Credit card payments are a great way to add extra cash to your pocket. But with numerous services available, knowing what’s right for your business can be challenging.
Here are some things you need to know before getting started:
Set Up Credit Card Processing Based on Your Needs
You need a merchant account with a payment processor. That’s pretty straightforward, but you might wonder: What kind of merchant account do I need?
It depends on your setup.
If you have any physical locations and accept credit cards over the phone or in person, you’ll probably want a traditional merchant account that handles transaction processing and sales taxes.
If not, you’ll probably want an ecommerce-specific payment gateway (think Stripe or Braintree) that allows you to accept credit cards online.
What info/documents do you need?
There are no set industry standards for merchant account providers when it comes to accepting credit cards. However, most companies will ask for basic information about your business and its operations before offering their services. For example:
- Name and address of your business
- The name of your state (or country) of incorporation or registration
- How long your company has been in operation
- Business permits
- The type of business you’re running (e.g., online retail store)
- Your business financial information
However, it’s important to understand that not every payment processor is created equal. Many of them have different fees, offer different features, and work differently.
What do payment providers look for?
Before applying for payment processing, you’ll want to know what types of transactions your business accepts and how much revenue it generates each year.
These are two critical pieces of information that all processors look at when determining whether or not they’ll approve your application.
Most processors will also check whether your business is “high-risk” based on their own definition. If they consider you risky, some will offer you high-risk processing services, while others will turn you down depending on their company policy.
Choosing the Right Credit Card Processor
When it comes to collecting credit card payments, most ecommerce store owners are focused on how they can process and collect their customers’ payments.
They want to know how much money they can earn, how many customers they can handle, and how fast they can get paid. However, there are other considerations such as:
- How long will it take to process a payment after a customer makes one?
- Can the customer’s bank account be verified?
- How does the payment processor fit into your business
- What type of fraud protection is offered by the processor?
- What is the cost of accepting credit cards for your business (can you afford it)?
Remember, you need to choose a payment processor that’s right for your business, but also find something that fits your budget.
SummaryHere’s a complete guide on how to accept payment processing in your small business.