Small businesses are spoiled by choice of online payment processing technologies in 2017. With so many options to choose from, selecting payment processing methods can be overwhelming for harried business owners. Learn the difference between popular credit card processing options including PayPal, Square, Apple Pay, and Google Wallet, to offer payment processing with confidence.
Best Payment Processing Tools for 2017
Small businesses need a card processor to take credit card payments in retail stores, pop-up shops, and markets or events. The best payment processing options are simple to use, reliable, and come with no hidden fees:
- PayPal – PayPal has the advantage of time-tested technology for online payment processing. It integrates with ecommerce solutions and accepts payment in global currencies and even Bitcoin. With a PayPal Reader, you can take payments from a tablet or smartphone starting at 2.7 percent for card swipes.
- Square – Square is a great card processor for taking payments outside your place of business. If you attend events, hold a fundraiser off-premises, or do holiday markets, Square makes it easy to process credit card payments. There are no monthly fees to use the card reader; pay 2.75 percent for card swipes or 3.15 percent plus $0.15 for manual card entry. You can keep the money in a Square account or request payment to your business checking.
- 2Checkout – 2Checkout offers an elegant solution to global payments, making it easy to accept payments in any currency. With multiple language options and a mobile and web interface, it’s an elegant solution no matter where or how you do business. 2Checkout accept payments on your behalf via Pay Pal or credit card, then sends the funds to your business account via check or wire transfer. Fees for basic transactions are $0.30 plus 2.9 percent of the total; expect to pay more for currency conversion and international sales.
- Apple Pay – Ideal for retailers, this allows you to accept payments via iPhone or Apple Watch. Shoppers simply tap their Apple device to a reader to automatically pay with a credit card that’s been saved to their device. An integrated Touch ID makes it secure for shoppers and painless for merchants. Shoppers can also use Apple Pay online, when buying from a new MacBook Pro.
- Android Pay – Like Apple Pay, Android Pay is a “digital wallet” that lets shoppers pay with credit cards directly from an Android device. It’s a more secure version of the older Google Wallet. You’ll need a special card reader to accommodate Android Pay users.
Many retailers find the best solution is to offer several ways to pay. Investing in Android Pay won’t accommodate Apple device users and vice versa, and neither technology will help you accept payments offsite. Spreading your credit card processing technologies wide ensures you’ll never need to turn down a payment.
How to get a Merchant Account
No matter which of these technologies you decide to implement, you may need a merchant account to accept credit card payments. You may be required to open a merchant account if you sell pricey items, do a lot of business, or work in an industry that has a lot of disputed transactions. A merchant account basically safeguards the credit card processor from any liability while guaranteeing your business is credit worthy. If you’re wondering how to get a merchant account, keep reading.
The funds in a merchant account are used to satisfy transaction disputes and protect the financial institution from being liable for fraudulent charges. Depending on the institution’s policy, the reserve you must provide can be capped, rolling, or fixed up-front. You can provide the funds or show a letter of credit from your business lender.
While these accounts may sound complicated to set up, they’re not. Complete the merchant account application and provide the requested documents plus any up-front reserves required. Once the lender approves your account, you are good to go!
As long as you follow all the steps, provide the information required to open your merchant account and invest in the right card processing technologies for your small business, you’ll be able to keep pace with the changing face of shopping.