A source of frustration for many sellers, especially those with non-traditional venues, can be credit card processing. You may not be able to use a hard-wired credit card reader, and processing cards via an Internet connection (if one is available at all) can also be a challenge. That's why several companies have created credit card reading devices and applications for smart phones.
Included in this overview of credit card reading devices are both mobile apps and what are known as "dongles." A dongle is simply a piece of hardware - in this case the mag stripe reader - that attaches to the mobile phone and allows the secured software application to run. Some credit card readers don't require the physical hardware piece, while others offer the option of entering a credit card number manually or swiping the card.
Since the top three mobile devices in the United States include Apple's iPhone or iPad, phones running Google's Android operating system, and Research in Motion's Blackberry, this overview covers several options for each platform.
1. Square. One of the best known credit card processing apps, Square includes a proprietary dongle that plugs directly into your Android, iPad, iPhone, or iTouch headphone jack, but gives you the option of swiping or typing in credit card info. The only catch is that manual entries carry a higher processing fee than do swipes. Swipe a customer's credit card and it'll cost you a flat 2.75%, while typing in the card number runs 3.5% + $0.15 per transaction.
Square users must be running Android 2.1 or Apple iOS 4.0, and have a GPS enabled device with a 3.5" headphone jack. The card reader and mobile app are free, and the mobile app can be downloaded via your mobile device. Currently, Square is not available for Android tablets.
An additional note. If you have the option of choosing between a regular merchant account for credit card processing or using Square, you can use this calculator to help you compare the two and find the best value for your business.
2. Intuit GoPayment. Created by the maker of the well-known accounting software, GoPayment is also available for the top three smartphone platforms. The pricing plan has two options, pay-as-you-go for businesses with fewer transactions or a high-volume option requiring a monthly service fee offset by lower transaction costs. Both plans include a free app and card reader plus no setup fees or monthly minimums.
The pay-as-you-go plan charges a 2.7% transaction fee for swipes versus 3.7% for manually entered card numbers. High-volume customers will pay $12.95 per month along with a 1.7% transaction fee on swiped cards, or 2.7% for keyed entries. And those using certain versions of Quick Books can download transactions directly to the software program.
3. BlackCharge. Formerly known as BlackCard, this mobile credit card processing service for the Blackberry offers the option of setting up a merchant account through NoblePay. The app costs $4.99 and requires a supported phone running software of 4.6.0 or higher. Payment gateway options are limited to Authorize.Net, NMI, and Pay Pal Pro. There are no additional fees or transaction percentages charged for using the app, but the standard credit card payment processing fees still apply.
4. iPay POS. A versatile mobile processing solution for Apple mobile devices including the iPhone, iPad, and iTouch, iPay POS offers access to multiple payment gateways. You'll need a merchant account to get started, but iPay POS does not lock you into one of their merchant account providers. The mobile app is free but you'll need to buy a mag stripe reader, selecting from a growing list of compatible card readers such as iMag, uniMag, Daily Systems, and the P25 Mi combination reader and printer.
Credit card processing fees will depend on the providers you select. But like most credit card reading devices, you'll have the option of emailing a transaction receipt to your customer.
5. MerchantWARE Mobile. Compatible with all three major smartphone platforms plus the Windows phone, MerchantWARE Mobile offers a free app, along with no additional fees when you establish a merchant account with Merchant Warehouse. You can process credit cards with your Blackberry Curve, Storm, Pearl, and Bold and also email receipts to customers.
6. Mobile Merchant Pro. Another credit card processing device that's compatible with the big three mobile platforms, Mobile Merchant Pro offers a free app for Android, Apple, and Blackberry and requires a merchant account to get started. It's compatible with the popular payment gateway Authorize.Net, as well as PayPal Web Payments Pro (requires an upgrade plus an additional monthly fee, and zoomgate).
7. Merchant On the Move. Merchant On the Move allows you to accept credit cards on your Android, iPhone, Blackberry, Palm, or Windows mobile device using either a mag stripe reader or keying in the credit card number directly. As with other credit card processing solutions, swiping the card offers a lower transaction fee of 1.69% while entering the card number carries a 2.2% fee plus $0.30 per transaction. Merchant On the Move also carries a flat monthly fee of $24.95. A portable combination card reader and thermal printer is available at an additional cost.
Choosing a credit card reading device, whether it be just a mobile app or the combination of a mag stripe reader and smartphone software requires a little research and a basic idea of how you plan to integrate credit card acceptance into your business model. These seven choices give you a starting point and bring up questions you'll want to answer before you begin.
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