How to accept credit card payments in-store or online

Despite the proliferation of new payment options, credit card transactions still take their place Supreme: 79% of the US population owns at least one credit card. An MIT study found that customers are willing to spend up to 100% more when paying with a credit card.

Many small business owners can make it easier for consumers to pay by linking up with a credit card . Yes, these payment processors charge a transaction fee, but they can be offset by the larger transaction amounts typically associated with accepting credit cards.

How does credit card payment work?

When a customer swipes, inserts, or taps their credit card at your physical payment terminal, your payment processor exchanges a series of messages with the customer’s financial institution, This will choose whether to accept the payment or not.

The payment processor is the conduit between the merchant (you) and the credit card company. In exchange for providing this service, the payment processor takes a cut of your credit card sales — typically 2% to 3% — and may also charge you a small flat fee per transaction. .

If the payment is approved, the money will go to your payment provider. After one to two business days, the balance (fees) will be deposited into your business checking bank account and the money is yours. Credit card companies also typically charge merchants 2.4% to 2.9% a purchase, plus an additional flat fee for each transaction.

How to accept credit card payments

Small business checking accounts will allow you to receive your earnings from credit card issuers. From there, setting up to receive payments depends on where the commerce takes place: at a brick-and-mortar store, online, or on the go.

How to accept credit card

payments in-store. In-store payments take place inside a brick-and-mortar retail store, restaurant, or office. If your business operates at a physical location, you will need the following services and equipment to accept credit card payments.

Payment processor. This is the provider that actually processes the transactions when your customers pay by credit card. Examples include Stripes and Squares. You can also sign up with a merchant account provider like Payment Depot or Stax. These services are like payment processors, but their regulations allow them to serve high-risk businesses (like telemarketing) or companies that need to process a large number of transactions. translation in one day. Due to its more complex nature, a merchant account can be overkill for most small business owners. You can also bypass payment processors and merchant accounts by conducting business through Shopify Payments. The platform does not require you to use a payment processor or merchant account to get paid.

Point of sale system. This is a hardware and software package for merchants that provides the physical and computer tools needed to complete payment transactions. The software component tracks your sales, monitors your inventory, and keeps you up to date with tax payments. Hardware components may include mobile card readers, stationary card readers, and barcode scanners. These plans are sold by payment providers like Shopify, PayPal, Square, Clover, Toast, and QuickBooks. You usually buy hardware and pay monthly fees for software services.

Payment terminals. . Some merchants use their payment terminal as part of a point of sale (POS) system. If your POS service does not offer a payment terminal, you can purchase one a la carte. You will use this device to process all physical credit card payments, including payments with magnetic strips, EMV chips, and touch-to-pay RFID chips.

How to accept credit card payments

Online Credit card payments, also known as e-commerce payments, include financial transactions made over the internet. Transactions on your Shopify e-commerce site are counted as online credit card payments.

Online payment systems work largely like traditional payment systems. Payment processors still transmit financial information, and a customer’s banks and credit card companies can approve or decline the transaction. As a seller, you can still expect money from sales