Accepting Payments Through Mobile Phones or Tablets

by Sudarsan

Small businesses all over the US is seeing increasing demand for mobile payment options. Whether you run a busy indoor and outdoor restaurant, high-end clothing boutique, or pop-up flower shop at the farmers market, you can benefit from these hand-held operating systems immensely. The challenge is deciding which service to choose, for the best convenience and pricing. Basically, your options fall into 2 categories: traditional payment processing, or a standalone mobile processing company. Each has their pros and cons.

Traditional Payment Processing with a Mobile App and Device

If you are going to accept credit cards traditionally by swiping a card or inserting a chip card, and/or online payments, you will end up choosing a traditional payment processor and gateway. There are hundreds of merchant account processors, it’s a competitive industry. You should shop around based on their pricing, looking out for hidden fees. Most but not all providers will have mobile options for your business, so be sure to check before you sign up. They would provide you with a mobile app, as well as a device they will send you to plug into your phone or tablet. The devices utilized by each provider will vary. For example, Double Helix, which specializes in high-risk merchant accounts, use Magtek mobile readers and have 4 to choose from.  Some may charge you for the device, others will include it as part of the service.  It’s important to understand upfront if your business can work with a smaller dongle plugged into your phone, or will need a standalone device that is more expensive.

The fee structure is notoriously complicated for traditional merchant accounts.
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You will need to price a few companies and find one whose fee structure fits your business model.  You can expect the traditional merchant account is the better option for higher volume businesses. The total fees and rates are usually lower at higher volumes. But more importantly, the ‘extra’ or hidden fees that are atrocious for one business, maybe not even apply to your business. Also, you have the opportunity to negotiate a better deal based on your volume and needs.

3rd Party Mobile Processors

Also known as payment aggregators, there are providers that only offer mobile processing, or perhaps online plus mobile. Paypal would be an example of this, as you can take online payments, and they also offer a mobile program with a tiny dongle called Paypal Here.  But they are not your traditional payment processor by any means, you’d be using a virtual terminal at most. If you only need mobile processing and have a small business, it’s worth it to explore some of these standalone options.  In some cases, they will cost more but will be a simpler option. In small volumes, they will probably cost about the same. Here are some options in addition to Paypal as mentioned.

  • Square: Probably the most popular aggregator for mobile. With no monthly fees, no contracts, and no merchant accounts Square is rising in popularity. This is great for special occasions, but unfortunately not big business-friendly because you pay a 2.75% transaction fee for EVERY transaction.
  • ROAMpay: One of the highest-rated choices for active business, ROAMpay offers a low transaction fee of 1.58% per sale with no mandatory contractual obligations. The card reader attachment for phone or tablet is free, with a monthly entry fee of $7.95, and is compatible with all major credit card companies and most smart devices.
  • LevelUp: This app does not require the customer to have a credit card or smartphone. Perfect if your intended audience may be frightened by modern technological advances. Merchants use this app terminal, which integrates a Quick Response (QR) code to provide payment options. There are other benefits to using this application, such as customer loyalty rewards programs and commercial marketing campaigns in place of transaction fees.
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  • GoPayment: Costs $12.95 a month, including the machinery used to swipe. This may seem steep comparatively, but the transaction fee is 1.75% of TOTAL sales. This app is compatible with iOS and Android devices, automatically syncs with sibling accounting software QuickBooks or Intuit Payment, and updates and balances your books at an instance.
  • PayToo: This app is global, working with all major credit cards, debit cards, e-checks and even accepting coupons to allow merchants to accept payments and include customers from all around the world. It is not required for a customer to have a bank account. This payment service displays its inclusion principles by offering international direct deposit services for staff and free money transfers between multiplePayToo users.
  • Boku: Virtually anyone can access this mode of payment, as long as they have a mobile phone number. This payment option can easily be featured on any official website or app, businesses only need to apply for an account online. Once a customer enters their mobile number the payment is added directly to their phone bill, releasing the need for a middle man.

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