These days, more consumers are looking to make purchases using debit and credit cards instead of cash, and a large number of businesses nationwide are trying to accommodate that demand by adopting mobile payment processing services.
In the past, many smaller businesses were hesitant to begin accepting credit cards because of the high cost of installing the hardware and software associated with point-of-sale card readers issued by major payment processors, but technology is fundamentally changing the way these transactions can be processed, according to a report from Mac World. Now, a growing number of companies are offering mobile credit card readers that plug into smartphones and tablet devices to process these types of transactions.
The benefit for businesses is that there are typically little to no startup costs associated with acquiring these devices, and the transaction fees the companies issuing the readers charge are traditionally well below those of larger payment processors, the report said. For instance, PayAnywhere charges the lowest typical rate of any of the four major mobile payment processors at 2.69 percent of the value of a processed transaction, while Square’s is highest at 2.75 percent.
Two of the other major competitors allow businesses that process more than $1,300 per month in sales to save more per transaction if they pay a monthly subscription fee, the report said. Intuit’s GoPayment system charges a $13 monthly fee, but reduces the individual swipe fee to 1.7 percent, while VeriFone’s Sail charges $10 per month for a swipe fee of 1.95 percent.
In addition, these systems all have vastly different mobile device applications associated with them, the report said. Depending on the mobile operating system and payment processing platform a company uses, some will enable users to receive their payments and track all types of transactions more easily, print paper receipts, track inventory, scan barcodes and more.
Typically, the card readers issued by these mobile payment processors are available at a relatively low cost, and most of the money charged for buying the device is credited to an account when it’s opened, the report said.
Mobile payments are seen as the wave of the future in the credit card industry, but at this point, there is some hesitation among consumers to adopt this type of purchase method, due largely to concerns over its security.
Image: Images_of_Money, via Flickr