February 12, 2019

Mobile Credit Card Processing

Read more about Business

Turning your phone into a credit card reader can be easy and even free. Before you start, read this to learn the pros and cons.

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Mobile credit card processing costs money. Some charge monthly while other companies charge per transaction or both. Not all companies are created equal, no matter what they promise. It may be simple to get up and running, but that doesn't mean there are no risks involved.

Keep reading to see which mobile credit card processing companies are worth your time.

What Is Mobile Credit Card Processing?

The ability to accept credit card payments no matter where you are is the gist of mobile credit card processing. With the ability to accept many types of credit card payments on your phone or tablet, you can take your business to the next level.

Using the headphone jack on your phone or tablet, your device turns into a credit card machine with the attachment of the card reader. Many readers and apps come with extensive reporting options and the ability to integrate with your POS system or online shopping cart.

What to Look for in a Mobile Credit Card Processing Company

A quick search online will deliver a whole host of mobile credit card processing companies. Knowing the important features you need/want will help you choose the right one.

  • Simple pricing: Credit card processors charge many fees, including per-transaction fees, monthly subscription fees, and PCI compliance fees, to name a few. The simpler the pricing structure, the easier it is to get started.

  • Simple setup: Not only do you want a reader you can plug in and start accepting payments, but you need one that will work well with your situation. If you are a new business, chances are a company that underwrites each potential client won't work well as you don't have a history of collecting payments. A company that automates the approval system may work better.

  • Accepted payment types: Will you accept swiped cards only? What about EMV (chip cards) or keyed-in transactions? Will you accept checks? These are all features you'll need to inquire about if you plan to accept them with your mobile credit card processor.

  • Integration with existing accounting software: Integrating your mobile credit card processor with your accounting software can cut down on a lot of back and forth, not to mention mistakes.

  • Point-of-sale system: If you plan to expand into online selling or a brick-and-mortar store, you'll need an all-in-one system that keeps track of payments, inventory, billing, labor hours, and more.

Best Mobile Credit Card Processing Companies

There's a lot to consider when choosing the right mobile credit card processing company. Focusing on those that don't require long-term contracts allows you some fluidity should you decide to change in the near future. Of course, the right company also offers the features you need to operate successfully.

Square: Best for Small Business

Cost: 2.75% per transaction (swipe or chip); 2.9% + $0.30 per eCommerce transaction; 3.15% plus $0.15 per keyed-in transaction

If there's a mobile credit card processing company everyone has heard of, it's Square. This mobile credit card processing service offers a host of services, including a POS, online storefront, and integration with your existing accounting software.

Square's pricing is straightforward (no interchange pricing to figure out) and there are no monthly charges. Businesses don't need to go through underwriting for approval. However, this does put your funds at risk if the company thinks your transactions are fraudulent or risky.

It takes a few hours to get your account set up and it works with both iOS and Android phones. The downside is their lack of customer service and the risk of frozen funds if they determine your business is "risky."

Intuit GoPayment: Best for Businesses Using QuickBooks

Cost: Varies (see below)

If integration with your POS and/or accounting software is important and you use QuickBooks, Intuit GoPayment is the right option. You can purchase the chip and magstripe reader for a small fee, download the app, and start accepting credit cards.

Intuit gives you two payment options. Pay as You Go doesn't have a monthly fee, but costs 2.4% for swiped cards and 3.4% for keyed-in cards. They also charge a flat $0.25 transaction fee on top of the percentage of your transaction. If you opt to pay the $20 monthly fee, your rates drop to 1.6% for swiped and 3.2% for keyed-in transactions. However, you still pay the $0.25 upcharge for each transaction.

FattMerchant: Best for High-Volume Transactions

Cost: $99 per month plus $0.15 per transaction

FattMerchant offers a unique pricing structure that works well for high-volume businesses. While at first you might balk at the $99 per month subscription fee, you'll see that it's offset by the flat pricing. Each mobile transaction costs $0.15 plus the required interchange fee. It's easy to see how this would benefit high volume producers, as it's easy to go over $99 in transaction fees with a small amount of sales.

They offer quick deposits (1 day for established customers) and 24/7 technical support. FattMerchant integrates with many other POS programs and doesn't require a contract. The program is simple to set up and use, enabling you to accept any swipe, chip, or keyed-in transaction on-the-go.

PayPal Here: Best for Online Businesses

Cost: 2.7% per transaction

If you already run an online business with PayPal, it's easy to institute PayPal Here, PayPal's mobile payment option. If you already collect payments via PayPal's merchant service, it makes sense to use their mobile option as well.

Their fees are lower than Squares by a small percentage - PayPal Here charges 2.7% versus Square's 2.75%. However, they do charge for the card readers and any other hardware you might need. The PayPal Mobile Card Reader will cost you just $14.99 and is a one-time fee.

PayPal Here doesn't charge any inactivity fees or have account minimums. In other words, you can purchase the reader and use it often or sporadically and you won't be penalized. One downside, however, is there is no guarantee of approval, even if you already have a PayPal merchant account.

PayAnywhere: Best on a Budget

Cost: 2.69% per transaction

New businesses that are on a strict budget, but that want to accept mobile payments, do well with PayAnywhere. They have the lowest per swipe fees in the industry at just $2.69. They also provide a free reader and app, helping you transform your phone or tablet into a credit card machine instantly.

The PayAnywhere app offers a few more benefits than just credit card acceptance, too. You can manage inventory, track customer purchases, and use multiple online resources. One thing to be careful with is their inactivity fee. While it's fairly liberal, as it's only charged if you are inactive for 12 months, it's still a $3.99 per month fee.

Other Mobile Credit Card Processing Companies to Consider

  • Cayan: If you are a busy merchant, you can accept swipe, chip, and NFC payments right on your iPhone or Android device with Cayan. Watch out for their $25 monthly minimum and hidden fees, such as the $7.95 statement fee, though. If you are good at negotiating, this is a tech-forward company that offers a solution for almost any type of sales, whether mobile, online, or in-store.

  • SumUp: This European mobile credit card processing app/reader brings new features to the US. With receipt printing options, multiple tax rates, and refunds, it may be the product you need for your business. You'll pay a one-time fee for the reader, but get low 2.6% per transaction pricing.

  • CloverGo: An add-on to its already large suite of credit card processing products, CloverGo brings similar features to the above products. CloverGo does offer more account stability, though, as it's a merchant account provider, not just a payment processor.

The Bottom Line

Choosing the right mobile credit card processing company is a big decision. Don't choose based on cost alone. Make sure you understand the features the programs offer to see if they fit in with what you need. If you already have a POS or payment processor for in-store transactions, make sure the mobile processor integrates with it for ease of bookkeeping and taxes.

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