Who should use it: Mobile credit card processors are best suited for merchants that want to be able to accept credit cards anytime, anyplace. Some examples are repair people, food trucks and street vendors, as well as brick-and-mortar stores that want the option to accept credit and debit cards away from the cash register.
Merchant account: Just like merchant services providers, mobile credit card processors have their customers set up a merchant account to receive credit and debit card payments. The only difference is that these accounts can receive and process payments wirelessly.
Equipment: Mobile businesses need their own equipment to swipe credit cards, just as retail stores do. To accept credit cards via mobile devices, you will need a compatible smartphone or tablet — typically iOS or Android — a card reader that plugs directly into the device and the accompanying app from the provider. The smartphone or tablet then becomes a credit card payment terminal, complete with a swiper and other tools found on regular registers.
Cost: Mobile credit card processors have a fee structure similar to that of regular merchant services providers.
Security: In addition to obeying the PCI Data Security Standard, the best mobile credit card processors use websites that have both Secure Sockets Layer (SSL) protocol and encryption keys. In addition, the individual apps the business owner uses to accept the debit and credit cards often are password-protected and include additional safety measures in case the mobile device is lost or stolen.
Pros and cons: The ability to accept credit cards anywhere benefits both businesses and consumers. Not only does it promise significant revenue streams, but the convenience also enables businesses to provide better and faster customer service. By having mobility options, they’re free to collect payments from anywhere in the store — Apple and Nordstrom do this, for example — not just at the cash register. The major drawback is that there are fees. Business owners need to weigh their need for accepting credit and debit cards wirelessly versus the cost to do so. One important consideration is your customer base — if there aren’t many customers who want to make mobile debit or credit card purchases, the added cost of mobile credit card processors may not be worth it.
What to look for: There are a variety of mobile credit card processors, so it is important to compare the options before choosing one. According to the small business owners we spoke with, important considerations include monthly and individual transaction fees, and the type of equipment the processor offers. Whether businesses are using iOS, Android or BlackBerry devices, it is critical for mobile businesses to make sure the equipment the mobile credit card processor provides is compatible with the type of mobile device they use. The transaction features mobile business owners should look for include the ability to capture signatures directly onto a mobile device and calculate sales tax, accept tips, manage customer info, and email or text receipts.