Payment Acceptance: What Small Businesses Need to Know

As a small business, there are several things to keep track of: your customers, your goals, your payments, and more. Because of that, it’s important to stay on top of all the data that comes your way so that you can efficiently manage your workflow and make the most of your time.

When it comes to payment processing, especially with credit cards, it’s important to take several pieces of information into consideration. What are your business needs, and how might your operations benefit from a change in your payment acceptance methods? More specifically, you should take a close look at your:

1. Current payment acceptance method.
2. Online user experience.
3. Accepted payment types.
4. Necessary security measures.
5. Organizational needs.
6. Costs involved.

Are you ready to reevaluate your payment acceptance procedures? Let’s dive into these important points!

 

1. Current payment acceptance method.

When researching the best practices for payment acceptance, the first thing you want to do is look at your own business’s procedure. How do you handle payments now? What is your monthly processing volume?

Here are a couple of steps to take when reevaluating your current situation:

• Take a look at whether you use a merchant account or payment service provider (PSP). A merchant account is an account you can deposit funds into from completed card transactions. A PSP allows you to process card transactions without a merchant account. Your monthly sales volume may impact which one of these is the better investment.
• Determine if your merchant account or PSP works well your POS system. Take a look at your current POS system and see what’s working, and what areas could use more functionality. If you’re using a countertop credit card terminal, it might be more efficient to use something like an iPad POS system, which can handle additional functions, including inventory management and employee scheduling.

Take a look at your current POS system and payment processing procedures. Are they giving you all the functionality you need, or is there room for improvement? Getting a good idea of your starting point is an important first step in determining how to improve from where you are.

 

2. Online user experience.

If your customers are shopping and paying online, you want to ensure that your website and mobile interfaces are intuitive and fully functioning. In order to make sure this happens, you should make sure you offer easy options to log into your page for checkout.

Here are some tips you can note when setting up your online experience:

• Two-factor authorization. If your customers can’t log into their account easily, this might deter them from getting to the payment page and proceeding with their purchase. By using something like a two-factor authentication tool, your customers will be able to reach the pages they intended without difficulty.
• Password alternatives. Another way to create a user-friendly login experience is to provide alternatives to using a password, which you can read about here. This creates a friendly user-login experience and will help customers easily access your products.

By offering an easy user experience when your customers want to complete a purchase, this provides added convenience and increases the chances that your customers will complete their checkout. This ties into security and accepting certain payment methods, which will be discussed in the next two sections.

 

3. Accepted payment types.

Part of ensuring your customers’ convenience means accepting a variety of payment types. By offering this, you do more than just make it easy to pay. You also increase your revenue, because those who might not have been able to pay using a certain tender can use others.

You should be able to accept these payment forms:

• Credit or debit cards (for in-person and online transactions)
• Cash
• Checks
• Mobile pay

Most of the above tenders are straightforward, but mobile payments, in particular, is rising in popularity and is worth discussing in more detail. Essentially, mobile payment is payment performed from or via a mobile device. Accepting mobile payments can help cut costs because it eliminates the need for special equipment and software. It’s also a familiar technology that doesn’t require a lot of training and can get customers moving through the lines quickly.

By accepting a variety of payment methods, you can increase revenue and also ensure customer convenience. Consider these options and how you can incorporate mobile pay if you haven’t already.

 

4. Necessary security measures.

Of course, when handling your customers’ payments, you need to consider the level of security associated with your payment processor. Without incorporating security features and protecting the information you have, you run the risk of data breaches and hurting your business’s reputation.

It’s important to understand all the various elements at play with payment security. Consider the following:

• EMV chips. EMV chips are becoming standard for security measures and are on most credit cards today. They feature embedded microprocessor chips that store and protect the cardholder’s data. It’s important and safer to use a payment processor that accepts these chips.
• PCI compliance. PCI compliance is the security standard for organizations that handle credit cards. Be sure the payment processor you’re using is PCI compliant.
• Secure web pages. Be sure to use a secure web host so that your customers are comfortable browsing and placing orders on your website. There are many ways to improve your website security, and it’s important to take this seriously.
• Mobile payments. Mobile payments can either involve customers using their mobile devices to pay (think of Apple Pay, for example), or you swiping credit cards with your own device. While there can be security risks when using your mobile device to process payments, this is still rising in popularity, as mentioned before. When considering this method, look into how it could benefit your business and if it’s worth pursuing.

Obviously, with payment acceptance, there comes a level of security you should pursue in order to keep everyone’s information safe. Once you’ve researched the necessary precautions, you’ll be in a great place to safely accept payments and keep all the data protected.

 

5. Organizational needs.

When considering how to accept payments, another element you should look into is how you can keep your data organized, as well as what features you want to integrate with your system. To do this, take a close look at what your business’s needs are so you invest in the right software, without overpaying for features you don’t require.

In order to organize your data, consider the following options:

• Software integrations. Look for a POS system that offers integrations with accounting tools, customer management software, and more. For example, if you’re running a restaurant, Lavu’s restaurant POS software guide outlines the reasons you should invest in a robust POS system.
• Analytics reporting. Part of staying organized means generating reports. If you’re running the type of business that needs constant sales and inventory reports, consider a system that allows you to export a variety of these. This will help streamline your operations and make your workflow more manageable.

Keeping your data organized is key to efficient workflow and successful business. That’s why it’s important to do the required research and figure out exactly what your needs are as a business, how different payment processors and POS systems can benefit those needs, and where to go from there.

 

6. Costs involved.

The last thing to consider when choosing or upgrading your payment processor is, of course, the costs. Several fees may be charged, depending on how you run your payments, so it’s beneficial to know how these break down.

Consider the following processing fees:

• In-house processing fees. You’ll be charged either a monthly fee or a credit card processing fee (which makes up for not having a monthly fee) by your POS system.
• Merchant account processing fees. If you prefer to use the merchant account you already have set up, and want to use it with your POS system, this fee is dependent on the merchant account’s processing fees
• Credit card fees. Different POS systems charge different payment processing fees, such as flat-rate or tired. Take this into consideration when choosing a POS system and payment processor.

Another factor to keep in mind is the pricing plan of your payment processor. Consider the size of your business. Though it may start out small, it might grow substantially in the coming years. Think about how much it may grow, and incorporate that into the pricing plan you select.

For instance, if you think your business will grow substantially in the near future, you might want to use a scalable pricing plan. This will adjust with your sales and make it affordable to stay with the system you’re using.

Though fees will undoubtedly crop up when looking at prices, it’s important to determine what pricing plan best meets your business’s needs, and then pay attention to the fees to make sure you’re on the right path. There are several other pieces of information that are useful to know about processing credit cards, so be sure you have all the necessary details before you dive in.

When looking at the way your business accepts payments, there are a lot of factors to consider. But as long as you keep your business’s needs in mind and ensure that you invest in the right system that will help you along the way, you’ll be on your way to offering more convenience for your customers and for yourself.

Nonprofits have some of the most complex payment processing needs of any organizations. Explore Double the Donation’s guide for more ideas on the range of features and level of security to look for.

Try out these tips for your business and start witnessing the impact they can make!

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