You put a lot of thought into providing a five-star experience for your customers. But, have you thought about how your payment options can positively or negatively impact that experience?
At one time or another, most of us have been in a situation where we couldn’t use our credit card at an “all cash” establishment, or a local business had a strict no-check policy that we learned about after we’d already begun filling in the blanks. And how many times have you heard about companies that don’t take Discover, Diner’s Club or American Express?
These references might seem dated, but you might be surprised by the following statistics:
- 55% of small businesses don’t take credit cards
- 20% of people still write checks
- As of 2020, there are 67 million American Express customers
The last few years have also seen the rapid adoption of mobile payments, including digital wallets, Square card readers, and cryptocurrency.
Though you might not need to take bitcoin in your office, you might want to consider other modern payment solutions like digital wallets, which include Apple Pay, Google Pay, etc.
In this article, we’ll give you step-by-step instructions to determine the right payment solutions for your business.
Step 1: Determine What Types of Payments You Want to Accept
As you’ve probably gathered, there are more payment options available than ever before. You can help figure out which ones you want to accept based on your business model and your customer base.
For example, if you collect payments outside of your office (at a tradeshow, convention, health screening, etc.), then you’ll need a mobile payment solution. Being able to collect payments over the phone or via text helps streamline the collections process and take the headache out of chasing debt.
Similarly, if you have a younger clientele, mobile payments can help set you apart. 65% of millennials have used mobile payments, compared to just 42% of the general population. As a reminder, mobile payments are when your customers pay you using their mobile phones, not a physical credit card.
As smartphones reach near 100% penetration and people are increasingly wary of carrying cash and cards, mobile payments are going to see ever-increasing adoption rates.
The bottom line here is that you should strongly consider mobile payments and evaluate whether they’re a good fit for your business.
Step 2: Consider Your Long-Term Needs
Often, small business owners fall into the trap of fulfilling their immediate needs without considering how their needs will evolve in the future.
Will you be adding a subscription service that requires recurring payments? Do you plan on having field employees that can accept payments on the road? Will you be unveiling a product at a tradeshow that you’d also like to sell on-site?
Think about where your business will be three to five years from now and tailor your payment solutions to fit the future needs of your organization.
Step 3: Look for a Payment Provider with Advanced Security
Hackers are getting smarter, bolder, and more ambitious. It seems like as soon as one type of security is developed, criminals find a vulnerability and exploit it. Even if you’re not ultra-technical, you can still ask the right questions. This step is extremely important because choosing a payment provider without the proper security protocols can be destructive to your business.
Your payment provider should be PCI-compliant. Short for Payment Card Industry, PCI compliance outlines a set of procedures that a company must meet to ensure that they’re protecting customer data. Specifically, your payment provider should use the following technologies:
- Tokenization: This process converts credit card numbers and other sensitive information into a token, which substitutes the original data and uses this instead, almost like a secret code.
- Point-to-point encryption: Abbreviated as P2PE, point-to-point encryption requires that customer data is immediately encrypted at your business’s POS (point-of-sale) terminal and must remain encrypted until it reaches the payment processor. This security measure protects data while it’s in transit.
- Fraud management tools: In addition to proactively protecting your data, your payment processor should also help detect fraud and alert you when it occurs. Examples include flagging a transaction where the credit card swipe occurred far from the billing address, a transaction that’s larger than normal, comparing CVVs (card verification values), blocking multiple attempts to make payments in rapid-fire sequence.
Step 4: Compare Payment Processing Fees
You have a lot of choices when it comes to payment solutions, and many companies are likely to compete for your business.
While you shouldn’t make a decision based on cost alone, you should have an idea of what your total bill will be and what factors can cause it to rise.
We encourage you to look at a few payment providers and evaluate the following:
- Transaction fees: What percentage of each transaction do you have to pay? Is there also a flat fee per transaction in addition to the rate? Are the fees refunded if you refund a payment?
- Upfront and leased cost for equipment: Do you have to purchase or lease equipment to get started? How much is it, and how often does it need to be replaced? Who is responsible for repairs?
- Penalties for exceeding daily or monthly quotas for the volume of transactions: Do you have a monthly limit on either the number or total dollar volume of your transactions before you get locked out of your system? What are the fees associated with these penalties?
- Penalties for not meeting a monthly quota: Conversely, do you get charged if you don’t have a minimum number of transactions?
Step 5: Ensure Access to Five-Star Customer Support
If you need support after hours, is it available? If your business operates outside of the traditional nine-to-five culture, then having access to 24/7 support is vital. We also recommend inquiring about support communication channels. Will you be able to speak to a customer support representative on the phone, or is all communication conducted via email or online chat?
There’s not a right or wrong answer here, but you should ensure that the support hours and channels are compatible with your schedule and communication preferences.
Step 6: Look for Systems that Offer Payment Integration
Ideally, you’ll be able to sync incoming transactions with the tools your business already uses. As you compare payment providers and processors, visit their website or contact their customer support team to find out which companies their platform integrates with.
When your payment solution integrates with other parts of your business, you’ll be better equipped to customize the user experience while helping to increase the efficiency of your team.
If there are no current integrations or the integrations don’t match your suite of tools, consider inquiring about whether they have a flexible or open API (application programming interface). If so, then you can work with a developer to program the integrations you need.
Step 7: Consider Recurring Billing
If you bill clients at regular intervals, then you should be able to receive payments automatically from customers on a subscription plan or an auto-debit program. Ideally, your system should also do some level of automated follow-up to attempt to collect failed payments.
Shopping for a payment solution for your business? You’ve come to the right place! We invite you to schedule a live demo of Weave Payments today.