Accepting Credit Card Payments for Small Business: How To Get Started

Cash is quickly taking a backseat to more convenient payment forms like credit or debit cards and mobile payments through phone apps. Recent surveys have found that millennials are the consumers most likely to abandon cash purchases, but the rest of the nation doesn’t rely on cash transactions as much as they used to, either. Non-cash payments account for close to 75% of all transactions across the nation. This isn’t good news for your business if you are a cash-only establishment. It’s time you look into accepting credit card payments for small business purchases.

Getting Started Accepting Credit Card Payments for Small Business Transactions

There is increased security with debit and credit card transactions for both the customer and the small business owner. Accepting electronic payments provides an increase in growth opportunities, as sales can take place online or over the phone with a credit card payment. There are many credit card processing options on the market, so this guide can help you understand what is available and what is best for your business.

Determine Which Credit Cards To Accept

Though many payment processing centers will have similar features and functions, not all of them will accept the same credit cards. The major card issuers are Mastercard, Visa, American Express and Discover. Many financial institutions have partnered with one of these leading services to issue debit cards, further making some cards more popular than others. Depending on how you plan to accept card transactions (phone, online or in person) will guide you to the best option.

American Express is a favorite among cardholders, but it’s one of the cards many retailers will refuse to take. This is due to the higher processing fees from the American Express institution, which can eat away at a company’s bottom line. When you are accepting credit payments for small business purchases, you may want to avoid this higher-cost service in favor of the other three leading lenders.

Review the Processing Fees

There are typically several parties involved in a credit card transaction. These include your company, your bank, the credit card company, the credit card issuing bank, the consumer making the purchase and the processing company for the credit card. Everyone has a part to play, and apart from the consumer, everyone gets a piece of the transaction. This is usually from transaction or merchant fees. You can expect to see some or all of the following once you start accepting credit card payments for small business transactions:

• Account maintenance fee
• Annual fee
• ACH/daily batch fee
• Authorization fee
• Minimum monthly fee
• Transaction fee
• Wireless service fee

Some other fees that aren’t as common include an early termination fee, debit network fee, statement fee or cancellation fee. How often you process payments will contribute to how these fees impact your bottom line. Some providers have better rates for businesses that process a higher volume of transactions. Although you won’t be able to avoid paying fees altogether, you can find a processing company that has the cheapest or fewest fees. PaymentClub has a competitive processing system that minimizes extra costs from excessive fees.

Consider the Payment Processing Hardware

When looking at a payment processing provider, you have to consider what type of hardware is required to start accepting payments. If your business functions primarily as an e-commerce venture, you want to find a processor that simply and reliably integrates with your online platform or website. If you have a brick-and-mortar site where consumers shop or call to make a purchase, you might be required to have a specific payment terminal that is compatible with your point of sale system.

Credit card terminals have been around for a while and are generally the most familiar ways to accept payments in a retail setting. In recent years, these systems have gotten upgraded to ensure the security of transactions, such as embedded chip card technology. Many of the newer terminals are also able to accept mobile wallets like Google Pay or Apple and other contactless payments. With the right terminal, you can expand your options for accepting credit card payments for small business purchases, providing additional convenience to your consumers and value-added services for your business.

When you can fully integrate your POS system into your processing service, you could enjoy added benefits like payroll management, end-of-day reconciliation or loyalty program tracking. A high-end POS system will help both the front end and back office run more efficiently, and it also gives the consumer faster checkout times and less hassle with payment options through mobile acceptance solution add-ons. POS systems are user-friendly, but they can cost more than a standalone processing terminal. Depending on your budget, you may need to start out with a basic processing device and move up as your business grows.

Establish Credit Card Processing Safety Expectations

There are credit card processing laws to understand before you start accepting credit cards. Credit card compliance is a big deal, but the right processor will help keep you on track. There is mandatory reporting to the IRS for sales conducted using a debit or credit card, as well as expectations of consumer privacy and security from data theft.

The Payments Card Industry Data Security Standards are the rules that safeguard data when payments are made online. These guidelines are used across industries and designed to prevent fraud. Maintaining compliance with these guidelines depends significantly on your choice of a credit card processor. There are four different levels of compliance, and your total amount of payment processing each year influences where you fall in those guidelines The Payment Application Data Security Standards mandates that all POS terminals or equipment must meet the minimum standards established by the PCI.

Using PaymentClub for Accepting Credit Card Payments for Small Business Transactions

For an option in accepting credit card payments for small business purchases that has low fees, a merchant mindset and superior convenience, choose PaymentClub. With our years of industry experience and transparent processing solutions, you won’t find a better partner in credit card processing.