There are several options for credit card processing setup that can work with small businesses. Two of the most popular choices are PayPal and Stripe, which offer simple setups, affordable rates, and seamless integration with websites and mobile apps. However, Square and Authorize.net are also good options with competitive fees and features.
When choosing a processor, you’ll want to compare rates, setup fees, monthly minimums, transaction fees, and non-recurring billing charges. PayPal has one of the smallest monthly fees at $30 but charges a percentage-based transaction cost. Stripe has no monthly fees or setup costs but charges 2.9% plus $0.30 per transaction. Square rates are similar to Stripe’s with no monthly costs. Authorize.net fees are a bit higher, around $75-$125 per month plus transaction charges.
Your business needs should determine which processor is the most practical and budget-friendly solution. If you sell mostly online or have a mobile business, PayPal or Stripe may be easier to integrate compared to Square or Authorize.net which require physical card readers. Processing 100-200 transactions per month? Square’s flat rate pricing could save you money. Serving local customers with in-person sales? Consider a portable Square reader.
To process credit card payments, you’ll need some essential equipment. The two most popular options are mobile card readers and desktop card readers.
Mobile card readers connect to your smartphone or tablet and allow you to accept payments on the go. Popular brands include Square, PayPal, and Clover. These typically cost between $29 to $99 with monthly fees around $30-$50. Mobile readers are ideal for small businesses with a lot of in-person sales and customer visits. However, they require a data connection to operate and battery life may be limited.
Desktop card readers plug into a computer or countertop and are good for businesses that process payments at a fixed retail location. Brands like Square, VeriFone, and Ingenico offer desktop readers starting at around $99 with no monthly fees. Compared to mobile readers, desktop units usually have larger screens, longer battery life, and help avoid the need for a data connection during payment processing. However, they are not practical if you sell at outdoor markets, craft fairs, or other off-site events.
In general, you do not need high-end, expensive equipment to get started with credit card processing as a small business. Basic, affordable mobile and desktop readers from reputable brands will work just fine for the average volume. Higher-end terminals with more features are best reserved for larger companies handling tens of thousands of card transactions per month.
To begin processing credit card payments, you need to establish a merchant account with your credit card processor. A merchant account essentially acts as a bank account, allowing you to deposit funds from sales and withdraw money as needed.
Setting up a merchant account usually involves providing some basic business information like:
The processing time to set up a merchant account averages around 3 to 5 business days. During this time, the credit card processor will review the information you submitted to verify legitimacy and compliance before activating your account. Some processors allow conditional access to funds for a period while they complete their due diligence.
Developing an efficient payment processing workflow is key to ensuring a great customer experience for your small business. A simple, seamless payment process will keep lines moving during busy times while still achieving PCI compliance standards for security.
Some essential steps to include in your payment workflow are:
Some additional tips for developing a seamless payment workflow:
As a business that processes credit card payments, you must comply with strict regulations to prevent fraud and protect customer data. The Payment Card Industry Security Standards Council (PCI SSC) sets guidelines for handling credit card information in a secure manner.
The PCI standards, known as PCI DSS, require several security measures for merchants:
Compliance is mandatory to continue accepting credit cards. Fines for non-compliance can be expensive, in some cases costing several million dollars per incident. By following the PCI DSS guidelines and maintaining security best practices, you can set up credit card processing without regulatory risk for your small business. Staying compliant will provide the peace of mind that comes with trustworthy practices.