At present, debit and credit cards dominate the market and cash payments are virtually becoming a thing of the past. The reason for which so many small and large businesses alike have decided to accept electronic payment is represented by the fact that it is more profitable for them to be able to provide their clients with more payment options when it comes to purchasing from their stores. This fact is also supported by business magazines such as Forbes that emphasizes the fact that an estimated 66 percent of transactions are currently realized through the intermediary of an electronic payment system.
Obtaining the equipment
In order for a business to be capable of performing electronic payment processing and thus meeting the expectation of their clients, it is necessary to launch a merchant account that will provide the company with the indispensable payment processors. Webopedia defines merchant services as being the category of financial services that permit businesses to implement electronic transactions and also offers point of sales terminals. However, the merchant services consist of different types of terminals from which the customer is able to choose from.
Types of credit card processing:
- Traditional retail processor: these types of devices suppose the physical interaction between the customer and the merchant owing to the fact that the credit card is swiped between them. It is made up of a keypad, display and magnetic stripe. Basically the terminal allows the user to manually insert the credit card information and the data is passed on to the merchant service provider via phone or Internet connection for authorization. It is generally called a countertop terminal and they are preferred owing ot the fact that they are a lot cheaper
- Mobile terminals: this type of credit card reader is designed so as to be transported anywhere and functions based on a wireless connection. The terminal is ideal for those who are constantly on the road, such as taxi drivers, delivery persons and even waiters in restaurants to accept payments on the spot. As opposed to countertop devices, they run on batteries even though they have the same functionality, the only difference being that the transaction speed is significantly increased because of the high speed Internet connection.
- Point-of-sale terminals: the POS system can be defined as a type of equipment that combines the facilities offered by merchant services and software. They are available in stationary form or the POS system can be introduced on the phone or tablet. It is ideal for retailers that have a significant number of sales.
- Gateway terminals: these terminals allow the business to set up an online payment processing system. The company can economize important sums of money if it already benefits from an Internet connection. In addition to this, the software is automatically updated in order to run more efficiently. The only drawback is the fact that they do not allow swipe hardware. They also do not necessitate approval from the part of the merchant services.
Which credit card company to choose?
After it has been established that businesses cannot function without the help of credit card processors, it is necessary to know which company to select in order to get the most advantageous deal when it comes to purchasing credit card readers. U.S. Small Business Administration claims that the fess related to credit card processing have risen to 5%. There are many fees that a company usually perceives for the administration of the account. For instance, you get charged every time that you perform a transaction according to the size of the transaction and type. In addition to this, the actual implementation of the electronic payment processing system may end up costing you. Basically there are multiple hidden fees such as gateway access fee that you will be required to pay in order to use the equipment provided by the merchant, so it is advisable to discuss them from the very beginning with the providing companyReturn To Blog Listings