Time is Money: Payment Process Service Set Up Smarts
If you’re a business owner, one of the first things you want to do is set up several ways to accept payments from customers. Many of them will expect to be able to use their credit or debit card. Are you ready for that? If not, here’s how to get ready.
Figure Out Which Type Of Business You Are
Depending on your business, you may need a static, cordless, or mobile terminal.
Static terminals: These types of terminals are typically fixed to the counter or a dedicated station, with a hardline running to your broadband modem or router. It’s not possible to move the terminal, and it’s designed for brick and mortar stores that attract customers and where the store processes transactions in a centralized location.
Cordless or wireless terminals: These are used in businesses where customers come into the store, but there is no central location where they pay, or where the payment terminal can be moved around the store.
Mobile terminals: These terminals are used by businesses that need ultra-portability, where payments are taken for goods and services in decentralized locations, like kiosks or vendor stations, or at events like trade shows or farmer’s markets.
Know What You’re Up Against
The application process can seem arduous for some. Dedicated merchant accounts are ones where you sign up for a merchant account and related services directly with a provider. Most providers perform an extensive underwriting of your business to determine the risk you present as a merchant.
The provider will want to know the type of business you operate, the industry you work in, the requested transaction volume, your financial information, and other information, depending on the provider.
If you run an online business, it’s usually harder to get set up than if you’re a retailer. This is because a retailer is less likely to disappear overnight, whereas there is less perceived stability with an online business.
Sometimes, the industry you work in can also dramatically affect whether you get a merchant account and the fees you pay for that account. The more risky the industry, the longer the process will take. For example, if you work in the mail order, gambling, or any business in which there are high return rates on merchandise or where there is a risk that customers will dispute charges, then it will take longer for the provider to approve your account, if they do at all.
Transaction volume refers to the amount of money you expect to process through your merchant account every month. Higher transaction volumes typically mean lower fees. Low volume means you’ll pay higher fees.
Getting A Simple Account As A “Starter”
If you get turned down for a merchant account, or if you don’t want to go through the hassle of setting up a direct or dedicated account, you can set up something through a third-party merchant services provider.
Third party providers act as a middleman between merchants and dedicated account providers. By accepting the risk for providers and merchants, they’re able to spread the risk of high-risk merchants out among other lower-risk merchants.
And, if you sign up for something like PayPal, PayPal virtual terminal fees aren’t seriously out of line from a traditional merchant account.
Usually, you will pay just 3.4pc plus a flat transaction fee. For higher volume of transactions per month, you can usually negotiate the rate lower. And, if you want to get started at a lower entry point, you can try Paypal’s affiliate company, Braintree.
Francesca Todd works in the technology sector of retailing solutions and has a sound understanding of merchant services and payment options. She likes to share her insights with an online audience and writes for several different B2B websites on a regular basis.