As a business owner, it is important to accept credit and debit card payments. When you limit your payment options, you potentially miss out on sales opportunities. Providing your customers with a variety of payment methods entices them to buy your products or services.
Businesses have several options for accepting credit card payments. You could have a POS system that is connected to your payment gateway and payment processor. You might have a stand-alone machine that processes credit and debit transactions. You may have a mobile payment solution using a mobile device, such as a smartphone or tablet.
Regardless of what setup you have, one thing the global pandemic has taught us is that customers want the flexibility of mobile solutions and contactless payment options.
How Do Businesses Accept Mobile Credit Card Payments?
There are a few different options available for businesses to accept mobile credit card transactions and payments as follows:
In-Store Contactless Payments
With this payment option, your credit card terminal is updated to accept mobile payments. Instead of using a physical card to pay, the customer opens the wallet on the mobile device and places their phone above the credit card terminal.
The phone securely transmits the card data to the card terminal. The card terminal then transmits the card data and payment amount to your merchant services provider for processing and approval.
iOS or Android Mobile Device Mobile Payment Processing
With this type of mobile payment processing, the business owner uses their iOS or Android mobile device to process their customers’ payments. There are two general configurations one could use.
The first one is where a mobile card reader is attached to the mobile device. A physical credit or debit card is then swiped or inserted into the card reader for payment processing. This setup functions similarly to having a stand-alone credit card processing machine.
The second one utilizes mobile contactless payment technology. The business owner opens an app and enters the transaction details and amount to be collected. The customer then selects which payment method they want to use from their wallet, and then holds their smartphone near the business owner’s mobile device. The payment is then processed through the merchant services provider for approval.
How Are Mobile Payments Different from Online Payment Processing?
Mobile payments are not the same as online payment processing. There are some key differences. Most notably is that, with mobile payments, the credit or debit card data is digitally transmitted to the credit card processor.
This is considered the same as having a physical card to process the payment. As such, the transaction fees the business is charged are typically less than e-commerce transaction fees.
With online payment processing, customers add items to their virtual shopping carts. Once they are ready to check out of the online store, they manually enter in their credit card or debit card payment details.
The website processes the online transaction through a secure virtual terminal and payment gateway to obtain approval and complete the online order. Since the physical card is not present, the transaction fees are slightly higher.
Why Are Mobile Payments Important Today?
With the spread of the COVID-19 and the global pandemic, mobile payments are essential for any business owner that sells products or services. To help reduce the potential spread of the virus, one of the CDC’s recommendations is to limit touching objects and items that numerous people touch and use, such as credit card terminals.
Contactless mobile payments ensure that the customer never has to touch credit card terminals. They merely hold their smartphone over the terminal to have their payment processed. If the payment is declined, they can select a different card in their wallet to pay for their goods or services.
What Are the Benefits of Accepting Mobile Payments?
The number of people using mobile payments is on the rise. As a business owner, it is in your best interest to ensure you can provide your customers with mobile payment options. Some of the benefits you could gain from accepting mobile payments are:
- It is more convenient for your customers.
- Your customers will appreciate not having to dig out a credit card or debit card from their wallet or purse to pay for their goods or services. They also will never have to worry about leaving their credit or debit card at home. Additionally, they can store multiple cards in their wallet on their smartphone.
- Payments are processed much faster than using a physical card.
- It only takes a few seconds for your customer to wave their phone over the credit card terminal. The transaction completes almost instantaneously, depending on how your credit card terminal is connected to your merchant service
- It shows your business likes providing your customers access to the latest technologies.
- Customers like to see businesses that are up on the latest technologies that help make shopping more convenient and faster.
- Customers tend to spend more when using digital payment methods stored in their wallets.
- Most consumers that use mobile payments do not second guess their purchases. They like the convenience of using their mobile devices to pay for goods and services. As a result, they tend to spend more since they can store a wide range of payment options on their smartphones.
- Mobile payments are more secure than swiped, chipped, or manually entered transactions.
- Mobile payments utilize advanced security features to process payments. Rather than the actual card number and data being transmitted to the credit card processor, tokenization is used. This is where the mobile device creates a one-time use credit card number for each transaction. As such, the tokenized card number is no good even if a hacker obtains it since it cannot be used again.
- Mobile payments open up opportunities for better customer experiences. You can tie loyalty cards, digital coupons, and other such promotions in digital formats customers can load into their wallets on their mobile devices. When they want to redeem offers or load their customer loyalty number, they use their wallet. Afterward, they select the payment from their wallet to make their payment. You could even allow your customers to load a payment card to their online loyalty account settings for even faster checkouts.
- Mobile payments can simplify your bookkeeping and accounting processes. Since the payments are processed virtually, your merchant provider will have the data from each of the credit card companies and transactions you completed stored digitally. In most cases, all you have to do is download a file and import it into your accounting software.
As can be seen, offering mobile payment options for your customers opens the door for several additional benefits.
How to Choose the Best Way to Accept Credit and Debit Card Payments
To decide the best way to accept credit and debit card payments, you need to do a review of your current payment solutions. If you have an existing credit card terminal or POS system, it is easy to upgrade either of these to accept mobile payments.
All you need to do is reach out to your merchant account provider and ask what is needed to start offering mobile payments. Sometimes you might just need to download a software update for the equipment. Other times, you may need to upgrade to a newer POS system or credit card terminal.
Next, you need to consider what would be the most convenient for your customers. For example, if you own and operate a restaurant, it is more convenient to allow your customers to pay at the table.
Customers do not have to give their cards to their servers or stand in line to pay before they leave. If your servers already use a tablet device to place orders, these can be easily updated to accept mobile payments from your customers.
Additionally, if you want to provide your customer with more self-service options, mobile payments are a good choice. Ultimately, the best way for your business will depend on the goods or services you sell and the type of business you own and operate.
For further information about what your business needs to accept mobile payments, for help setting up a merchant account, and to take advantage of our flat-rate monthly fees for debit and credit card transactions, please feel free to contact Adept Payments at 888-732-3838 today!