One of the most important aspects you have to keep track of when you run a business is processing payments. In previous years, the remarkable growth of online payments has opened doors to more efficient contactless payment options for customers. Payment processing has been pushed to play a crucial role at the forefront of all business types.
Payment processing can make the whole ordeal of purchases easier and more seamless for customers and business owners alike. It may seem like a daunting task, especially if you’re starting or managing a small business, but it doesn’t have to be that way.
To help you understand what to expect, here’s a brief overview of what payment processing is and what to look for when choosing a payment processor for your business.
What is Payment Processing?
Payment processing refers to all the steps that take place from the moment a customer makes a payment for a good or service to when the money is transferred to the merchant’s account. To an onlooker, this usually takes seconds, but behind the scenes, it can be a complex series of procedures that includes authorization after a sale is made, and the verification, funding, and settling of a transaction.
Processing non-paper money from customers can be completed using various methods. This includes swipe and tap card terminals, mobile wallets, and point-of-sale systems. Payment processing is a crucial part of any business, as it allows customers to pay for goods and services quickly and efficiently.
Here are the top benefits that come with using payment processing for a business:
1. Increased Security
Payment processing allows you to accept various payment methods. This helps keep your business and customers safe.
2. Reduced Costs and Labor
When you use payment processing, you can save on costs associated with traditional methods of accepting payments. You’ll also save time by not manually processing paper-based payments.
3. Increased Efficiency
By using payment processing, you can speed up the checkout process for your customers, which will make them happier and more likely to return.
What are Payment Processors?
Payment processors serve as the link between your business and the bank or other financial institutions. They allow your business to accept a variety of payments at the same time. This makes purchasing more convenient for consumers. It also saves your company the resources and time allotted to complicated payment systems.
A processor can verify and authorize credit card transactions. This facilitates the movement of money towards your merchant account. They approve transactions and help ensure that your business gets paid on time. They do this for online payments (on websites) and in-person payments (on card readers).
What to Look for in a Payment Processor
If you’re in the market for a payment processor, here are a few things to keep in mind as you look for one that fits your needs.
1. Take Note of Prices and Fees
It’s crucial that you first factor in your business model, your budget, how much money your company is making monthly/annually, and how much you’re willing to spend on a payment processor before asking for a quote. This is especially important if you’re a small or medium-sized business owner. Hidden fees and costs can affect your business’s financial health if you’re not careful.
Do your homework and read up on the service agreement requirements of a potential payment processor. Some processors will have a higher rate for specific cards, while others might charge a flat rate. Don’t be afraid to ask what other kinds of fees they charge. Some might have set-up fees, statement fees, early termination fees, or fees when a certain number/amount of monthly transactions isn’t met.
2. Capacity to Support High-Volume Orders
Be sure that the processor can handle the volume of transactions you anticipate having. If you’re just starting, it’s okay to go with a smaller processor. But if you expect your business to grow quickly, choose one that can accommodate that growth. Speed is crucial when dealing with high-volume orders, especially when numerous customers are on your website, as the chances of long wait times increase.
While speed is essential when processing a high volume of payments, the ease of the checkout process is equally important. 87% of shoppers admit that they don’t proceed with a transaction if they find the checkout process complex.
So, search for a payment processor that can simplify your business’s payment and checkout process. Reducing the complexity of the checkout process can take many forms depending on your business type, but “the fewer clicks, the better” is a good rule of thumb to follow.
3. Check for Anti-Fraud Features
Another thing to consider when looking for a suitable payment processor is to look at their fraud-protection services. As credit card frauds and data breaches become more common, it’s important that you put data encryption at high priority and assure your customers that their transactions with your business are safe.
Look for a secure and trustworthy service that can identify and refuse fraudulent purchases. Be sure to ask your potential payment processors what type of security measures they have to protect against fraud and what their policies are if a breach does occur. Check if they follow the industry security standards and offer data encryption as mandated by PCI. As a merchant, it’s your responsibility to reduce the chances of fraud and prevent your data from getting stolen.
4. Look for Excellent Customer Support
You want to partner with a payment processor that will be there to help you every step of the way, whether you’re getting started or you’re ready to expand your business. They should have a dedicated support team who can answer all your questions and help you troubleshoot any issues you may have.
Try contacting potential payment processing candidates. You’ll immediately get a sense of how they deal with clients and how quickly they respond to concerns and inquiries.
Finding the right payment processor for your business is as important as finding the right business partner. You want to make sure you’re working with a company that is reputable, has excellent customer service, and can offer you the features and flexibility you need to grow your business. With so many options out there, it’s crucial that you take your time to research and evaluate the needs of your business before looking for a payment processor.
True POS is the one-stop hub for all your POS and payment processing needs. Get started with a free quote today!