Today, customers are now getting so much used to paying with credit cards that they hardly carry cash around. This explains why you must have a system for accepting credit card payments for your small business. Without such a system, your business would shut out several potential customers and lose out on tons of sales and profits, considering that customers paying with credit cards often spend more than those paying with cash.
Aside generating more sales and profits, accepting credit card payments will help you process orders quickly, thereby reducing customer waiting times (no more long queues due to counting of cash and verification of invoices and checks). In addition, since a credit card processing system provides for secure handling of payments, having one for your small business boosts credibility.
Switching from a cash-only model to one that allows your customers to pay with credit cards might seem like a difficult task. But it’s not, especially since there are a number of services and solutions that make it rather simple. These include merchant account services, payment gateway systems, mobile payment processors, credit card processing machines, and so on.
Here, we will be looking at how credit card credit card processing machines work and how you can get one for your business. Remember, there is much more to accepting credit card payments than getting the machines. But the bulk of this post will be about credit card processing machines.
How Do Credit Card Processing Machines Work
Once you insert a customer’s credit card into your credit card processing device (such as a point-of-sale machine, PIN-pad terminal, or simple swiper), the device starts “reading” the card. What actually happens is that the all the data from the magnetic stripe or chip on the card is transferred to the device while the card is being swiped through the slot.
The device reads the three tracks of data on the magnetic stripe: the cardholder’s name and other personal information, credit card number, and security and verification codes. Once your credit card processing devices has successfully captured these details, it prepares them for transmission.
During the transmission process, your credit card processing machine transmits the details on the card to your merchant account service provider. Some internal software handles the process of combining your merchant account details with the cardholder’s information. And this data is transmitted to the payment processor’s server by the credit card terminal.
The machine then awaits a response allowing or denying the transaction. If the transaction is approved, a unique authorization number identifying the specific purchase will be generated. In the case of debit cards, the cardholder might be required to provide the card’s four-digit PIN to verify that the card is being used by the legitimate owner.
The entire process or processing a credit card purchase and assigning a transaction approval number takes less than 5 seconds in most conditions. However, it might take longer where the internet connection is slow. After the entire processing, the credit card machine generates two receipts for the transaction, which sends to its internal printer. One receipt is for the cardholder to sign and is kept by the merchant, while the other is to be kept by the cardholder as evidence of the transaction and the merchant that facilitated it.
How to Get a Credit Card Processing Machine
Realistically, the truth is that there is nothing like the best credit card processing machine. You just have to find the one that suits your business and serves your purpose based on some criteria I will list below. Remember, what works for someone else business might not work for your business.
As stated earlier, getting a credit card processing machine for your small business is very easy. While there may be other ways to go about it, the easiest option is to employ a merchant account services provider, which is typically a bank or other financial institution that gives businesses the tools needed for credit card processing.
A merchant account services provider acts as the intermediary between your business and the customer’s bank or credit card company. They provide you with a merchant account, which processes payments ensures correct withdrawal of funds from a credit card account, and facilitates its placements into your bank account.
Once you apply for a merchant account and your application is approved. Your merchant service provider will give you all the various equipment you need to accept debit and credit cards. These credit card processing devices include point-of-sale terminals, simple swipers, PIN-pad terminals, and wireless terminals. You don’t have to get all of these; just request for what you need.
However, you must bear in mind that switching over to plastic payment methods come with a fee. Merchant account providers will charge you a fee per transaction or a flat monthly fee, or both. Before settling for a provider, be sure to compare the prices obtainable with a number of reputable providers.
- Check Online for Reviews-: To know the best portable credit card processing machines for small business, you need to go online and look for unbiased reviews about this product so that you can start earning money already.
- Check your present and future expected earnings-: The best credit card processing machine for you will depend on the volume of transaction and sales you handle. The more sales you handle, the more sophisticated your machine gets.
- Any machine you choose must be easy to install and use
- It must accept all payment
- It must have fraud security and protection
- Your portable credit card processing machine must be able to accept payment anywhere
- It must have POS/ Swipe features
- The monthly maintenance cost must be moderate
- Low start-up cost