Credit card payment, also known as plastic payment, is still one on the staple ways to pay for items online. According to statistics, last year alone four million new users begun paying with credit cards.
The same year almost 65 percent of houses in the United States used plastic payments. These and more statistics explain the increasing need to start collecting credit card payments.
Customers are moving towards a cashless economy with more preferring cards than cash. So being able to process credit card transactions opens a new opportunity to a business and offers shoppers a favorite payment method.
The Advantages of Collecting Credit Card Payments
- You get Instant Payments
Processing payments electronically is a fast, effective and hassle-free way to take payments from customers compared to other methods like invoices or checks.
Your finances reach you faster compared to other methods of taking payments. Plus, you do not have to handle cash payments because all payments enter your merchant account before they are finally transferred to your business account.
- Expand your Client base
A study posted in smallbiztrends.com mentioned that nearly 85 percent of small businesses experience an uptick in sales after taking credit card payments
Furthermore, 68 percent of customers are willing to pay for high-value items with cards, either credit or debit. Processing credit cards, therefore opens up a new opportunity to expand your client base.
- Your remain competitive
Because everyone is offering credit card payments in their businesses, the payment method is almost becoming a must-have for all retailers.
Failure to add the option can lead to abandonment in case customers find that you do not accept card payments.
The cost of Processing Credit Cards: Charges to Anticipate
Most fees linked to taking card payments come from processing fees which you must pay to take payments.
So what are some processing fees to expect?
- Transaction fees
- Monthly or account fees
- Incidental Fees
- Hardware costs
Business owners must inquire more about these fees before they start processing payments.
You’ll need a Payment Processing Or Merchant Account?
To process payments; a retailer needs a merchant account or payment processing account.
This account is linked to the processor who authorizes all transactions. Payment processing accounts receive payments collected from customers, and later moves the finances to a business banking account as per pre-discussed schedules.
And a Payment Gateway Too
A gateway links your web-based store to your payment processing or merchant account and acts as an intermediary for all the third-parties in a transaction as well as your bank and your shopper’s bank.
You may also need to pay some fees to your gateway provider.
Final Words
It is not easy to set up credit card payment processing solutions especially if you are new to the idea.
But these insights can get you started on the search for an effective solution.