ensured that they get the most cost-effective merchant account service provider that is best suited for their needs.

What to look for: There are many merchant services providers. Therefore when you decide to make your decision, there are some factors you should take into consideration as a business owner. This includes how difficult the provider makes it to be approved, the start-up and monthly costs, the equipment offered, and the provided customer-service options. For instance,  businesses that want to sell products or services from their website, it is important to make sure the merchant services provider has all the internet based features, such as virtual terminals and payment gateways, that will be needed.

Mobile Credit Card Processing

If you fall into any of these: Is your business always on the go? Do you accept payments on the field or at trade shows and other events? Or would you simply like to be able to accept payments from anywhere in your store? – all you need is Mobile Credit Card Processor. This will provide businesses with the tools they need to turn their iPhones, iPads and other smartphones and tablets into payment terminals, allowing them to take payments anywhere there is a mobile service.

Who it’s for: Mobile credit card processors are mostly suited for merchants who want to be able accept credit cards anytime, anyplace. Some examples are repairmen, food trucks and street vendors, as well as brick-and-mortar stores that want the option of accepting credit and debit cards away from the cash register.

Merchant account: Just like merchant services providers, mobile credit card processor like merchant services provider have their customers set up a merchant account to receive credit and debit card payments. What makes the difference is that these accounts can receive and process payments wirelessly.

Equipment: Just as retail stores need their own equipment to swipe credit cards, so do mobile businesses. To accept credit cards via mobile devices. A compatible smartphone or tablet would be needed. For instance, typically iOS or Android is needed. Also, there would be a card reader that plugs directly into the device, and the accompanying app from the provider. The smartphone or tablet then becomes a credit card payment terminal, complete with a swiper and other tools as a regular register.

Cost: The features of Mobile credit card processors is similar to regular merchant services providers. Costs include:

  1. Monthly statement (varies)
  2. Monthly statement fees (varies)
  3. Monthly minimum fees (varies)
  4. Transaction fees (ranging from 0.38 percent to 3 percent plus 10 cents to 30 cents per transaction)

Security: Any websites that uses Secure Sockets Layer is the best mobile credit processor and they have encryption keys. In addition, the individual apps the business owner uses to accept the debit and credit cards often are password-protected and include additional safety measures, should the mobile device be lost or stolen.

All in all, as explicitly discussed in this article, it is ensure that any small business can succeed with any the process of credit card usage.