Do you own one of the 33 million small businesses in the U.S.? If so, one thing you should focus on is ensuring your credit card processing is efficient.
Why is this so important? Simple: credit card payments make it much easier to keep a tight handle on your cash flow. These transactions speed up payments and reduce or eliminate delays associated with checks.
Of course, processing credit card payments efficiently isn’t always a simple task. If you’re struggling with this aspect of your business, this guide will help you manage it!
How to Process Credit Card Payments
First things first: how do you process credit card payments in the first place? If you haven’t done so yet, there are a few key steps to go through.
Decide How You’ll Accept Payments
These days, you’ve got plenty of options for processing a credit card transaction. You can accept these payments:
- Online
- In-person
- Over the phone
- Via a mobile card reader
Choosing between these options will depend on the type of business you run. In a brick-and-mortar store, it makes sense to accept payments at checkout. With a mobile business, you’ll likely need a mobile card reader.
Choose a Processing System
Credit card payments are more complex than inserting or swiping the card. To authorize the payment, you must review their card and account details. This happens automatically, but you need to hire a payment processor to do it.
There are two ways to accept credit cards: merchant accounts and payment service providers. The former is an account you can open with a bank. The latter is a company that allows you to accept credit cards without a merchant account.
In general, payment service providers charge lower transaction and processing fees. This is a good option if your business is new or you have a low volume of credit card payments. Otherwise, merchant services make more sense.
Integrate Your Payment Method
Once you choose a method for accepting credit card payments, you’ll need to integrate it with your existing hardware. You may also have to update your point of sale (POS) software to support the new payment method.
Let’s say you own a brick-and-mortar business. If so, you may need to install an EMV card reader or invest in new checkout software. Some payment providers make this easier for you by supplying the right equipment.
How to Accept Online Payments
Whatever type of business you own, there’s little reason not to accept credit cards online. Giving customers options is a surefire way to boost sales.
On top of that, providing this service isn’t too complicated. All you need to do is set up your payment gateway to accept online credit card transactions. Again, this may be included in your processing plan.
The only other thing you’ll need is a digital storefront. The most common way of getting it is to set up an account with an e-commerce platform provider. Fortunately, all major e-commerce platforms now support credit cards.
Tips for Efficient Credit Card Processing
Now that you know how to accept credit cards, let’s go over how to do it efficiently. Here are some payment processing tips every business owner should know.
Know Where Your Money Goes
Finding a good credit card processing rate is all about doing research on credit card fees. In general, interchange rates are usually a good option. These are fixed expenses, and they’re the same for all payment processors.
You should also look into assessment fees. They’re also known as:
- Card brand fees
- Card network fees
- Card association fees
- Network Access and Brand Usage fees
These fees are the costs passed through to credit card brands like Visa and Mastercard. Each brand charges its fees at different prices and they update them quite often. Keeping track of these fees is essential.
Secure Your Transactions
Secure payment processing is both in your and your customers’ best interest. It ensures your business will remain trustworthy. It also minimizes any financial losses that may come from the fines associated with compromised data.
For an example of what not to do, look at what happened to Target in 2013. Following a huge data breach, they had to pay an $18 million settlement. However, their actual losses are estimated at somewhere around $291 million.
Use Address Verification Services
The Address Verification System (AVS) is a fraud prevention measure for card-not-present transactions. It compares the billing address provided in the transaction with the address on file with the card issuer.
AVS doesn’t detect all types of fraud, but it’s a great way to prevent suspicious transactions. In most cases, you’ll implement AVS through your credit card processor. You’ll also need to keep track of its effectiveness over time.
Optimize Your Processing Speed
At best, slow transaction speeds result in customer annoyance. At worst, they’ll directly affect your sales volume. To ensure your processing speeds are sufficient, you should:
- Choose a reliable payment processor
- Update your POS equipment regularly
- Maintain a stable internet connection
Another way to optimize your processing speed is to focus on reducing friction in your checkout process. Whenever possible, reduce the number of prompts your customers must click through to complete a transaction.
Train Your Staff
With in-person payments, your staff will likely be the weakest point in the transaction process. To avoid human error and help them handle customer data efficiently, it’s important to provide effective training.
Some key areas you should train your staff in include:
- Keeping customer data protected
- Recognizing payment processing risks
- Creating strong passwords for any systems they access
Need Help With Processing Credit Card Payments?
As you can see, processing credit card payments isn’t a walk in the park. A lot of it boils down to choosing the right payment processing service. Having a reliable partner takes a lot of stress out of this process.
Looking for a one-stop payment processing solution? At Trinity Payments, we tailor our services to the individual needs of our partners. We also offer transparent pricing and industry-leading innovation!
Want to get in touch with us? Fill out this online form to get started!
