Accepting credit and debit transactions: a guide for small business

All small businesses need to be able to accept credit cards as a means of payment from their customers. Any small business that doesn’t have the facilities to do this is missing an obvious opportunity to maximise their sales potential.

Not only are debit and credit card transactions becoming the most popular means of paying for goods and services, their convenience and ease of use mean that customers are more likely to make purchases. This is particularly true online where using cash is not an option, so in order to grow your business online it is essential to have a facility to allow credit and debit card transactions.

Set up a merchant account

Firstly you need to decide which cards you want to accept. You may want to accept all major credit and debit cards as well as gift cards, stored value cards and smart cards. To do this you will first need to set up a merchant account. This is usually done through your bank. When making the application your bank will look at the credit rating of your business and take into account how long you have been in business. You might also need to show a business plan to include the volume of sales you expect to get through credit and debit card transactions as well as the average amount of each sale.

Obtain processing equipment

The equipment you need for credit and debit card processing can either be bought or leased and is usually obtained through your bank or financial organisation. The equipment itself depending on your processing methods can consist of a card reader attached to a modem. Using state-of-the-art technology such as that provided by Payzone cards  will give verification instantly on whether or not the card has been approved or declined.

If your business is run online only and you don’t have an actual shop where customers can come to, you can use an online payment processor and set up an account. You will need to enter your business information, verify a bank account where money will be transferred and enter your own credit card information when accepting larger sales.

Fees

With credit card processing accounts many will charge a percentage amount of the sale to the retailer for processing the credit card transaction. There are also monthly minimum charges, statement fees and fees for processing charge-backs. It is important to look into the agreement at the beginning and be aware that there may be changes to that agreement along the way.

November 21, 2015 | Category: Business | Tag: