acceptance of credit cards

[Porterswood]

I am starting a new business in the pet industry and have come to a conundrum. I will be doing business via the internet, person to person and also shows. Besides Paypal I would like to offer Visa and Mastercard as payment.
Doing some due dilligence I have become confused by the many means to take payment. I spoke to my bank who has my business account about the use of their terminal and accounting practices, and have found them to be almost prohibitive in fees and contract sign ups.
I thought also about using Square but the reviews are horrible. I worry about not being paid in the end.

So my question is this, do I just suck it up deal with my bank because of its security or not worry about the bad press from companies like Square?

Your thoughts on this would be greatly appreciated.

Mark

[Freelancier]

You have LOTS of options when it comes to taking credit cards. It sounds like you should find a company that offers the bolt-on card swipers for your smartphone (so that you can take cards when you're doing business person-to-person) as well as internet and maybe a terminal. If you're doing enough business, start with a well-known company like Authorize.Net that has lots of partners and see what they can offer you for all the different ways you want to take cards. They may know a partner or two who can offer you the different services you want at a much lower cost than most banks.

[tallen]

I've been using the Square for taking cards in person with no problems, so I'm curious about the bad press you refer to. But the main reason for my post is simply to point out that you don't necessarily have to go with just one provider to cover all possible ways of taking a card. For Example, you could use a hybrid solution of PayPal for online payments, Square for in-person, and your bank's virtual terminal for phone transactions (just an example). Also, you need to recognize that the costs are highly dependent on the volume of business you do. In other word's, PayPal's or Square's transaction rates might seem high compared to the other providers, but they don't have monthly charges, set-up costs, or equipment fees, so depending on the size of your business you might come out ahead with PayPal and/or Square. You can always try Square and/or PayPal for starters (there is no start-up cost) to see how they work for you, especially if you need to get going right away, as you continue to investigate the alternatives. Finally, if you want to take cards at shows, or other on-the-road/away-from-office situations, the cell phone plug-ins (a la Square) seem to be dominating that market...

[gregcooper420]

Mobile card payment solutions like square makes the customer and business transaction experience go by smoother. Using mobile card payments can also help your business operation with bookkeeping and other operation, the only benefit I see with regular card system is the amount of security that is involved compared to mobile card payment. There are various mobile systems available besides square, you should see which ones are constantly updating there security protocol and suit your business best.

[Porterswood]

Thank you all for your comments and suggestions.
Tallen, to answer your question. I do a lot of research before making a choice in most things I do, and was ready to pull the trigger on Square. I did review search on Square and was shocked by the amount of people who had accounts frozen and assets kept by Square. Much of it had to do with transaction limits, and contractual agreements. I was really surprised that Square was so abrupt in there choice of account closures and holding someones money because of the error. I would have thought Square would be willing to negotiate a new contract to meet the needs of the business. I was also surprise how many class action suites are filed against them along with civil suites for complanies to recoup their income.

Again I think you all for your input. I will follow your suggestions and perhaps create that hybrid situation that was suggested.

Mark

[BIZDEV]

I was going to suggest Square or PayPal. Both offer the smart phone swipe option. I was terrified of PayPal for the exact same reasons you are afraid of Square. But I have never had a single problem with PayPal. I'm set up to use Square but have not yet used it so I can't speak directly about their service.

[KristineS]

If you're already using Paypal, they do have some options for businesses that might work for you. We use WebSite Payments Pro for our website and for our trade show sales and it's worked well for us. I'm not impressed with the Paypal Here option, but we've worked around that.

[Twhansbury]

Porterswood,

You also should consider your web site and the integration.
If you are unsure but need to get the tires on the road. Use Paypal and either grown with it or the change/adding additional payment services will be easy.
Tho its new i also suggest you look into other payment options. Specifically Bit-coins, Coinbase i recommend for wallet and also their merchant services.
A referral link (disclaimer I get $5) is here
https://coinbase.com/?r=5269254b3b055e704900010f&utm_campaign=user-referral&src=referral-link

[Twhansbury]

Porterswood,

You also should consider your web site and the integration.
If you are unsure but need to get the tires on the road. Use Paypal and either grown with it or the change/adding additional payment services will be easy.
Tho its new i also suggest you look into other payment options. Specifically Bit-coins, Coinbase i recommend for wallet and also their merchant services.
A referral link (disclaimer you get $5 for setting up account and I get $5) is here
https://coinbase.com/?r=5269254b3b055e704900010f&utm_campaign=user-referral&src=referral-link

[Harold Mansfield]

I am starting a new business in the pet industry and have come to a conundrum. I will be doing business via the internet, person to person and also shows. Besides Paypal I would like to offer Visa and Mastercard as payment.

Just wanted to add that Pay Pal is a card processor that allows you to accept all major credit and debit cards. Not sure why people keep thinking that it's only for people who have Pay Pal accounts.

[tallen]

Yes, and with Square you can take Discover and American Express as well. Even if you go with another solution for most of your card processing, it could be worthwhile keeping a Square handy just to be able to accept the occasional AmEx card! Edited to add: I guess with PayPal you can take AmEx as well.

[RiskyBusiness]

Hi all!
I'm new to this forum but thought I might be able to add some helpful info. I've been in the merchant service industry for.... longer then I care to admit. When it comes to products such as Paypal, google checkout, amazon, square and things of that like, you're going to get what you pay for. Understand, I don't knock any of these products but they have a thresholds when it comes to businesses growing. They're not a bad place to start but as your business grows they're just not built to handle you. This is why you run into problems of having funds frozen, accounts closed for unexplained reasons and heavy lack of support and additional solutions. There is no such thing as a direct processor, unless you're Walmart, despite all the claims you can find online or hear over the phone from a cold call. Merchant services is a very convoluted industry and takes years to get a base understanding of how it works. I've been doing this a loooooooong time and I'm not close to knowing everything about it. You have to be careful when choosing who to give your processing to, and your local bank is definitely not the answer. I'm happy to help shed light on anything related to the merchant service world. If I don't have the answer, I have great banking people that will. Please feel free to utilize my knowledge and experience.

[billbenson]

Just wanted to add that Pay Pal is a card processor that allows you to accept all major credit and debit cards. Not sure why people keep thinking that it's only for people who have Pay Pal accounts.

The issue is PayPal is not appropriate for all industries. It's common in the web industries like yours or Godaddy. In my industry it would scream small company when I try to present myself as bigger than I am. I've been at this since about 1995 and have had thousands of transactions.Never once has a customer mentioned the word PayPal. No way would I put a PayPal logo on my website.

Again, I'm not saying there is anything wrong with PayPal. I'm just saying its not appropriate for all industries.

[Harold Mansfield]

The issue is PayPal is not appropriate for all industries. It's common in the web industries like yours or Godaddy. In my industry it would scream small company when I try to present myself as bigger than I am. I've been at this since about 1995 and have had thousands of transactions.Never once has a customer mentioned the word PayPal. No way would I put a PayPal logo on my website.

Again, I'm not saying there is anything wrong with PayPal. I'm just saying its not appropriate for all industries.

Yes, we've discussed before. I wouldn't use Pay Pal either if I were taking 5 and 6 figure payments. That's just not how it's done. But for online retailers and merchants it's perfectly acceptable and credible.

[RiskyBusiness]

The issue is PayPal is not appropriate for all industries. It's common in the web industries like yours or Godaddy. In my industry it would scream small company when I try to present myself as bigger than I am. I've been at this since about 1995 and have had thousands of transactions.Never once has a customer mentioned the word PayPal. No way would I put a PayPal logo on my website.

Again, I'm not saying there is anything wrong with PayPal. I'm just saying its not appropriate for all industries.

Couldn't agree more

[RiskyBusiness]

I think of paypal as more of a "spring board" into a merchant account for a new or small online business. Most businesses tend to outgrow them very fast.

[Harold Mansfield]

I think of paypal as more of a "spring board" into a merchant account for a new or small online business. Most businesses tend to outgrow them very fast.

Really? Macy's, Walmart, Overstock, Best Buy and a crap load of other major online retailers use Pay Pal successfully with no problem.

No one thing is perfect for every occasion, choose the one that is best for you. But I don't know why people keep trying to make Pay Pal into some starter system for novices. They do $6 billion a year in ecommerce transactions, are in over 190 countries and have well over 137 million active accounts. Pay Pal is the most used and recognized payment gateway in the world doing 8 million transactions a day.

And yet people still talk about it like it's Moneybookers or something. I don't get it.

When it comes to stability, and customer service I know I can count on Pay Pal and can get someone on the phone quickly. I can't say the same for a lot of services and I've had to work with many over the years for various websites. Sometimes the service is worth the extra .05% in fees. Especially for a major or growing retailer. People like Macy's don't screw around, they go with what is proven, reliable and the best for their customers. They aren't going to use Bob's Card Processing just to save a percent in fees.

But like I said, use what's right for your business.

[billbenson]

Ya, my prejudice against PayPal 8 years ago or more. They had really bad customer service and were known for holding on to customers money for 6 months if the customer in any way violated their T's and C's. But that was then and I'm sure it's a different company now. It's really been a long time since I've seen a PayPal hating post. And I use them for paying my web hosting and other stuff. I'll stand by my other statement that they aren't appropriate for all businesses, but when you don't see negative stuff on the internet for years it's probably a good credit card processor today.

[billbenson]

I'll add to my paypal post above, they seemed to not like sites with high dollar purchases at that time. Most of my orders were declined. Their business model seemed to be that they liked a lot of small dollar purchases and didn't want the risk of large purchases. I have no idea if that is true today. I had orders from the Navy declined.

[Harold Mansfield]

It was rough a few years back. No question. There was also a crap load of fraud going on. People were buying and selling American bank accounts and cards to verify Pay Pal accounts, identities were hard to confirm in areas like India, Pakistan, Russian and China, people were laundering money, and fraudulent sites were everywhere. I remember those days. Some webmaster forums were full of threads by people trying to find a way to scam or fake Pay Pal out.
I'm sure if every duck wasn't in a row Pay Pal looked at everyone like suspects.

[huggytree]

you can shop around.....I started accepting credit cards about 7 months ago....you have to accept there's going to be start up fee's and monthly fees....shop around to find the best deal....I got lucky that one of the cheaper ones actually had the best service...she came over to my house and set up my terminal and spent time with me going over everything....

using credit cards is going to cost you lots of $$.....make sure you add it to your bottom line....raise your prices by 3-4% to cover it

[Brian Altenhofel]

Just wanted to add that Pay Pal is a card processor that allows you to accept all major credit and debit cards. Not sure why people keep thinking that it's only for people who have Pay Pal accounts.

The fees for credit cards processed via PayPal are extremely high once you get to being a profitable business.


Really? Macy's, Walmart, Overstock, Best Buy and a crap load of other major online retailers use Pay Pal successfully with no problem.

Not as a credit card processor.

[Harold Mansfield]

The fees for credit cards processed via PayPal are extremely high once you get to being a profitable business.


Not as a credit card processor.

Yes as a credit card processor and I would argue that those are all profitable businesses. I just purchased from Best Buy online Friday with my card via Pay Pal. This is what I mean, people keep trying to make these alternative arguments against Pay Pal as if it's illegitimate for a "real" business.

I'm not saying you have to use it, but I just don't get the stigma that some people try to put on Pay Pal.

If you're an online retailer it's a great, reliable solution. And as an online retailer, it's worth paying a little extra to have a processor that people recognize and trust. IMO, Pay Pal, Google Checkout, and Amazon fit that bill. I've also worked with 2CO and Authorize.net. But they aren't as recognized nor is the service as good.

Granted if you are doing $10k+ a day and your margins are slim, and overhead high, an extra 1% may be problematic. However, you need to weigh that against how many sales you may loose or are losing because people are backing out because they aren't confident in your security or who you have processing cards. I know I don't just drop my card anywhere and I shop online a lot.

It's not an easy thing to decide and you have to take a lot into consideration. My only argument is that as an online retailer Pay Pal is reliable. And they already have solutions like "Bill Me Later" and mobile checkout in place that work well.

[Freelancier]

Google Checkout for non-mobile apps is gone now. They tried to transition everyone to Braintree... which then got snatched up by PayPal.

[Pronity]

No one has mentioned Stripe. I always recommend Stripe to my customers. Same pricing as PayPal + automatic withdraw to your bank account.

[Options]

Breadcrumb is really good. They have great rates and choices for your business type. If you want more information, feel free to write and I will put you in contact with someone that can give you information and the best rates!

[Brian Altenhofel]

Yes as a credit card processor and I would argue that those are all profitable businesses. I just purchased from Best Buy online Friday with my card via Pay Pal.

Offering PayPal as an option and using PayPal as a credit card processor are two completely different concepts. The former (which is what you described) leaves it up to the buyer how they fund a PayPal transaction. "Pay with PayPal" has a different fee structure that PayPal credit card processing.

In the end, it doesn't really matter to users who is processing credit card transactions. The users that think they care are an extremely insignificant minority that has a much more negligible impact on the bottom line than the difference between a provider with so-so generic service with a >2% fee schedule and a provider with industry-tailored service with a fee schedule that is potentially less than 1%.

[Brian Altenhofel]

No one has mentioned Stripe. I always recommend Stripe to my customers. Same pricing as PayPal + automatic withdraw to your bank account.

I like Stripe when the business is in an industry covered by their rather-restrictive terms. It takes a lot of the PCI-DSS burden off of the business because their website never handles credit card data or PII if setup correctly and still remains transparent to the user. In my experience based on data from clients' websites, off-site redirects for payment likely result in a higher cart abandonment rate.

[Harold Mansfield]

Offering PayPal as an option and using PayPal as a credit card processor are two completely different concepts.

It's the same service. One code. You can either pay with a card or our of your Pay Pal account if you have one. I've never seen anyone just offer one or the other.

[Freelancier]

You can either pay with a card or our of your Pay Pal account if you have one. I've never seen anyone just offer one or the other.

I think he's trying to say that you're making assumptions about what happens after the CC form is filled out. It could very well be PP processing it... or it could be a less-expensive alternative.

[Pronity]

I like Stripe when the business is in an industry covered by their rather-restrictive terms. It takes a lot of the PCI-DSS burden off of the business because their website never handles credit card data or PII if setup correctly and still remains transparent to the user. In my experience based on data from clients' websites, off-site redirects for payment likely result in a higher cart abandonment rate.

You can actually embed Stripe into your website so that your clients never have to leave your site.

[Brian Altenhofel]

You can actually embed Stripe into your website so that your clients never have to leave your site.

Yep, that's what I said. :) I just expanded a bit more into why it's a "best of both worlds" solution to use Stripe if possible and if the cost of PCI compliance exceeds the difference between Stripe's rate and other providers' rates.

[ryantc]

There are a lot of options to choose from. Square, Intuit GoPayment, PayPal, etc. Best thing is to research their offers and see which one fits best regarding your needs and the needs of your business.