It’s definitely in your best interest to accept credit cards for your small business. To help you get started, we’ve broken the process down into three simple steps – and we’ve listed the three best payment processors to use. First, decide how you will accept credit card payments. The primary options are:
In-person paymentsOnline paymentsMobile payments
Depending on the type of business you run, it might be quite clear what type of payments you’ll accept. For example, if you provide online services, chances are you’ll solely accept online payments. For other types of businesses, you might need a combination of payment methods. For example, maybe you run an online e-commerce site where you sell crafts, but you also sell them in-person at craft fairs. In that case, you would likely need both online and mobile payments. On the other hand, a new restaurant might need to accept primarily in-person payments but also allow for online payments for to-go orders. You know your business best, and only you can decide how you’ll need to accept payments. Step 2: Choose your payment processor In the past, you needed a merchant account to accept credit card payments for your small business. Your merchant account would provide payment processing, point of sale systems, and credit card terminals. While merchant accounts are still an option, they often require high fees and lengthy contracts. And thanks to technology, there are plenty of more affordable options available today. A payment processor or payment service provider provides a similar service as a merchant service without opening your own account. They allow for credit card processing and can provide any hardware you need without the costs and complications of a merchant account. Once you know how you’ll accept payments, it’s time to choose a payment processor. There are plenty of payment service providers to choose from, and it can be difficult to decide which one is best. Step 3: Get the right hardware and software Depending on the type of business you run, you might need to have hardware or software in place. If you run an entirely online business, you’ll need to set up your payment gateway on your business’s website. For businesses accepting in-person and mobile payments, you’ll need actual hardware. Some payment processors will even provide you with the point of sale equipment you’ll need to accept payments in person. First, PayPal accepts credit card readers that you can keep at your place of business or take with you on the go. Another option for in-person payments is a QR code, which your customer scans. This contactless payment method allows the customer to pay from their phone. Finally, PayPal provides payment processing for entirely online transactions. PayPal updated its fees on March 31, 2022. All of the information about the new fees can be found here. Square’s fees are as follows:
Card-present in-person payments: 2.6% + $0.10 per transactionCard-not-present in-person payments: 3.5% + $0.15 per transactionOnline payments: 2.9% + $0.30 per transaction
For small businesses that send monthly invoices, you can also set up recurring subscriptions and billing for credit card payments. Finally, Stripe provides Stripe Terminal, a point-of-sale device you can use to collect credit card payments, Google Pay, Apple Pay, and more. Stripe’s fees are customizable based on your business, but the standard fee for a successful card charge is 2.9% + $0.30 per transaction
