5 things to remember about mobile credit card processing

5 things to remember about mobile credit card processing

While applications, or apps, have made it possible for small businesses to process credit card transactions using their Apple iPhones or other smart phones, there are a few drawbacks to using this technology.

Here are five reasons mobile credit card processing might not be beneficial for your company.

1. Signal availability. The signal coverage for mobile credit card processing may vary from network to network. It will not be beneficial to your business if you lack an Internet connection or signal in some areas where you do business. Merchants should check their cell phone provider's coverage map before signing up for mobile credit card processing. Also, ask the processing company if transactions can be stored on your phone in the event of a signal loss.

2. Fees. Consider the fees associated with mobile credit card processing and ask about hidden fees. According to Wired, there is a flat rate transaction fee of 2.75 percent for physically swiped credit cards through companies such as Square. There is an additional 15-cent fee for every purchase; this rate applies to Visa, MasterCard, Discover and American Express. Manually keyed-in transactions for cards that are not present have slightly higher rates.

3. Chargebacks. Providing credit cards as a method of payment can lead to an increase in chargebacks. Consumers can dispute a charge and the merchant is often stuck with paying the interchange fees just like with a standard merchant account.

4. Security. There are some security concerns for consumers and merchants when it comes to mobile credit card processing. Hackers are always looking for ways to acquire sensitive data from new technology. Mobile hacking can be very bad for business. Be sure to choose a reliable provider and ask about SSL encryption and other security features they might offer.

5. Printing costs. Many mobile credit card processing apps e-mail a receipt right after a transaction; some consumers prefer having a printed receipt. E-mailed receipts also can pose a problem for customers who do not have an e-mail account or need a receipt instantly. This might be a costly expense for your business when you consider the cost of a mobile printer and ink to print out just a few receipts.

 

Published: June 21,2023