Finance | Credit Cards

The 9 Best Cheapest Ways to Accept Credit Card Payments

A credit card refers to a payment card issued to users to enable them to pay a merchant for goods and services based on an agreement between the cardholder and the card issuer to pay for the amount owed plus other agreed charges. The cheapest way to accept credit card payment it depended on the type and the size of the business as discussed on this article.

The credit card payment mode plays an important role in the vicious cycle of increased consumption and production by enabling business people to have a guaranteed method of payment, convenient and secure form of payment to consumers by providing them with a solution in times of financial crisis. Also, in today’s economy it has changed consumers spending habits, the face of the business and global activity.

However, besides the payment by use of a credit card there are other reasons that one may need to transfer money from bank account either to pay for bills, send to family members or friends or for shopping. Understanding how to transfer money by using routing number and account number will help in transacting money from your bank account to the recipients.

What is a Routing Number and Account Number?

cheapest way to accept credit card payments

A rooting number is a code that is used in giving details on the location from where you opened your bank account. The ways of transfer cash depend on the level of the trust between the sender and the receiver, personal decisions and preferences.

It is very important while transacting to protect yourself from fraudsters by requesting monthly statements, destroying any unnecessary documents and by treat of personal information confidential.

What are the Ways to Transfer Money Using Routing Number and Account Number?

The following are some of the ways that can be used to transfer money into someone else’s bank account by use of account number and a rooting number.

i) BillPay

This is done by logging into the online bank account and select the option of sending to the receiver’s bank account. Then fill in the details of the receiver that is the name, routing number and the account number. Afterwards, the bank will email a paper check to the recipient and then the money will be received from 1-7 days.

ii) Bank to Bank

For this kind of transfer all you need to have is the recipient routing number and account number then send money directly to their account. The money takes up to 4 days to be available. You can also use a wire transfer by personally presenting details of the recipient entailing the name, account number, routing number and the address to the bank.

iii) Depositing directly

This mechanism is possible when t[you have the receivers routing number and the account number. You can either call the bank to do the transfer or log into your online bank account and go to the transfer option. Thereafter select the account number and the routing number you want to deposit in, enter the amount and complete the transactions.

iv) Bank to service banks

Some of the service providers of this transfer includes Wells Fargo SurePay, Zelle, Pop Money and Chase Quick Pay. For this one, you only need to provide details on the email account of the recipient and the phone number. The client will receive an email notification from the bank then they proceed to fill in the account details, account number and the routing number.

How can you accept credit card payment without a merchant account?

Accepting credit cards can be more advantageous for your small business. It gives your clients a convenient way to pay. No matter how new or small your business is, it is important to have the credit cards payment services. Unfortunately, accepting credit cards has never been that easy especially for the small businesses. For business to transact by use of a credit cards, they first have to open a merchant account.

A merchant account is the most common means of accepting online credit payments.  However, many merchants’ accounts are attached to a monthly substantial fee so you may want to look for other credit card processing for small business with no monthly fee.

With a traditional merchant account, monthly fees don’t take long to add up, despite the number of credit transactions you are making, the monthly costs have to be paid. Adding to that the transaction fee and other charges your credit processing can become very costly.

Setting up a merchant account can be a hefty exercise and time consuming for small business, other ways to accept credit card payments without a merchant account can work well for such businesses.  A merchant account comprises of an agreement between a retailer, a merchant bank and a payment processor for the settlement of a credit or debit cards transactions.

In order to accept credit card payments without a merchant account, you have to work with a third-party payment provider. These providers allow you to accept credit cards via their payment services that is an inbuilt merchant account.

Which are the 9 best ways to accept credit cards payment?

There are many ways to accept credit card payment which are either limited to specific countries or some work internationally. The most dominant credit service providers online include PayPal, square, helcim among others as discussed in details categorically below.

1) PayPal

PayPal was one of the first successful companies to allow small businesses to accept online payments without having merchant accounts and today still holds the position as one of the largest service providers in the world.

According to a Us publication, PayPal doesn’t charge setup or monthly fees but does charge a reasonable per transaction fee. For customers living in the United States and doing an online transaction, PayPal charges a standard fee of 2.9% of the transaction plus $0.30 USD.

Advantage

  • Extremely easy and simple to set up
  • Transparent on their add on charges
  • Accepts both the in person and online payments
  • Best for low volume businesses

Disadvantages

  • They are some charges that are incurred

2) Square

Square offers a powerful tool for accepting online transactions without having a merchant account. In the US for example, square offers a fee of 2.9% of the total transaction amount plus $0.30 USD the same as PayPal.  More than 2 million use square to process payments.

The additional benefit is that it offers discounts for small businesses based on the volume of sales they do. For international transactions, the costs incurred when using square are a bit costly.

Advantage

  • Pricing is straight forward and transparent
  • Tight security measures like end to end encryption
  • Fast processing of payment

Disadvantages

  • The services are not available 24/7

3) Helcim

Helcim is a payment processing service for online stores and retail locations. It is the best option for small business owners. Transparency takes the service provider on the high level of the best payment choice.

The Helcim will never increase its margin on the charges fee it always remains the same. The contracts are end to end and upon cancellation they don’t charge any fee.

Advantage

  • Prices are competitive and generally low
  • Ideal for small business
  • Their charges are constant

Disadvantages

  • Not suitable for businesses transacting less than $3000 per month

4) Stripe

When we talk of stripe, it is the affordable payment processor even for the starters. The fixed pricing strategy is transparent. If you’re accepting payment online, stripe should be of your top priority.

In addition, stripe is the best payment plan for your ecommerce site. According to a recent IDC report, business using this plan was able to achieve a revenue increment of 6.7%.

Advantage

  • Offers multi product and volume discounts
  • It is highly technical
  • In build fraud protection system
  • Suitable for ecommerce business

Disadvantages

  • The technicality can be a challenge for companies without a developer on staff

5) Flagship Merchant Services

More than 25000 small business holders use the above plan to process their credit cards payment. The advantage of the flagship merchant services is that everything is totally customized. The terms are flexible with month to month pricing for all businesses. While this payment may not be popular among the other payment plan options, working with a smaller company has its advantage.

Advantage

  • They offer 24/7 customer service
  • Their terms are flexible
  • There is customization of their services

Disadvantages

  • Complicated in terms of set up and getting
  • No contracts or pricing details

6) Skrill

Skrill is best known when it comes to making international payments. Globally, it covers more than 30 countries. When it comes to opening a Skrill account, you only need your email address and an active bank account. Upon opening, you are issued with a wallet which is your bank account.

You have to link the account with your bank account to get funds when you make a withdrawal. In every transaction at Skrill, a fee of 1.45% is involved which doesn’t have a significant effect on your profit margin.

Advantage

  • Flexible to the users
  • Account works with both Android and IOS
  • Enables International payments

Disadvantages

  • Fee in every transaction

7) Venmo

The most interesting thing about Venmo is that its dual purpose. You can use it for business transactions as well as sending money to friends. Apart from receiving payments, you can use Venmo to buy goods and services.  To use Venmo, you have to integrate it with either PayPal or Brain tree. However, statistics has it that PayPal is the best fit to make the integration.

Advantage

  • Dual purpose usage
  • Works both on website and app
  • Convenient to use on smartphones, iOS and android

Disadvantages

  • It’s not an independent entity

8) Braintree

Braintree is a subsidiary of PayPal. It accepts online and mobile payments in more than 45 countries and in more than 130 currencies globally. Addition of Hosted Fields to their Drop-in UI enables users to enjoy seamless checkout experience.

Big companies like Dropbox, Uber, Yelp, and GitHub among others use Braintree for their payment because it’s very convenient when it comes to receiving payment online. There are no hidden charges, the standard pricing is 2.9% and 0.30 cents per transaction. You can also get custom pricing if need be.

Advantage

  • Transparent charges
  • Highly convenient for online payment
  • High security levels from fraud

Disadvantages

  • It a dependent entity to PayPal

9) Amazon Pay

Amazon pay is one of the easiest ways to receive and make payments. Its popular among payment methods for small businesses. Shoppers, Charities, Merchants among others can conveniently use this service.

You can easily access your wallet for payments if you have this account. Furthermore, Amazon Pay is secure as it has fraud protection mechanisms that allows customers to get free alerts for security measures. Charges are 2.9% and 0.30 cents for each domestic us transactions, 3.9% for international transactions, and $20 for disputed charges.

Advantage

  • High security measures in place
  • Easy and convenient to use
  • Most ideal for small businesses

Disadvantages

  • It’s a bit expensive

Why should business accept credit card payments?

Accepting credit card payments provides flexibility and convenience to your customers and its quite beneficial to your business. The benefit of accepting credit card payments for small business entails the following.

a) Increases sales volume

The accepting of the credit cards is a plus to small business holders as it can help them to attract new clients improving their sales. Nowadays, people tend to spend more when they are transacting by use of credit card payments rather than cash hence adopting this mode of payment for a business translates to more sales.

b) Empowers the client experience

Offering diverse payment options that is inclusive of credit payments gives your customers a better experience and builds trust. The preference of using a credit card by a lot of clients is the simplicity of processing the payment online.

c) Increases cash flow

Unlike cheques, which take a period of 5-10 business for the processing of payment, credit card payment usually takes effect quickly. Basically, the credit card payments are cleared and the money is deposited in your business bank account within a day or two of the transaction.

d) Reduces payment insecurity

Accepting credit card payment means that your business has less cash at hand hence reduces the incidences of theft and loss. Although there are some security risks involved in accepting credit cards, in most cases fraudster charges can be contained by use of a merchant service provider.

e) Time saving

Most credit card processors enable you to accept credit cards payments with just a simple procedure saving your time. You don’t necessarily have to go to the bank to deposit cheques or spend a lot of your time requesting for payments.

f) Provides useful reports

While using the credit card payment, you’ll be able to aggregate useful data on the types of payment customers use, how long it takes them to pay and the optimum payment amount your business gets. With this information, it becomes easy whenever you are filing tax returns for your business.

Bottom Line

Ultimately, in every business there is a dire need to accept credit cards payments whether you are doing online business, in store or both. The choice of the suitable credit card payment depends on the flexibility of the terms, transaction fee and contract terms.

However, it is important to note that you have the option to accept credit card payments without a merchant account but it doesn’t mean that providers like square, PayPal and the rest will work better. Therefore, it’s important to do thorough research depending on your specific business and your needs.

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