Explained Simply: What is a Merchant Services Provider?

Your Merchant Services Provider is a vital partner that can help you operate and grow your business. They facilitate credit card processing and provide other important services for your business. Essential services offered by a merchant services provider include:

Accepting payments from your customers via credit, debit, and electronic payments allowing for seamless transactions.

Securely managing PCI compliance when processing and storing payment information for your business, making your customer data safe.

Providing your business with technology to track payments, understand business data, and collect outstanding invoices.

Let’s get back to basics to understand the definition of a merchant.

In This Article

TL;DR

  • Merchant services companies provide businesses and individuals with the tools and requirements to accept credit cards, debit cards, and other forms of electronic payment for transactions to take place. 
  • The products that merchant service providers offer to businesses in order for them to actually be able to accept and process payments in a way that works for them and their customers.
  • A Merchant Services Provider grants you the technology and information your business needs to optimize operations. You can learn a lot about your business from the payment data provided to you by your Merchant Services Provider. 

What Is a Merchant?

“Merchant” is a term used by payment processors to refer to their customers. Customers, or merchants, are businesses that accept credit card payments from their clients in-person, online, or over the phone. A Merchant Services Provider offers products and systems to help those businesses run smoothly.

These products and services often integrate with the business tools you already have. For instance, your payment provider may connect to a POS system for your retail store or to your QuickBooks Online for reconciliation. Merchant Service Providers can also provide customer management, inventory systems, and payment reporting.

Who Is Considered a Merchant?

A merchant represents a person or company that sells goods or services. Merchants can sell items in-person or online (sometimes called an eCommerce merchant). Most merchants today operate both in-store and online.

Different Types of Merchants:

  • eCommerce Merchant: A merchant who sells items online.
  • Retail Merchant: A merchant who sells items that they purchase from manufacturers.
  • Wholesale Merchant: Merchants/manufacturers who sell items to retail merchants. 
  • Affiliate Merchant: Merchants who use affiliate networks to sell goods.
  • Direct-to-consumer (DTC) Merchant: Merchants who sell items to consumers that they themselves create.

DTC merchants have become quite common in recent years, as selling goods on the internet has a very low barrier to entry. Most DTC companies are still wholesale merchants, selling their items to retailers who then sell the item to the consumer. 

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What Is a Merchant Account?

A merchant account is a bank account specifically established for business purposes where companies can make and accept payments. Note that a merchant account isn’t the typical bank account. This is a basic assumption that poses a lack of clarity for most business owners. Merchant services accounts allow businesses to accept credit and debit card transactions or other forms of electronic payment from customers, with the aid of a payment gateway.

Merchant account services often come with added fees, but also an array of services. Most often the merchant has to cover the transaction fees from payment processors, the credit card association, and the issuing bank for the merchant account. To that effect, it’s perhaps savvier for the merchant to look out for an option that’ll help cut down the cost per transaction.

On the other hand, a low processing fee doesn’t guarantee reliable service and support in the long run.

Merchant Account Provider vs. Merchant Services Provider

While the two entities overlap quite a bit, there are some distinctions between merchant services and merchant account providers.

The former is a much broader term that’s used to describe an organization that has various offerings for merchants—including payments, technology integrations, businesses services, etc.

Merchant account providers typically stick to helping businesses set up their merchant account—i.e., the type of bank account that enables you to accept credit and debit card payments.

In many cases, these terms are used interchangeably.

How Does Merchant Services Work?

Merchant services companies provide businesses and individuals with the tools and requirements to accept credit cards, debit cards, and other forms of electronic payment for transactions to take place.

There are thousands of merchant service providers in the U.S alone. From ISOs and third-party merchant services providers like Square, Stripe, Paypal, and Stax to big bank-operated merchant services (Bank of America, Wells Fargo, Chase Bank) each company offers its own tools, services, and fees. Depending on the size of your business, one model will be more expensive than another.

How Easy Is It To Open a Merchant Services Account?

A merchant services account establishes a business relationship between a merchant services provider and a business. Doing so provides the business with the ability to accept debit and credit cards, contactless payments such as Apple Pay, eCommerce transactions, and more. Some payment processing companies like Square don’t require a merchant services account in order to do business with them.

Not having a merchant services account can be a risky choice. Payment processing providers such as Square often accept higher-risk business clients that wouldn’t normally qualify for a merchant account. That increases the risk for the payment processor. If your business falls into that category, you’re more likely to experience an account hold for certain transactions. If the payment processor decides to no longer assume that higher risk, they can simply cancel your account leaving you unable to accept payments from customers.

Merchant Services Products

The next essential part of what makes up “merchant services,” is the different tools available for payment processing. The products that merchant service providers offer to businesses in order for them to actually be able to accept and process payments in a way that works for them and their customers.

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What are the Contactless Payments

Contactless payments include credit and debit cards, Apple Pay, Android Pay, Google Pay, Fitbit Pay, and other devices that use near field communication (NFC) or radio-frequency identification (RFID).

Pay on-the-go with Mobile Payments

Mobile payments are payments made for a product or service through a portable electronic device such as a tablet or cell phone. Mobile payment technology can also be used to send money to friends or family members with applications such as PayPal and Venmo.

Swipe, Dip, and Tap: Credit Card Terminals

A Credit Card Terminal also called an Electronic Data Capture Terminal or EDC Terminal is an electronic device that enables merchants to accept credit cards allowing customers to swipe, dip, or tap their credit or debit card to make a payment.

Online Shopping Made Easy: eCommerce Solutions

eCommerce is the activity of electronically buying or selling products on online services or over the Internet. From accepting credit cards and debit cards online to set up your customized web store, eCommerce solutions can bridge the gap when in-person payments are not an option.

Boost Sales with Virtual Terminals

A virtual terminal is a software application for merchants that allows them to accept payment with a payment card, specifically a credit card, without requiring the physical presence of the card.

Upgrade Your Business with POS Systems

A point of sale system, or POS, is the place where your customer makes a payment for products or services at your store. Simply put, every time a customer makes a purchase at your store, they’re completing a point of sale transaction.

Secure Payment Gateway

A payment gateway is a piece of software that works with your website or eCommerce store and allows you to take and process secure credit card payments online. The payment gateway serves in the place of a credit card terminal.

Secure Payment Processing with Merchant Services Provider

A Merchant Services Provider functions as the intermediary between banks, your business, and your customers. This allows you to confidently accept your customers’ preferred form of payment. With a Merchant Services Provider, you can depend on this payment arriving securely in your bank account.

When a customer swipes a card, the Merchant Services Provider moves the customer’s funds to your bank account. The funds will typically appear in your bank account within 48 hours. Many businesses do qualify for next-day funding and can get paid even faster.

Your Merchant Services Provider is where you will purchase or rent credit card terminals and mobile swipers. If you have an online business, they will seamlessly integrate with your eCommerce store. Virtual terminals let you accept payments online or key in payments over the phone. Your Merchant Services Provider will help you find the right payment processing services for your business.

Secure Payment Merchant Services Provider | Nfc Security

Secure Payments: Prioritize Payment Security

Payment Security is vital for businesses processing credit card transactions, online payments, and maintaining card number storage. There can potentially be a lot of risks involved when accepting payments today. According to one Nilson report, 2021 card fraud losses in the U.S. totaled $11.91 billion, an 18% increase over $10.09 billion in 2020. Through Payment Security, a Merchant Service Provider can help you and your clients conduct business transactions safely and securely.

Your Merchant Services Provider can help you ensure PCI compliance. This means that cardholder data stored by your business, including names and card numbers, is secure. Businesses can be proactive in protecting data by using strong passwords and updating their antivirus software regularly.

Meanwhile, your Merchant Services Provider will maintain PCI compliance on the payment end of your business. This includes tokenizing payment information and protecting your business by putting fraud prevention measures in place. Learn more about how Stax protects your payments.

Technology Provider

A Merchant Services Provider grants you the technology and information your business needs to optimize operations. You can learn a lot about your business from the payment data provided to you by your Merchant Services Provider.

  • Which customers are spending the most time and money with you?
  • What times of day, month, or year are you collecting the most payments?
  • Are there products or services on which you could increase your revenue?

Important Questions to Ask Your Merchant Services Provider:

  • How are your equipment costs structured?
  • What are your processing costs?
  • Are there any other costs or fees?
  • What kind of contract is required?
  • What kind of reporting and statements are offered?
  • Is all of your equipment PCI DSS compliant?

Which Merchant Service Is Best?

Every cent counts towards improving your business operations. This is why finding the best merchant service provider is so important. If you need to grow your business and serve your target market, then you need to have proper merchant services in place. There are over 1000 payment processing companies in the U.S. Here are a few things to consider while choosing payment processing platforms for your business.

With all the changes occurring in the economy, it’s imperative to provide a myriad of payment options to your customers. Payment processing solutions such as mobile payments, virtual terminals, and touch-free or contactless payment solutions expand revenue generation opportunities and give your customers a more seamless experience.

In some cases, it also makes sense to partner with a company that offers payment services beyond credit cards. Payments types like ACH and Text2Pay are quickly gaining steam, so it makes sense to use a provider that supports these modes of payment.

What Should You Look for in a Merchant Services Provider?

While looking for a merchant services provider, make sure to take note of their costs. Depending upon the kind of solutions you need, you will most likely have to keep the following charges in mind.

  • Setup Fee
  • Equipment Fee
  • Monthly Fee/Service Fee
  • Transaction Fee
  • Credit Card Processor Fee

Payment Processing Pricing

Flat Rate: Suitable for small retail businesses and startups with a low sales volume, the flat rate is a fixed percentage that’s based on a charge when processing payments. This pricing model is quick and easy to set up and has the best ease of use

Interchange-Plus Pricing: Each credit card issuer such as Mastercard and Visa has specific interchange rates for each card type whether it be CNP or Card present transactions. With the interchange-plus pricing structure, the processor adds a markup to the interchange and takes a cut out of each sale.

Direct Interchange: A direct interchange fee is one where the merchant charges a one-off monthly fee without any percentage rate. It’s not the best for small businesses that generate low volumes of sales.

Tiered Rates: Tiered rates are grouped in different structures that separate each card type(Visa, Mastercard, Discover). It’s not the most convenient for small to medium-sized businesses. Since the fees fluctuate this is not an ideal option for B2C transactions.

Additional Fees to Watch Out For:

  • Account fees
  • Minimum processing fee
  • Statement fee
  • Account setup fee
  • Cancellation fee
  • Chargeback fees
  • NSF fee
  • Early Termination fee

Don’t Forget About Customer Support

Be sure to vet the customer support offerings of a merchant services provider. Payment processing has several moving parts, and tech issues may arise. In these instances, you want a knowledgeable partner who has your back and can ensure that everything runs smoothly.

When selecting a provider, look into their customer service capabilities. Is support available 24/7? What platforms or channels can you use to access the info you need? What are other merchants saying?

The answers to these questions will help you gauge a provider’s reliability when it comes to customer support.

Final Words

Ranked one of the best merchant services companies of 2023, Stax has disrupted the payments industry with our subscription-based pricing model. Stax is a subscription-based merchant service provider with total transparency built into its model. All merchants have access to direct cost payment processing with 0% markups, no contracts, and no hidden fees.

We believe that all of this useful data should be placed in the hands of business owners like you. You can increase your knowledge and make strategic decisions that will positively impact your business. That’s why we built Stax, our all-in-one payment platform. With Stax, you can track payments, create payment links, and collect invoices in one place. Plus, you can also view detailed reports about the state of your business at any time.

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Quick FAQs about Merchant Services Provider

Q: What are the essential services provided by a Merchant Services Provider?

  • Accepting credit, debit, and electronic payments
  • Securely managing PCI compliance
  • Providing technology for payment tracking, business data interpretation, and invoice collection

Q: What is a Merchant Account?

A merchant account is a specialized bank account created for business purposes, allowing companies to make and accept electronic payments, including credit and debit card transactions, with the assistance of a payment gateway.

Q: What’s the difference between a Merchant Account Provider and a Merchant Services Provider?

Merchant Account Provider solely helps businesses set up their merchant account, while a Merchant Services Provider offers a broader range of services, including payments, technology integrations, and business services.

Q: How do Merchant Services work?

Merchant Services Providers supply businesses and individuals with the tools and requirements necessary to accept credit cards, debit cards, and other electronic payment forms for transactions to occur.

Q: What types of payment processing products do Merchant Services Providers offer?

  • Contactless Payments (NFC/RFID)
  • Mobile Payments
  • Credit Card Terminals
  • eCommerce Solutions
  • Virtual Terminals
  • POS Systems
  • Payment Gateway

Q: How do Merchant Services Providers ensure payment security?

Merchant Services Providers use measures such as PCI compliance, tokenizing payment information, and fraud prevention to create a secure payment environment.

Q: How can a Merchant Services Provider help optimize business operations?

By providing valuable payment data insights, Merchant Services Providers can help businesses understand customer spending habits, peak payment periods, and potential areas of revenue growth.

Q: What should a business consider when choosing a Merchant Services Provider?

  • Costs (setup fee, equipment fee, monthly fee, transaction fee, processor fee)
  • Support for various payment types (credit cards, ACH, Text2Pay)
  • Customer support availability and quality
  • Payment processing pricing models (Flat Rate, Interchange-Plus, Direct Interchange, Tiered Rates)
  • Additional fees (account fees, minimum processing fees, statement fees, contract cancellation fees, etc.)

How to Get a Credit Card Machine for Small Business

Are you looking to accept credit or debit card payments for your business? While the process may appear difficult, small business credit card processing is easier than it sounds.

Credit card usage has been on the rise, and this trend isn’t showing signs of slowing down. As of 2020, 79% of American consumers had at least one credit card or charge card, and experts are expecting that number to continue to grow.

Needless to say, small business owners that don’t accept credit cards are leaving a lot of money on the table. If you want to keep up with modern consumers, you need to ensure that you have the systems in place to accommodate their payment needs.

Doing that starts with evaluating different credit card processing services and selecting the right solution for your business.

Credit Card Payments and Your Business

One of the first steps to getting started with credit card processing for businesses is determining your specific needs. Ironing out your requirements will make it easy to evaluate credit card processing companies and figure out the best option for your business.

To that end, below are some helpful questions that can surface your business needs.

What Types of Credit Card Brands Do You Want to Accept?

Understanding what debit card and credit card brands to accept is very important for your business and customers. Credit cards contain their own unique set of rates and interchange fees which can be costly. As a business owner, you pay for the convenience of accepting a chosen payment method in order to accommodate the interests of your customers. Visa and Mastercard are standard, but then you also have American Express and Discover.

It’s important to note that each of these card networks have varying processing fees and policies, so be sure to consider them when deciding on the credit card types to accept.

How Will You Accept Payments?

List the methods you’ll use to accept card payments. Are you accepting in-person payments or online? Will you be accepting mobile payments or contactless payments like Apple Pay? Do you plan to take credit card payment info over the phone? What about online payments?

The answers to these questions will enable you to figure out what hardware and software you need to effectively set up and take credit card payments. For example, if you’re a large retail business that focuses on in-store transactions, then having a robust pos system that integrates with your credit card processor and credit card machines is a must.

If you’re selling online, see to it that your payment processor integrates with your e-commerce shopping cart.

There are many credit card processing solutions you can choose from. Depending on the industry, some payment types will serve as a default with additional options to expand payment collection methods from customers. Customers can make payments on your website or through a POS terminal next to the cash register.

You can process payments on your smartphone with a mobile card reader or you can type payments into a virtual terminal. Payment preferences are continuously changing so it’s important to know how customers want to pay as well as how your business wants to charge.

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How Much Sales Volume Do You Expect to Be Credit Card Transactions?

The number and amount you process are major factors that credit card processing companies consider when setting your rates. As such, you should understand your transaction volume before hunting for a merchant account service.

Step 1: Choose the Right Payment Gateway

The first step to small business credit card processing is setting up a payment gateway account— which is different from a merchant account provider. All your transactions, no matter what type, are channeled through a payment gateway. The payment gateway’s role is simply to decline or approve a transaction. Here’s a look at how payment gateways work:

  • The customer goes through the checkout process and pays for a good or service with their credit card.
  • Next, the authorization needs to be checked. The payment gateway service sends the transaction data to the merchant bank’s processor, who then routes the transaction data to the cardholder’s bank account.
  • The transaction now needs to be verified. The cardholder’s bank will either approve or decline the transaction. Then it will pass that information back to the credit card processors. The processor then passes the information to the cardholder and the merchant.
  • For a card that was accepted, goods or services are delivered. The transaction is completed.
  • The customer’s bank sends the required funds to the credit card processor. The processor forwards the funds to the merchant’s bank. Once you research the different payment gateway options available to you, contact the one that’s right for your business to get started. Be sure to look for the following features when choosing a gateway account for your business.
  • PCI DSS compliant
  • SSL (Secure Socket Layer)
  • eCommerce integration
  • Report generation
  • Customer support

Step 2: Set Up Your Merchant Account

The second step to processing and card machines for small business is choosing a merchant account provider (your payment processor). This involves thorough research into the best credit card processor for your business. Be sure to review not only the credit card processing fees from the payment processor, but also the overall pricing structure.

Some gateway service providers also include merchant services, but you should shop around before settling on that option. You should also note that some payment processors actually have gateway services of their own or have partnerships. It is important to find the right credit card processor for your transaction needs.

You want to find a payment processor that has all the credit card processing solutions you need to make transactions, and you want the best rates for their services.

How To Get A Credit Card Machine For Small Business | Person Using Pos System

Keep These Key Features in Mind When Choosing a Payment Processing Company

Not all payment processors are created equal. To figure out the right payment processing solution for your small business, be sure to take the following factors and features into consideration when researching a credit card processing company.

  • Digital application and rapid setup time. You operate in a fast-paced environment, so it’s important to partner with a payment processor that makes account and equipment setup quick and easy.
  • Favorable pricing structure and low transaction fees. Ask about the pricing model of your payment processor. How much is their markup? What processing fees do they charge? Ideally, your processor should offer transparent pricing and clear details about their rates. Or better yet, choose a payment processing provider that doesn’t take a cut out of your sales. At Stax, you are charged a flat monthly fee for unlimited access to the direct cost of interchange rates.
  • No ancillary or hidden fees (see below). Stay away from providers that tack on additional processing fees beyond credit card processing.
  • Fraud protection. You want a provider that looks out for you and helps prevent fraudulent transactions from taking place.
  • Supports the payment processing solutions you need.  Depending on your business, this may include integration with your POS system, EMV-compliant equipment, support for your shopping cart, POS terminal, virtual terminal, mobile card reader, etc.

Processing Fees You Should Avoid

  • Termination fees
  • Customer service fees
  • Statement processing fees
  • IRS fees
  • Batch processing fees
  • Annual processing fees
  • Contract fees
  • PCI compliance fees

Step 3: Accept Credit Card Payments

Once your merchant account is set up, you’re ready to accept credit card payments. This can be as simple as logging into a software product or entering your customer’s payment information.

In some cases, you’ll need to set up your equipment (i.e., POS system, credit card readers, etc.) Whatever credit card payments solution you choose for your business, it should be simple and easy to use.

If you don’t like the payment processor or the services you’re receiving after a few months, it should be easy to switch payment processors— unless you signed into a contract. Many contracts will have a hefty termination fee you have to pay in order to cancel. Try to get the fee waived or simply choose a credit card processor that doesn’t have contracts.

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FAQs About Getting A Credit Card Machine

Q: What is a credit card machine, and why do I need one for my small business?

A credit card machine, also known as a point-of-sale (POS) terminal, is a device that allows your small business to accept credit and debit card payments from customers. It is essential for modern businesses as it enables easy and secure transactions, expanding your customer base and increasing sales.

Q: How can I get a credit card machine for my small business through Stax Payments?

Getting a credit card machine through Stax Payments is simple. You can visit our website and request a call from our team once you provide some basic information about your business. Once registered, you can browse through our range of credit card machines and choose the one that best suits your business needs. Our team will guide you through the application process and provide assistance every step of the way.

Q: What types of credit card machines are available for small businesses at Stax Payments?

Stax Payments offers a variety of credit card machines to cater to diverse business needs. Our selection includes traditional countertop terminals, wireless terminals for mobility, virtual terminals for online transactions, and mobile card readers for on-the-go businesses.

Q: How secure are the credit card machines offered by Stax Payments?

Security is a top priority for Stax Payments. Our credit card machines are equipped with the latest encryption and compliance measures to protect your customers’ sensitive data. Rest assured that your transactions are safe and compliant with industry standards.


Ready to Set Up Credit Card Processing for Your Small Business?

If you’re looking for the perfect payment processing solutions for your small business, you’ve come to the right place. Stax Pay offers subscription-based integrated payment processing services at a direct cost— without any markups, ancillary fees, or contracts.

eCheck vs ACH: What are Their Similarities and Differences

When transferring from bank to bank, eChecks and ACH transactions are extremely common. Consumers, small businesses, and large companies alike all send or receive payments in these forms. For those who aren’t entrenched in the payment space, the differences between these two are negligible, and the terms are used interchangeably.

But as transaction volumes and the regularity of these payments increase, it becomes extremely important that business owners learn the differences between these modes of payment.

The process of the ACH and eChecks may be similar, but there are some key distinctions between the two. With B2B ACH payments growing in value from 4.42 billion in 2020 to 5.32 billion in 2021, it’s important to better understand these payment methods and which offers the best financial outcomes.

TL;DR: eCheck vs ACH

Don’t have a lot of time? Here’s a side-by-side comparison of eChecks and ACH:

eCheck ACH
Frequency One-time payments May be recurring
Processing Time 1-3 business days, but could potentially take longer when verifying one-off transactions 1-3 business days
Fees / Cost Varies, but typically $0.30 to $1.50 per transaction Varies, but typically between 1.4-3.5%
How Payments Are Carried Out Through the ACH network Through the ACH network

 

What’s an eCheck and What’s an ACH Payment?

ACH (automated clearing house) payments have been around since the late 60s. Paper checks were on the rise, and bankers worried that the technology at the time could not keep up with processing volumes. Wise heads came together, and the ACH network was developed to process the traditional paper check.

Through ACH processing, merchants could accept the paper check using the routing and account number of the customer’s bank account as well as authorization from the customer.

ACH payments allowed consumers or businesses to take payments directly from the payers’ bank account upon receipt of their checks.

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Translation: Check payments were essentially a form of ACH payment processing. Once received, the payment went through the automated clearing house. The same is true with the eCheck.

Electronic checks (eChecks) work a lot like a traditional check. They are, in fact, the digital solution to the paper model.

Today, check or no check, ACH payments enable bank-to-bank payment processing. ACH is the process, and the check or eCheck is the payment method.

Tip: If that’s a bit of a head-scratcher, it may help to think of it another way: All online transactions are electronic payments, but the payment methods can change. PayPal, credit card, debit card, and bank transfers are all electronic payments. They’re just different payment methods.

Checks and eChecks are under the ACH umbrella, handled through the ACH process. There are just a few ways ACH payments can be made. Checks and eChecks are but one.

Differences: Electronic checks and ACH payments

Although eChecks are processed as ACH payments, there are still differences that merchants should be aware of.

How they work

We have a reasonable understanding now of how eChecks are processed. The payer submits an eCheck, which is, in effect, details for a one-time transfer from their everyday bank or checking account to the payees. Those details include the routing number, bank account number, and authorization to process the eCheck. Once received by the payee (the merchant), it is processed through the ACH network.

So how do check-free ACH payments compare?

ACH payments are electronic transfers that use bank routing numbers and bank account information to transfer payments between two (or more) banking institutions. On average, it takes one to three business days for ACH transactions to be processed. While that doesn’t sound ideal, ACH payments are favored for their lower costs when compared to wire transfers or debit cards.

Unlike eChecks, which are one-off payments, ACH payments are commonly used for recurring payments, direct deposits, and large transactions. The bank information provided for ACH payments is stored for future online payments. eChecks are once-offs. The process is the same, but the payment information is not stored.

Here’s an example. Let’s say you run an accounting firm and want to lower your payment processing fees by accepting ACH and eCheck payments. You can implement either or both, depending on the service.

If you offer ongoing bookkeeping services, you can bill your clients every month by asking for their banking information and having it on file. On the other hand, if you offer one-off services like IRS audit assistance, then you can bill clients via eCheck. In this case, you can ask your clients to initiate a one-off eCheck transaction online instead of writing you a paper check.

Who’s involved in these EFTs?

Both eChecks and ACH fall under the term EFTs (electronic funds transfers). In both cases, funds are being transferred electronically from one party to the other.

The payment parties are the same for both payment options. The financial institutions communicate to confirm the bank accounts and authorization to process the ACH debit or ACH credit.

ACH debit: when the merchant is withdrawing funds from the other party’s account. (E.g., for a recurring subscription payment.

ACH credit: when the merchant is paying funds to the other party’s account. (E.g., paying salaries to staff.)

Again, the main difference is that ACH payments specifically will store the payment information for future debits.

Processing times

Once authorized, ACH processing and eCheck processing take the same time: one to three business days. But there is an extra step for eChecks that make them a little slower.

As eChecks are one-off payments, steps need to be taken to verify and authorize the payment. The merchant account needs the green light to process the eCheck through the ACH network. While it’s all done automatically, once the eCheck is submitted, it can take an extra 24-48 hours. eChecks then can take two to five days to process.

Processing fees

Different payment processing providers have different processing fees, so giving definitive values is difficult. However, it is common for eChecks to attract an additional processing fee as there are extra steps in the check processing — verification. eChecks that bounce can also attract extra fees.

There can be ACH return fees and reversal or chargeback fees in both cases. These can be different depending on the merchant services account.

Similarities: ACH vs. eChecks

As we have highlighted the differences, the similarities will have become evident on their own. ACH payments and eChecks are both processed through the ACH network. They both work with electronic funds transfers to move funds from one financial institution to another. They are both bank to bank, rather than traditional payment processing, which may be a credit card payment going to a merchant account.

How to implement ACH and eCheck payments

ACH payments (eChecks included) should be considered essential to accept. Processing fees are low, security is high, and customers greatly appreciate the convenience. Transfers coming straight from customers’ accounts, rather than their card, let them avoid certain fees, and the same benefits go for merchants.

Implementing these payment solutions is simple. Through the right payment processor, merchants can set up an ACH payment gateway that facilitates the ACH payment process. With this setup, merchants can simply request customers’ authorization to use this payment method. Payment details are then set up, and the payment information is submitted.

Stax makes it simple

Businesses rarely have just one type of payment processing need. Whether in-store, online, or strictly B2B services, a diversity of payment options is a must.

Stax Pay processes payments of all types. We help businesses with eCheck processing, ACH payments, credit card payments, digital payments, and all other transaction types. And we do this with transparent pricing, no hidden monthly fees.

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FAQs about eChecks and ACH Transactions

Q: What are eChecks and ACH transactions?

eChecks and ACH (Automated Clearing House) payments are standard methods of transfer between banks. An eCheck works much like a traditional check but in a digital form. ACH payments, however, can be made with or without a check and involve processing through the ACH network using the customer’s bank account details.

Q: How are eChecks and ACH payments similar?

Both eChecks and ACH payments are processed through the ACH network, involve electronic funds transfers, and move funds from one bank account to another. They cut out traditional payment processing methods like credit cards, reducing associated costs.

Q: What distinguishes eChecks from ACH payments?

The major difference lies in their usage and data storage. eChecks function as one-off payments, and the banking information isn’t stored post-transaction. ACH payments, on the other hand, can be recurring, involving the storage of payment information for future deductions.

Q: How do eChecks and ACH payments work?

eChecks involve a one-time transfer from the payer’s bank account to the payee’s, with the transfer’s details, including the bank routing number, account number, and authorization to process the eCheck. ACH payments use bank routing numbers and account information to facilitate transfers between banking institutions, taking one to three business days to process.

Q: What is the processing time for eChecks and ACH payments?

Generally, ACH processing and eCheck processing have the same time duration: one to three business days. However, since eChecks require additional steps for verification, they might take between two to five days.

Q: Are there any additional costs when using eChecks or ACH payments?

The processing fees for both can vary, and eChecks might attract an added fee due to the extra steps required for check processing. Also, factors like ACH return fees, reversal fees, or chargeback fees can influence the total cost.

Q: How can businesses implement eCheck and ACH payments?

Businesses can set up an ACH payment gateway through a suitable payment processor, such as Stax Pay. This enables them to request customer authorization and process various payments, including ACH payments, eCheck processing, credit card payments, and more.

Q: Who benefits from eCheck and ACH payments?

Both customers and merchants find it beneficial. Customers notably appreciate the convenience and potentially lower costs. For businesses, these efficient methods offer high security, reduced fees, and a range of options to fit varying service types and payment structures.


 

5 Benefits of ACH Payments Over Check Payments

ACH transfers, or payments made through the Automated Clearing House network, account for billions of dollars in payments annually. In fact, NACHA, the nonprofit that governs the ACH payments network reported 6.1% in payment volume growth in Q4 2021.

The average consumer commonly uses the ACH network for automated bill payments and larger transactions. However, the use of ACH payments in B2B transactions accounts for a large portion of payments made through the network and grew by 17.4% in Q4 2021.

Since many businesses collect payments from their customers and handle their own business expenses, ACH payments are already a substantial part of business operations

ACH payments use the same information as a paper check, but with additional benefits which have been diverting users away from traditional check writing. Here, we’ll discuss the main differences between ACH and check payments and the business benefits of accepting this form of payment.

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ACH Payment Versus Check Payments: What’s The Difference?

An ACH payment requires the same information that is on a check, including the name of bank, type of account (checking or savings), and the routing and account number. These transactions usually process within one to three business days and are most commonly used for payments such as direct deposits for payroll, recurring bill payments, and B2B invoice payments.

Simply put, check payments are the analog version of ACH transfers. Requiring all the same information, a check payment accomplishes the same goal but takes a lot more time–and introduces more variables.

For example, once the check is completed, it is put in the mail, sorted at the carrier facility, sent out for delivery–and once delivered, the recipient needs to go through the process of depositing the funds. Not only does this pass through more hands and take more time than an electronic ACH payment, but there is also a huge amount of personal information present on a paper check, exposing the payer to potential identity theft.

Benefits of Accepting ACH Payments

The ability of a business to accept an ACH payment can be advantageous. Not only is this payment type a secure and low-cost alternative to credit and debit card payments, it often processes more quickly. The following is a list of some compelling reasons businesses should consider accepting ACH payments.

Faster payment delivery

As mentioned above, paper check payments take a longer period to process. Not only does it take additional time for the business to get paid, funds are not quickly withdrawn from the customer account. This additional time for payment delivery can cause confusion and errors and ultimately can have negative impacts on the customer experience.

According to NACHA, most ACH transfers process the same or next-day. In 2020 there was an average of 1.4 million ACH payments, with a daily value of $1.8 million. It is clear the tide is already shifting away from check payments, and adding ACH transfers may be a mutually beneficial offering for both businesses and their customers.

Lower processing fees

Compared to other payment methods like credit and debit cards, an ACH payment is far less expensive. With an average cost per transaction of $.29, ACH payments are a cost-saving option for businesses of any size.

This also makes ACH payments ideal for high-value transactions. When you’re selling products or services that cost thousands of dollars, you end up paying hundreds of dollars in credit card fees. Using ACH payments reduces your processing costs to a fraction of what you’d typically pay when a client uses a credit card.

Automate recurring payments

ACH payments are well suited for recurring transactions and are often used in many industries. For example, a law firm typically bills clients multiple times either for installment payments or ongoing hourly charges. Since these transactions are usually recurring and on the larger side, ACH transfers are an easy way to simplify the bill pay process. Once the client sets up a payment profile with their banking information, the payment can be automated and paperless.

Implementing ACH payments processing in your business can reduce the human error component of manual bill pay and check writing, thus increasing the speed and consistency of getting your invoices paid and improving the client experience.

Safety and security for your customers

Virtually every person has personal information outside of their control; whether it is payment information saved on a rogue shopping profile or a data leak exposing sensitive personal data, consumers have valid reasons to be concerned about identity fraud. Beyond the inconvenience of mailing a paper check, there is an increased risk of identity theft.

A recent study by the Better Business Bureau states that fraud and identity theft rose by 45% from 2019 to 2020. While this increase includes many scenarios, it’s important to think about how much unnecessary exposure is created in using paper checks as payment. The same study indicates a 72% increase in account takeover since 2019. As such, eliminating the use of paper checks whenever possible is a prudent step in minimizing exposure of personal information.

Beyond being less convenient than other payment types, check payments are being actively discouraged by industry professionals. The Federal Trade Commission offers straightforward advice: “don’t give out your bank account number.” Because check payments include not only the bank account number but also name and address, this payment method is not a recommended option.

With an ACH payment, customers need only to enter their banking information once (versus sending multiple check payments) on a secure platform and they are then ready to safely and securely process one-time and recurring payments with businesses that accept ACH transfers.

Reduce fraud for your business

Businesses that use paper checks for B2B payments are also at risk for fraud. It is estimated that 75% of businesses have experienced check fraud. Paper checks are being ditched by businesses and consumers alike because they are simply inconvenient and lack the security assurance of a digital payment method.

ACH payments are consistently ranked as one of the safest payment methods a business can accept, and are regulated by the Federal Reserve Bank and Electronic Fund Transfer Act.

User-friendly and easy set up with ACH payments

Many customers may not know they frequently use ACH payments already in their daily lives. For any business looking to implement ACH transfers as an accepted form of payment, it’s important to communicate how easy it is to set up. Customers need to share their information once, and so long as they don’t change their bank account information, they’ll be set up indefinitely for any payments that need to be made.

How to Implement ACH Payments

For any business assessing which payment options they should accept, it’s important to consider which payments are a good fit for the company and the customer. Chances are, if your business accepts check payments, adding ACH payments is likely a good fit.

If ACH payments are a good fit for the business, the next step is to choose the right payment processor. Choosing a payment provider that can handle multiple payment types streamlines this process and provides valuable insight into the financial health of the company.

Stax’s all-in-one payment platform can facilitate ACH transfers to streamline your billing operations—while helping you be more cost-efficient. With transparent pricing and no contracts, Stax makes payment processing a breeze

Accepting ACH payments is just one of many ways Stax can help modernize and secure your business.

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Quick FAQs about ACH Payments vs. Check Payments

Q: What are ACH payments?

ACH payments, or payments made through the Automated Clearing House network, are electronic payments made directly between banks. They use the same information as a paper check and are commonly used for direct deposits, recurring bill payments, and B2B invoice payments.

Q: What is the difference between ACH payments and check payments?

ACH payments require the same information as checks, but they are processed electronically, usually within one to three business days. On the other hand, check payments are a manual process and take longer to process. A check also exposes the payer to potential identity theft as it contains a lot of personal information.

Q: What are the benefits of accepting ACH payments?

  • Faster payment delivery: ACH transfers process faster than paper check payments, providing businesses with quicker access to funds.
  • Lower processing fees: Compared to other payment methods like credit and debit cards, ACH payments are less expensive.
  • Automation of recurring payments: ACH payments are well-suited for recurring transactions, reducing the human error component of manual bill pay and check writing.
  • Safety and security for customers: ACH payments are a secure method of payment that minimizes exposure to personal information.
  • Reduced fraud for businesses: ACH payments are consistently ranked as one of the safest payment methods a business can accept.

Q: How can businesses implement ACH payments?

Businesses can implement ACH payments by choosing a payment provider that can handle multiple payment types, such as Stax’s all-in-one payment platform.

Q: Why are ACH payments considered more secure than check payments?

ACH payments are more secure than check payments as they are electronic and do not require physical handling, reducing the risk of a paper check getting lost or stolen. Furthermore, they minimize the exposure of personal information, helping to prevent identity theft.

Q: Can ACH payments be used for recurring transactions?

Yes, ACH payments are ideal for recurring transactions. Once a client sets up a payment profile with their banking information, the payment can be automated and paperless, making it a convenient and efficient method for both businesses and customers.

Q: What is the cost of an ACH transaction compared to a check payment?

The average cost per ACH transaction is $0.29, making it a cost-effective option for businesses. In contrast, the cost of a check payment can be significantly higher due to the cost of the physical check and the processing fees.

Q: How quickly do ACH payments process compared to check payments?

Most ACH transfers process the same or next day, whereas check payments can take several days to process due to the need for physical delivery and depositing of the funds.

Q: Why are ACH payments considered user-friendly?

ACH payments are considered user-friendly as customers only need to share their banking information once. Once set up, they are ready to safely and securely process one-time and recurring payments with businesses that accept ACH transfers.


 

The Best Mobile Credit Card Readers for Small Businesses

Going cashless is becoming the norm for consumers. People are not carrying cash like they used to. And the evolution of mobile credit card processing technology means consumers have more choices when it comes to how they pay. So what does that mean for small businesses, especially businesses on the go?

Mobile credit card readers are the perfect solution for on-the-go payments. You can accept both EMV and magstripe cards, while some readers also accept NFC apps like iOS’ Apple Pay for contactless payments. Whether you’re using a mobile card reader with your phone or a terminal, mobile readers for small businesses can streamline the entire payment process. Here are some factors to consider while looking for a mobile reader:

Is Your Point of Sale Mobile?

To utilize a mobile credit card reader, your POS system must be able to function on a mobile device. These days, there are many options for mobile POSs, but whether you’re completely functioning on iPads everywhere or a desktop POS in store and an android phone on the go, you’ll need a mobile device to use a mobile card reader. 

Can You Accept EMV and NFC?

A good mobile credit card reader should have the ability to accept both EMV chip cards and NFC credit card payments. This means in addition to a classic magstripe reader, the reader needs to have dip or tap functionality. Customers have more options when it comes to how they pay. Mobile payments like Google Pay, Samsung Pay, and Apple Pay have grown in popularity recently. 26% of people worldwide now use mobile wallet payments (in addition to using classic options like debit cards or magnetic stripe Visas, Mastercards, etc). Accepting payment besides cash increases your business’ cash flow. Mobile swipers like the Chipper 2X BT connect via Bluetooth, so you can accept and manage payments from a mobilen app. These readers are great if you often work outside of a typical brick-and-mortar store.

RELATED: An Ultimate Breakdown of Credit Card Readers

Are Mobile Credit Card Readers Reliable?

Mobile readers need to be secure and reliable. All businesses that handle cardholder data must be PCI compliant and your mobile payments need to be compliant as well. Non-compliance results in fines anywhere starting from $5,000 up to $100,000 a month. If you use a mobile payment app with your mobile credit card reader, it must be PCI compliant. Stax uses tokenization and encryption all the way to settlement. Whether you key-in information or use a card reader, your data is secure.

Can You Connect Over 5G and WiFi?

Poor connectivity and technical issues slow down check out and cause long lines. Connecting your reader multiple ways can be an insurance policy against those issues. The Dejavoo Z1 and Z9 are both wireless, so you can take them on the go and connect over WiFi or 5G to prevent long lines from forming. They’re a perfect payment processing solution for busy times of day at stores, or if you have a pop-up stand event.

Are There Extra Features Without Extra Costs?

Extra features on your mobile reader shouldn’t cost an arm and a leg while giving flexibility to how you do business. The Dejavoo Z1 reader can email customers their receipt, while the Dejavoo Z9 offers a built-in receipt printer. The Chipper mobile swipers connect via Bluetooth for mobile payments. A good mobile reader should offer useful features to make mobile payments easier.

Choosing the best mobile credit card readers for small businesses boils down to capabilities and functionality. Along with those features, your credit card processor must support mobile payments.

Some other considerations as you consider mobile card readers:

  • What transaction fees , processing fees, or monthly fees does the merchant services provider you’re looking at charge?
  • Does it work with Android devices or just Apple ones, like iPhone?
  • Does it integrate with your eCommerce software (like Shopify)?

Stax’s mobile payment processing solutions are fully integrated. Business owners can track, manage, and accept in-person and online payments from wherever you are. And as a Level 1 PCI compliant service provider, with the highest level of compliance available, you can be confident that your data is secure. Stax’ transparent pricing means you don’t pay extra to process payments—without a contract. And our unbeatable customer support will be there to ensure your success.

Also Check Out: Ways to Save on Credit Card Reader Machines

Ready to see what Stax mobile solutions can do for you? Contact us today.

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Square Card Reader Review: How It Works and What Merchants are Saying

Credit card processing is a necessary component of doing business, and finding a good merchant account provider with reasonable costs, accessibility, and support is crucial.

Having a cost-effective and reliable way to accept chip cards and contactless payments is essential given that 80% of shoppers use eWallets and credit cards as their preferred method of payment.

You need a secure way to get banking information from your customer’s credit or debit card to process payments, and credit card readers simplify that process. Your customer simply swipes or dips their card, and the device will extract the relevant banking information to be transmitted to your payment processor, and back to you to finish the sale.

There are multiple providers that offer card readers and other payment processing services, but this article will focus on Square — specifically the Square card reader.

You will discover how it works and the applicable Square card reader fees.

What is the Square Card Reader?

Square was the first payment processing company to introduce card readers that let cell phones accept card readers. It is for good reason that the company’s highly portable card readers are found at small businesses across the country.

The Square Reader for Magstripe is free and you can either use it with a headphone jack for Android or a Lightning connector for iPhone. When plugged into your phone, it connects with the Square Point of Sale (POS) app to start accepting swipe cards.

However, the Square Reader for Magstripe has limited protection from fraudulent swipe card purchases and it’s only suitable when you process payments sporadically.

You are better off with the Square Reader for Contactless and Chip. It is compatible with EMV-enabled cards, and accepts both chip cards and tap-to-pay cards with an embedded NFC chip. NFC support includes Apple Pay, Google Pay, Samsung Pay, and others.

The Square Reader for Contactless and Chip is competitively priced at just $49, and the company offers a 30-day money-back guarantee on all hardware purchases.

It is a pretty versatile card reader. Not only does it support NFC cards, there is also a slot for chip and PIN cards to be inserted for physical transactions. You can either use it as a stand-alone mobile processing device or as an extension of your iPad Square Stand.

A key limitation of the Square Reader for Contactless and Chip is that it does not support magstripe credit card payments. This is not a big issue since EMV chip cards are now the standard method of accepting credit and debit card payments across the country.  If you really need a magstripe card to take payments, you can get the Square Reader for Magstripe for free.

Square Card Reader Fees

Square uses a flat-rate pricing structure where you pay a set percentage plus a few cents for each transaction, regardless of the type of credit card used. Rates will vary depending on whether it is an in-person transaction or a keyed-in transaction. In-person transactions have much lower fees than keyed-in transactions.

Your transaction costs will really be determined by the type of Square POS app you are using:

  • Square POS: 2.6% + $0.10 per swipe, dip, or tap
  • Square for Restaurants: 6% + $0.10 per swipe, dip or tap
  • Square for Retail: 2.6% + $0.10 per swipe or dip, and tap (3.5% + $0.15 for keyed-in transactions)
  • Square Appointments For Teams: 2.5% + $0.10 per swipe, dip, or tap
  • Square Appointments for Individuals: 2.6% + $0.10 per swipe, dip, or tap (3.5% + $0.15 for keyed-in or Card on File transactions)

Square’s rates are comparable to that of other payment processors including PayPal and Stripe, but businesses with a high volume of transactions prefer a payment processor that offers a lower interchange-plus pricing and lower credit card processing fees. Also, Square doesn’t offer discounts for high-volume businesses except they have annual sales of $250,000 or more and average transactions over $15.

The company doesn’t have any chargeback fees, and rates are low enough to make it very attractive for low-volume and new businesses.

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How to Get a Square Card Reader

The straightforward way to get your Square reader is to order it from the company’s website. Follow the few steps below and you get your card reader delivered to your doorstep within five to seven days:

Step 1: Create your Square account. Hit the get started button on the company’s website, add your email, password, and follow the prompts to agree to the e-sign consent form and privacy policy.

Step 2: Answer questions about your business. Here, Square will ask a few questions about the nature of your business (brick-and-mortar, online, etc.), and how you plan to receive payments. They will also ask for your personal and business information including your Taxpayer Identification Number (TIN), bank account information, social security number, and more.

Step 3: Identity verification. The company will ask for your address to verify who you are. The verification process will only take a few seconds.

Step 4: Choose your Square Card Reader. Select from either the Square Reader for Contactless and Chip or the Square Reader for Magstripe. You must also choose either the headset jack (Android) or Lightning connector (iPhone). You can opt to wait for five business days to receive the devices, or if you can’t wait that long, get the card reader from large retailers like Amazon, Walmart, and Best Buy.

Step 5: Set up your credit card reader. Plug your card reader into your mobile device and open the Square POS app on your phone.

Go to the settings menu on the app, scroll to “Card Readers”, and press the “Connect a Card Reader” tab. The app will ask what kind of Square reader you are using, select the relevant reader, and follow the on-screen instructions to pair your reader to the app.

Press and hold the power button until you see the four lights flash orange to approve the pairing request. Then, follow the prompts on the screen of the card reader to approve the request.

After a successful pairing, the app will download all relevant updates, and notify you that the Square reader is ready for use.

You can now start collecting payments from customers.  You swipe the card straight through in a swift, smooth motion, and the reader will capture your customer’s information.

Square says the card reader is designed for all-day use, but some users have complained about the reader’s battery life, and you should consider buying a charging dock.

Also Check Out: The Best Mobile Credit Card Readers for Small Businesses

Using a Square Credit Card Reader in Your Store

Like we mentioned above, the Square Point of Sale app is crucial to unlocking your card reader. You can download it via the Apple (iOS) and Google app stores.

The app and the reader work well for most small businesses and the only notable issue is that the Square Reader for Contactless and Chip doesn’t work offline. To process offline payments, you will need the Square magstripe reader.

The Square card reader will work with all the other Square POS apps including Square for Retail, Square for Restaurants, and Square for Appointments.

The Square app offers numerous features including:

  • Product Library: add items, item categories, photos, prices, barcodes, and more to individual products.
  • Payment Methods: Square accepts Mastercard, Visa, American Express, and more. Apart from physical cards, you can also type in card details manually. You can send invoices and print receipts to be sent via email or text message.
  • Payment Protection: fraud protection services are built-in and all payment information is encrypted. The company also automatically takes care of PCI compliance requirements for you.
  • Offline Mode: the Square POS app works offline and transactions will be pending for 72 hours to ensure the payment will be processed as soon as you are online.
  • Reporting: the Square dashboard lets you view all transactions and payouts at a glance. You can generate reports and payment analytics on best-selling products, average customer spend, and more.

Customer Complaints

Many users are happy with Square’s card readers but they aren’t perfect, and here are some issues we have discovered:

Funding holds and terminated accounts. The bulk of customer complaints is about having their funds placed on hold suddenly or even having their accounts deactivated without any notice.  No one wants to have their cash tied up without notice or lose their accounts with little to no warning.

Faulty Bluetooth connection with mobile devices. Some customers reported problems with maintaining the Bluetooth connection between the card reader and their mobile device.

Flawed customer support. Square’s customer support can be difficult to reach to the frustration of many users. The company focuses on offering a good enough product at a low cost and this may explain the relatively poor quality of its customer service.

Should You Get the Square Card Reader?

Square’s card readers are excellent for new or micro-businesses that don’t process a lot of credit cards. They work seamlessly with its free POS app, and are available for free or at a relatively low price point. Also, the flat-rate pricing model for payment processing makes it an acceptable option for small businesses that process low volumes of transactions.

However, it is not the only processing option out there, and other merchant providers like Stax can offer you a more affordable service when you outgrow the relative advantages of Square’s pricing model.

Stax’s pricing model lets you pay a monthly fee to access wholesale interchange rates. Businesses that process large volumes of transactions will find the monthly subscription model attractive since it can provide lower per-transaction costs.

If you’d like to learn more about our payment processing solutions (including hardware like card readers) fill out the form below or contact the Stax team directly.

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FAQs about Square Card Reader

Q: What is the Square Card Reader?

The Square Card Reader is a device designed by Square, the payment processing company, to enable businesses to accept card payments. The company provides two types of card readers: The Square Reader for Magstripe and the Square Reader for Contactless and Chip. The former is suitable for businesses that sporadically process payments, while the latter accepts both chip cards and tap-to-pay cards with an embedded NFC chip, which includes Apple Pay, Google Pay, Samsung Pay, and others.

Q: How does the Square Card Reader work?

The Square Card Reader works by connecting it to your mobile device via a headphone jack for Android or a Lightning connector for iPhone. When connected, it interacts with the Square Point of Sale (POS) app to start accepting card payments. The customer simply swipes or dips their card, and the reader extracts the relevant banking information, which is then transmitted to your payment processor and back to you to complete the sale.

Q: What are the Square Card Reader fees?

Square uses a flat-rate pricing structure, where businesses pay a set percentage plus a few cents for each transaction, regardless of the type of credit card used. The rates vary depending on whether it’s an in-person transaction or a keyed-in transaction, and also the type of Square POS app you are using. For example, with the standard Square POS app, you pay 2.6% + $0.10 per swipe, dip, or tap.

Q: How can I get a Square Card Reader?

You can order a Square Card Reader directly from the company’s website. After creating your Square account and providing the necessary information about your business, you can select the type of reader you want, either the Square Reader for Contactless and Chip or the Square Reader for Magstripe. You can also choose either the headset jack (Android) or Lightning connector (iPhone).

Q: What are some common complaints about the Square Card Reader?

Some users have reported issues such as sudden fund holds or account deactivation, faulty Bluetooth connection, and inadequate customer support. However, it’s important to note that many users are satisfied with Square’s card readers and the issues reported do not represent the experience of all users.

Q: Is the Square Card Reader suitable for all businesses?

Square’s card readers are excellent for new or micro-businesses that don’t process a lot of credit cards. The flat-rate pricing model for payment processing makes it an acceptable option for small businesses that process low volumes of transactions. However, businesses with a high volume of transactions may prefer a payment processor that offers a lower interchange-plus pricing and lower credit card processing fees, such as Stax.

Q: Can I use the Square Card Reader offline?

The Square Reader for Contactless and Chip does not work offline. To process offline payments, you will need the Square Magstripe Reader, which works with the Square POS app offline and transactions will be pending for 72 hours to ensure the payment will be processed as soon as you are online.

Q: What features does the Square POS app offer?

The Square POS app offers features such as a product library to add items, payment methods including Mastercard, Visa, American Express, and more, payment protection with built-in fraud protection services, and reporting capabilities to view all transactions and payouts at a glance. It also provides payment analytics on best-selling products, average customer spend, and more.


 

Invoicing and Billing 101: How to Best Simplify

Invoicing and billing are cornerstone tasks for businesses. You need to have procedures that ensure that you’re paid for the products or services that you render to your customers.

But relying on paper records can make it difficult to facilitate these tasks. Paper documents and manual procedures make tracking outstanding payments cumbersome, which may result in payments slipping through the cracks.

Fortunately, there are several steps you can take to streamline your billing and invoicing processes. 

Invoice vs Bill

Before diving into billing and invoicing best practices, it’s worth understanding the difference between the two. While many people use the terms “billing” and “invoicing” interchangeably, they do have some key distinctions.

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What is invoicing?

Invoicing refers to the process of sending an invoice — which is a document itemizing the products or services sold by the business. It can come in the form of a paper document or a PDF, and it typically contains:

  • The date the invoice was sent
  • The date the products/services were delivered
  • The payment terms of the invoice
  • Payment instructions

What is a bill?

A bill is a document received by the customer, which also outlines the products or services rendered by the business. A key difference is that a bill usually implies the need for immediate payment, while an invoice can outline certain terms (i.e., net 30/60/90 days).

The difference is subtle, and often the distinction between invoicing and billing lies in how the documents are perceived. A merchant may send an invoice, which the customer then sees as a bill to be paid.

Regardless of these technicalities though, one thing remains the same: in order for your business to get paid quickly and easily, you need a streamlined billing and invoicing process.

Check out the billing and invoicing tips below to learn how to do just that.

Digitize Your Billing and Invoicing Documents

The first step to simplifying how you bill or invoice clients is to eliminate paper documents whenever possible. Sending bills or invoices via snail mail is not only time-consuming or tedious, it also increases the likelihood of delayed or missed payments. Paper documents can get lost in the mail, and even when they’re received, it’s all too easy for customers to misplace or forget about them.

Do yourself and your customers a favor by digitizing your billing and invoicing practices. Instead of using traditional mail, utilize digital platforms such as email and SMS to notify customers about payments that are due.

Automate Your Procedures

Billing and invoicing involves a number of steps. The merchant sends the bill/invoice, which is then reviewed and paid by the customer. From there, the merchant must then issue a receipt once the payment is complete.

Done manually, the above process takes time and involves a lot of back-and-forth with the customer. The good news? Using a modern payment platform such as Stax can automate these steps to make life easier for both the merchant and the customer.

Stax has invoicing capabilities for automating tasks like:

  • Notifying customers when payment is due
  • Sending reminders
  • Issuing receipts

Plus, Stax makes it easy to generate invoices. Our customization features allow you to drag-and-drop multiple fields, select tax rates, and add a memo. You can also track which invoices are outstanding and which of your customers owe a payment.

When these steps are placed on autopilot, you can spend less time chasing payments and devote more energy to other areas of your business.

Set Up a Portal for Payments

Another way to streamline billing and invoicing is to offer a self-service payment process. Rather than clients having to call you or send a check via snail mail, establish an online portal where they can enter their payment details.

Stax makes this extremely easy. Enable online payments by sending payment links or embedding a “Pay Now” button on your website, so customers can pay their bills without having to manually coordinate with you.

Keep Your Customer’s Payment Details on File

This tip works best if you need to invoice or bill clients on a recurring basis. If payments need to be made at regular intervals, invite your customers to provide you with an account number or credit card that you can keep on file.

Doing so can eliminate manual work completely — both for businesses and customers. As the merchant, you won’t have to generate the same invoices every month; meanwhile, your customers can rest easy knowing that their bills are automatically paid.

Integrate Your Solutions

You’ll make your life immensely easier by integrating your payments platform with other components of the business — including customer management, inventory, analytics, and more.

When your systems are tightly connected, information can flow smoothly across various applications, eliminating the need for manual data entry and updates. It also makes tracking payments and other metrics so much easier.

If you’re tired of tracking and managing payment across multiple platforms, the Stax all-in-one Platform is a perfect solution. You can view a detailed list of customer information, recurring payment schedules, catalog items, and inventory with just one login. You can drill down into specifics to manage customer information, like their preferred payment method.

A virtual terminal automatically tracks inventory levels, working from invoices every time something is sold. Everything is one place, and you can search by keyword and sort by name, address, and more to find exactly what you’re looking for.

Integrating your payment technology will organize your invoices, customer information, and data. You’ll get paid faster with automated receipts and due-date reminders for customers. And if you need to check a customer’s information or inventory levels, it’s all there. Stax streamlines your entire payments and billing process while also saving you money.

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Quick FAQs about Invoicing and Billing

Q: What is the difference between invoicing and billing?

Invoicing refers to the process of sending an invoice — a document itemizing the products or services sold by the business. An invoice typically contains the date it was sent, the date the products/services were delivered, the payment terms, and payment instructions. A bill, on the other hand, is a document received by the customer outlining the products or services rendered by the business. A key difference is that a bill usually implies the need for immediate payment, while an invoice can outline certain terms (i.e., net 30/60/90 days).

Q: Why should businesses digitize their billing and invoicing documents?

The digitization of billing and invoicing documents is essential to streamline operations. Sending bills or invoices via traditional mail is time-consuming and increases the likelihood of delayed or missed payments. Digital platforms such as email and SMS enable businesses to notify customers about due payments more efficiently.

Q: What are the benefits of automating billing and invoicing procedures?

Automating billing and invoicing procedures helps to save time and reduce the amount of manual work involved in the process. It can automate tasks like notifying customers when payment is due, sending reminders, and issuing receipts. This enables businesses to spend less time chasing payments and more time focusing on other areas of their business.

Q: What is a portal for payments and why is it beneficial?

A portal for payments is an online platform where customers can enter their payment details to pay their bills. It offers a self-service payment process, eliminating the need for manual coordination between the business and the customer. 

Q: Why should businesses keep their customer’s payment details on file?

Keeping a customer’s payment details on file is beneficial for businesses that need to invoice or bill clients on a recurring basis. It can eliminate manual work completely as the business won’t have to generate the same invoices every month, and the customers can rest easy knowing that their bills are automatically paid.

Q: How can integrating payment technology with other business components be beneficial?

Integration of payment technology with other business components like customer management, inventory, and analytics can help streamline operations. Information can flow smoothly across various applications, eliminating the need for manual data entry and updates, and making it easier to track payments and other metrics.

Q: What is the role of a modern payment platform like Stax in simplifying the billing and invoicing process?

A modern payment platform like Stax can greatly simplify the billing and invoicing process by automating various tasks such as notifying customers when payment is due, sending reminders, issuing receipts, and generating invoices. It also allows businesses to track outstanding invoices and payments, establish an online portal for payments, and integrate with other business components.


 

How to Pick the Best Payment Solutions for Your Business

Choosing the best payment solutions from credit card processors may seem like an overwhelming task with so many options to choose from. However, it doesn’t need to be. Familiarizing yourself with the basics of different payment channels and their benefits is a great place to start. Here’s what you need to know to find the best payment solutions for your company’s credit card processing needs.

What is a Payment Channel?

A payment channel is any way that a customer can make a payment, or anywhere that the merchant might accept a payment. Payment channels are specifically associated with how the payment is made and include the following:

Payment Channels & Best Payment Processing Solutions For Your Business

Having multiple payment channels may not be necessary early on, but in order to pick the best payment solutions as your business grows it will be important to expand your channels. Depending on your business you may need to start with a physical POS (point of sale) system, while someone in the digital space may need to focus on mobile payments.
This guide will help you find the best payment solutions and channel that will best fit your business.

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In-Person Payment Processing

In-Person payments can utilize a physical or virtual POS system to take customers’ payments inside your business. Some Physical POS systems can serve a dual purpose as a terminal, giving customers the ability to swipe directly through a single piece of hardware. Others allow you greater flexibility, enabling you to easily connect terminals via a Bluetooth device. The right terminal expands payment options for customers, allowing them to dip, tap, or use Apple Pay and Google Pay to make payments.

Physical POS Terminal

The physical POS is a traditional payment channel, supported on a cash register, where customers pay right inside your store.

Stax offers two forms of POS retail solutions for business owners. The first are standard EMV smart terminals, a simple countertop terminal solution, the second is a Mobile Checkout POS system.

Mobile Checkout POS systems are an all-in-one point of sale system right at your fingertips. When collecting customer payments, you are even able to use a tablet, or phone device to securely process sales from any location.

Virtual Terminals

A virtual terminal gives you the power to process and manage over the phone and face-to-face transactions in real-time. Because there’s no need for a physical or traditional credit card terminal, a virtual terminal uses software to process transactions. This solution is generally for merchants who don’t have a brick-and-mortar business and often take customer information over the phone or online.

The Stax platform offers companies the ability to process and manage telephone and face-to-face transactions giving you the best payment solutions. It is great for service-based companies, B2B companies, or anyone who does recurring billing. As long as you have an Internet connection, you can process payments directly through Stax. All transactions are securely tokenized and are compliant for your best payment solutions.

Businesses can also continue using their existing POS systems as the Stax platform seamlessly integrates with most terminals.

eCommerce Payment Processing

For businesses looking to process payments through their website or create an online shopping store, eCommerce payments solution allows you to expand purchasing capabilities online. Businesses can collect and manage payment transactions online without the need for a physical or traditional credit card terminal.

Stax’ digital payment solutions and eCommerce tools like an online shopping cart or webhooks allow businesses to engage digitally with even more customers. Stax also supports the ability for businesses to build their own or integrate with a provider like Authorize.net for an eCommerce shopping cart.

Mobile Payment Processing

Mobile payments are vital for businesses that are on the go or those that want to keep hardware to a minimum. Many businesses find using mobile payments works better and faster for them in comparison to physical POS systems. This can be a great solution for service professionals that operate in the field and need to accept payments on location.

Stax offers mobile readers for businesses looking to accept payments in any environment. Additionally, being able to turn your phone or tablet into a mobile POS system is also a benefit that can be easily overlooked by many businesses. With the Stax iOS and Android app, businesses can turn any mobile device into a handheld POS and take payments, send invoices, and view reports from anywhere. You can also monitor and manage business in real-time, with the ability to quickly view daily, weekly, and monthly sales reports.

Contactless Payments

Contactless payment devices allow businesses to accept in-person payments without the need for physical contact. From Text2Pay to touch-free terminals, you can quickly and safely process payments on the go.

Contactless by Stax gives you immediate access to tools that can pair perfectly with your online shopping cart. Offering Text2Pay gives customers the ability to pay for their purchase in just a few taps from wherever they are. Businesses can personalize their customer’s experience by answering questions and making updates to an order via text.

All of these payment channels and more are available for businesses to easily collect payments from customers and maximize their revenue.

To find the best payment solutions for your business compare Stax integrated payment platform and use whichever payment channels serve best regardless of where you plan on taking payments.

To learn more about how the Stax all-in-one platform can help your business, fill out the form below to request a savings estimate today.

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The Ultimate Guide to Accepting Credit Card Payments

Credit cards are a staple in the wallets of consumers today, and they will continue to be a payment method of choice for years to come, particularly as the adoption of mobile and contactless payments continue to grow.

In fact, ResearchAndMarkets.com forecasts the global credit card payment market to grow from $477.63 billion in 2021 to $762.16 billion by 2027—exhibiting a 7.8% compound annual growth rate over the next five years.

To give you some clarity, here’s a practical guide that answers the most common questions small business owners have about credit card processing.

Answering Your Questions About How To Accept Credit Card Payments

According to studies, the number of open credit card accounts in the United States stands at an all-time high of 537 million. With 83% of Americans owning at least one card (while the average American owns three), it’s safe to say that credit card purchase volumes have increased significantly over the last decade.

That means if your business shies away from accepting credit cards as a mode of payment, it can have detrimental effects on your business growth.

With Americans being 40% likely to pay for their purchases using a credit card, it’s easy to see why more and more small business owners are now turning to merchant services providers to start offering credit cards as a payment option.

In addition, as credit card transactions continue to grow due to digitization and other factors, many businesses are adding the ability to process payments made via debit cards, credit cards, and mobile wallets (like Google Pay, Apple Pay, PayPal, or Venmo) in order to be more accommodating to their customers.

Navigating the realm of credit card payment processing can be tricky because there are several entities and moving parts involved in facilitating transactions.

So let’s more about the basics of credit card processing including how it works, the entities involved, the fees you may have to incur, and how you can start accepting credit card payments easily.

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What is Credit Card Payment Processing?

Credit card processing refers to the series of steps involved to facilitate transactions made using credit cards. The process begins from the moment the customer makes a card payment to the point when the transaction is authorized and settled. This can be done through a variety of channels, which include but are not limited to:

Before you learn more about the more detailed aspects of credit card payments, such as the difference between traditional and integrated payment platforms, it is important to learn the basics.

This fundamental knowledge will help you learn more about the process to accept credit cards. It will also contribute to further realizations on how it works for your small business.

You can understand the relationship between credit card processing fees, the nuances of debit card and credit card transactions, and how it ties back to your business bank account.

These essentials will also enable you to work with payment service providers and credit card processors more seamlessly.

Ready to learn more? Let’s start with the mechanics of accepting credit card payments.

How Do Businesses Accept Credit Cards?

Some businesses choose a traditional payment solution to accept credit card payments, while others go with an integrated payment platform.

For example, businesses such as coffee shops may choose to use a point-of-sale system (POS system) or hardwired credit card reader to accept card payments at the counter. Or they could use a mobile credit card terminal if they prefer to collect payments at the table.

Mobile card readers are particularly suited for merchants that sell their products at farmers’ markets, fairs, trade shows, etc., as well as mobile businesses like dog groomers, food trucks, plumbers, etc.

Other businesses may consider a more feature-rich platform to account for the integration of a variety of online and in-store payments into a single payment platform.

Different types of businesses require various solutions ranging from mobile device options to the ability to accept credit card payments online.

But the common factor remains their pursuit to accept credit card payments, which lets them serve more customers and increase their revenues.

Credit Card Payments Are Not Limited to One Channel

Accept Credit Card Payments_Field Services Mobile Credit Card Reader_Body Image

POS terminals are present in brick-and-mortar stores. Further, more business owners are shifting to POS payment methods that are consistent with other payment solutions to keep their overall payments process simple.

Mobile solutions are becoming increasingly popular with popups, service professionals, and doorstep delivery services. They can use the typical method of swiping or dipping the card or also go the route of modern tap-to-pay or contactless payments. Essentially, swiping, dipping, and tapping are the three ways that customers can make in-person payments with a credit or debit card.

Swiping, of course, is the oldest of the three methods and is used with a card that has a magnetic stripe (or magstripe) on it. Both dipping and tapping require an EMV chip card that generates a unique one-time code for every transaction.

This adds an extra layer of security to these transactions. In tap-to-pay transactions, EMV combines with another technology called NFC (near-field communications) that makes it possible for the card terminal to read credit card information from contactless cards.

Mobile apps can also be used by service professionals to accept credit card payments directly into their app accounts. They are also used by businesses that accept credit card payments via modern methods such as QR codes, which are unique to each merchant account.

As the name suggests, online payment gateways are used by eCommerce stores and apps. These solutions require customers to process their credit card payments by manually entering their 16-digit number, expiration date, and CVV code.

Entities Involved in Credit Card Processing

Here are the key parties involved in processing any credit card transaction.

1. The Merchant

This is you or your business. You are also given a merchant account where your processed payments go for your usage. In essence, this is the business that accepts card payments from customers in exchange for their products or services.

2. The Customer

Put simply, the cardholder who uses their debit or credit card to pay for the products or services.

3. Acquiring Bank

The merchant bank that allows the business to receive money from card transactions and store these funds. Sometimes acquiring banks may also serve as the payment solutions provider that supply you with the required equipment/card readers and infrastructure to process credit card payments and deposit funds into your merchant account.

4. The Issuing Bank

The cardholder’s bank or financial institution that issued their credit or debit card.

5. Credit Card Associations

This is the card network or card brand that powers the credit card for the cardholder. Examples such as Visa and MasterCard will help you remember what credit card networks do.

6. Payment Processor

The credit card processing company that connects the merchant, card associations, and issuing banks to facilitate payments.

The Role of Credit Card Associations in Payment Processing

All major credit cards are connected to card associations in some way. Each association has its own interchange fee, so knowing what these fees are and how they are handled by your merchant service provider will help ease any potential confusion.

This component is a core part of your overall transaction fees and you will see this as a part of your processing fees.

Some providers will even allow you to “turn off” acceptance for American Express or Discover, allowing you to simply accept Visa and Mastercard as their interchange rates are typically lower.

This is beneficial if you discover over time that your customers are not really using either of those associations for payment and you want to save on those fees.

Keep in mind that while these are the most widely used payment card networks, they are not the only networks that you can encounter or use as a small business to accept credit card payments on behalf of your customers.

You Need an Acquiring Bank or Merchant Service Provider

Apart from credit card associations, the other key party involved in processing these payments is your merchant services provider or your acquiring bank.

The acquiring bank is a financial institution that accepts the payment and deposits into the business account. Further, they can play the role of the payments processor, making them a critical part of the transaction.

In essence, these solution providers or acquirers are the entity that helps you accept credit card payments via different equipment and software solutions.

How Are Credit Card Payments Processed?

When a card is present, you can swipe the card against a POS terminal. You can also scan it via a card reader. For scenarios where the card isn’t present, you can use its details to perform contactless credit card payments via online or digital payment gateways.

Through your acquiring bank or your payment solutions provider, you can use these methods to send the payment information to the credit card network.

The credit card network receives the information, verifies it, and then sends you its approval. When the transaction goes through, you can know right away and deliver your customers the products or services they have purchased.

It’s as simple as that.

But that’s just a surface-level description of credit card payment processing. The major part of the process comes after these services have been delivered.

Traditional vs. Integrated Payment Systems

Accept Credit Card Payments_Stax Pay Integrated Payment Processing System_Body Image

If you use a traditional POS method of credit card processing, then it goes like this:

  • Create a new sale in POS and scan the item.
  • Choose the payment method your customer would like to use (debit, credit, gift card, etc.).
  • Grab your terminal or card reader and manually input the sale amount into the terminal.
  • Start the process of authorizing and accept credit card payments from the merchant services provider/acquiring bank
  • In case the transaction is approved, retrieve the terminal and print receipts.
  • Go back to the POS, manually mark the purchase as paid and complete the checkout process.

In an integrated payment, the transaction amount is automatically pushed to the terminal instead of being manually entered. It is also automatically reconciled and marked as paid once payment has been processed.

As such, integrated payment solutions combine payment processing systems with feature-rich technology that helps automate the payments process. By using integrated payment services, you cut through the redundant work required by traditional payment systems.

That’s why most business owners now prefer using integrated payment solutions as opposed to traditional payment systems.

Apart from making credit card payment processing easier, integrated payment solutions also bring other benefits to the table.

If you use multi-channel payments, then integrated payment solutions also help you manage your transactions from different avenues. For instance, if you have multiple stores or if you sell your services at a storefront as well as online, then you can see all your transactions in one place.

What Are the Costs of Credit Card Processing?

Before you sign up with a merchant solutions provider, it is essential to remember that the charges for credit card payments are not set in stone.

While some merchant account providers charge you a separate fee to pay for credit card networks, others do not require you to do so. Some merchant service providers may ask you for a higher setup fee for your credit card readers while others may offer their equipment at a lower price.

All in all, the charges for processing credit card payments depend upon the merchant services provider. It is best to shop around and compare fees as well as services before you sign up with a provider.

This way, you can make sure that you are getting the best deal for your business.

It also helps to understand the pricing structure of different payment processors. These pricing structures include:

Tiered pricing. With this pricing method, the payment processor places transactions into three tiers: qualified, mid-qualified, and non-qualified.

How a transaction is categorized is based on factors like what card was used or where the transaction took place. Premium credit cards such as travel and reward cards are usually placed into the non-qualified tier, which incurs higher payment processing fees.

Meanwhile, transactions that involve debit cards and basic credit cards are usually placed in the qualified tier and get lower rates.

While it’s simple enough to understand, the tiered pricing structure lacks transparency. This is because the rules for how to categorize transactions are completely arbitrary and up to the processor.

As a result, this structure makes tiered models the least transparent. It’s difficult to figure out how much you’re actually paying, given that the processor doesn’t disclose their methods for how transactions are qualified.

Interchange-plus pricing. With this pricing structure, the payment processor separates the interchange fees for processing payment. Your payment processor adds a markup to the cost of interchange (and assessment) which is clearly indicated in your statements.

Interchange-plus pricing is a much more transparent pricing structure, as it enables you to see how much of your fees are paid to credit card networks/banks and how much goes to your processor.

Flat rate pricing. Sometimes referred to as blended pricing, companies that implement a flat rate structure charge you one easy-to-understand rate for credit card processing.

This pricing method blends that interchange rate and the processor’s markup into one competitive fee. Your processor will charge you a flat percentage for every card transaction—regardless of its type. Think Square.

While it’s easy to understand, you may end up paying a lot more for transactions that typically cost less to process.

Membership pricing. Payment processors that implement membership pricing give you access to direct interchange rates—regardless of your processing volume. And instead of adding a percent markup to each transaction, you’re simply charged a flat membership fee every month.

This turns out to be more cost-effective in the long run as your business scales and you process more (including being able to directly benefit from Level 2 and Level 3 interchange rates).

Stax is one example of a provider that implements membership pricing. Unlike traditional pricing structures, Stax’s fees are fully transparent AND we don’t take a cut out of your sales.

A note on payment processing fees

When determining the right merchant services provider, be sure to look beyond their payment processing fees. Some companies charge additional costs on top of processing expenses, so be sure to ask about any extra fees you may encounter.

Here are some of the most popular fees or costs that you will see during the process.

It is also prudent to remember that while not all merchant account providers charge you the same amount, most of them charge you for each transaction they process. Some of these fees are industry standard, but the actual fee varies on a case-to-case basis.

How to Start Accepting Credit Card Payments

Thankfully, advancements in the payments sector now allow business owners to obtain the required services for processing credit card payments easily. Business owners can simply choose between a traditional or integrated payment platform.

It is also straightforward to obtain online payment solutions or mobile payment solutions for your operations. You just need to find a provider that offers these services under one umbrella while also being known for their reliability.

At Stax, we offer an array of credit card payment processing services to help you take your business to the next level. Through Stax’ integrated payment solutions, we can help you manage your payments in a highly efficient way. We understand the needs of our merchants as we have been in the industry for a while and have served many partners over the years.

Stax offers a superior customer experience due to our excellent customer success, flexibility, and advanced processes and systems. Our seamless, reliable, and subscription-style solutions also keep affordability in mind and help business owners save more money as they scale.

Reach out to Stax for a consultation today.

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Quick FAQs about Accepting Credit Card Payments

Q: What is credit card payment processing?

Credit card payment processing refers to the series of steps involved in facilitating transactions made using credit cards. It begins from the moment the customer makes a card payment to the point when the transaction is authorized and settled. This can be done through various channels.

Q: How do businesses accept credit card payments?

Businesses can accept credit card payments either through a traditional payment solution or an integrated payment platform. They could use a Point-of-sale (POS) system, hardwired credit card reader, or a mobile credit card terminal depending on their preference and business model.

Q: What are the key parties involved in processing a credit card transaction?

The key parties involved in processing a credit card transaction are the merchant, customer, acquiring bank, issuing bank, credit card associations, and payment processor.

Q: What are the costs of credit card processing?

Costs of credit card processing are not standardized and depend upon the merchant services provider. They could include setup fees, admin fees, PCI compliance fees, and interchange fees. The pricing structures could be tiered pricing, interchange-plus pricing, flat rate pricing, or membership pricing.

Q: How can a business start accepting credit card payments?

A business can start accepting credit card payments by choosing between a traditional or integrated payment platform. It is also straightforward to obtain online payment solutions or mobile payment solutions from a reliable provider that offers these services.

Q: What is the role of credit card associations in payment processing?

Credit card associations, such as Visa and MasterCard, power the credit cards for the cardholder. Each association has its own interchange fee, which forms a core part of your overall transaction fees and is included in your processing fees.

Q: What is an acquiring bank or merchant service provider?

An acquiring bank or merchant service provider is a financial institution that accepts the payment and deposits it into the business account. They also play the role of the payment processor, making them a critical part of the transaction.

Q: What is the difference between traditional and integrated payment systems?

In a traditional POS method of credit card processing, the transaction amount needs to be manually inputted into the terminal. In an integrated payment system, the transaction amount is automatically pushed to the terminal. Integrated payment solutions also bring other benefits such as managing transactions from different avenues and automating the payments process.

Q: What is the impact of credit card payments on business growth?

If a business refrains from accepting credit cards as a mode of payment, it can have detrimental effects on the business’s growth. With 83% of Americans owning at least one card, credit card purchase volumes have significantly increased over the last decade, making credit card payments a crucial part of any business.

Q: What are some popular solutions for accepting credit card payments?

Some popular solutions for accepting credit card payments include services provided by Square, Stripe, QuickBooks, and Authorize.net. These platforms offer a variety of services to accept credit card payments online, in person, or via mobile devices.

SEO Keywords: Credit card payment processing, accepting credit card payments, key parties in processing credit card transaction, costs of credit card processing, start accepting credit card payments, role of credit card associations, acquiring bank, merchant service provider, traditional and integrated payment systems, impact of credit card payments, popular solutions for accepting credit card payments.


 

How Stax Connect Provided Value To Hindsite Customers

We sat with Hindsite’s CEO, David Crary, to uncover how partnering with Stax Connect, has positively impacted their business and delivered significant value to their customers. 

The Vision: Adding Integrated Payments to the Hindsite Platform

A year ago, Hindsite was at a crossroads. They had done an incredible job helping their 800+ users simplify operations through their field services software, but had yet to address adding integrated payments to their platform. While their technology helped solve important pain points for their customers, they knew that the next step was figuring out how to create a comprehensive solution inclusive of payments. 

They saw integrated payments as their way of increasing brand value and adding an additional revenue stream for the company. The ultimate goal was to add value to their current customers while establishing Hindsite as the central hub from which all field service contractors operate their business. With that in mind, it was increasingly important for them to find a partner who understood customer service, had technical expertise in the space, and held user experience at the core of their business.

The process of searching for the “right” partner proved to be strenuous, however, their uncompromising value of “customers first” ultimately led them to Stax Connect. 

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The Challenge: Communication and Visibility 

Hindsite realized that the road ahead would prove to be challenging if they did not find a partner who was committed to “go[ing] through the trenches with them.”  “Stax Connect has been great to partner with because there are a lot of back-end pieces that have to work in order for the integration to take place,” said David Crary. 

While choosing a payments partner, it was exceedingly important for Hindsite to find a company that would offer them the level of support that was required by their development team, because payment technology wasn’t their area of expertise. “The communication and visibility that the Stax Connect team continues to provide is outstanding and is a very big part of the reason why we chose them in the first place.”

RELATED: Deep Dive Into ISV Partnership 

The Solution: Stax Connect’s Step-By-Step Payments Integration and Implementation Support

In their evaluation of other integrated payments providers, Hindsite very quickly realized that the support offered from a technical perspective was very limited. Where other companies simply offered to provide them with API documentation and little to no technical support, Stax Connect stood above the rest. From the beginning, they “offered us support every step of the way and had a dedicated team to help us through the integration process and beyond.” In fact, “they helped us see why we hit a wall [in development] and even showed us how to get past it.” 

It was extremely important for Hindsite to find a partner that fit their DNA and was customer-centric above all else. “Although Stax Connect had superior technology, the relationship and alignment on core values were the primary reasons we [Hindsite] chose to go with Stax.” Stax Connect and Hindsite ultimately had the same core values and cared deeply about putting the customer first, giving them the support that was needed, and delivering the best possible service. 

How Adding Integrated Payments Technology Added Value To Hindsite Customers

“The problem we set out to solve when including integrated payments in our value offering has for the most part been addressed.” In fact, since the integration, Hindsite has witnessed improved user experience and has been able to save its users significant time, as they no longer have to operate from a separate platform for payments. Where before Hindsite customers had to spend countless hours reconciling their revenue, and working from two systems, this is no longer the case. Hindsite has also been able to help its customers tackle their accounts receivable problem through its new feature, ProntoPay, powered by Stax, which gives users the ability to store payment information and pre-authorize payments.  

In fact, according to Hindsite user Michael Rose, owner at Suburban Lawn Sprinkler, 

“The ability to accept payments through my Hindsite platform has been an absolute game-changer. Hindsite and Stax are constantly adding features and functionality to improve my experience. As a business in the service industry, we struggle with having a high accounts receivable balance, and thanks to Hindsite’s new feature ProntoPay – that’s no longer something I have to be worried about. For all those, struggling with high accounts receivable balances, I cannot recommend ProntoPay enough!”

 

Recap 

  • Accelerated integration of an all-in-one payment solution using the Stax Payment API and mobile SDKs, with full support and assistance from Stax payment experts at every stage
  • Easily consolidated credit card and mobile payments into their platform, with quick user enrollment capabilities through Stax Connect’s pre-built enrollment platform
  • Leveraged Stax Connect’s Command Center to deepen insights and understand enrollment, activity, and payment volume as their platform scales
  • Instant access to direct interchange rates through Stax allowed them to personalize their integrated payment pricing and create an additional revenue stream
  • Able to offer award-winning support services to their users with a partner who is also dedicated to creating and delivering top-level customer experience

Facilitating the Road Ahead

The Hindsite team plans on continuing to optimize the customer experience and adding more features to support their users from a payments standpoint, with the help of Stax’ technology suite. Hindsite’s ultimate goal is to continue to position its platform as the central hub for field service contractors. 

They recognize that payments are an integral part of a business’s DNA and they hope to further enhance their software (specifically their payments functionalities) to continue solving their customer’s pain points. “Getting paid is the biggest thing we can help our customers do and by partnering with Stax Connect we are on the path to creating a powerful solution for service contractors.” 

About Stax Connect 

Stax Connect is an award-winning payment technology leader in FinTech focused on empowering established businesses and software companies to streamline payment acceptance, simplify operations and grow their business. With its all-in-one integrated solution Stax Connect, traditional software companies have access to an entire payments ecosystem at their fingertips. This comprehensive solution equips software companies with the ability to accept payments from within their platforms to help create an overall integrated experience for their users. Stax Connect brings together all of the necessary payment processing tools and services into a single platform, thereby allowing a software company to own and monetize the entire payments experience.

RELATED: Stax Connect vs. Stripe Connect

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FAQs about Hindsite partner

Q: What led Hindsite to partner with Stax Connect?

Hindsite sought to add integrated payments to its platform as a means to increase its brand value and add an additional revenue stream. Stax Connect was chosen due to its understanding of customer service, technical expertise in the space, and commitment to superior user experience.

Q: What were the challenges Hindsite faced in adding integrated payments to their platform?

Hindsite’s main challenge was that they lacked expertise in payment technology. They faced difficulties in finding a company that could provide the necessary support to their development team for the payment integration.

Q: How did Stax Connect help Hindsite overcome these challenges?

Stax Connect offered Hindsite unprecedented technical support. They assisted Hindsite’s team at every step of the integration process, helping them understand and overcome development hurdles.

Q: What value did the integration of Stax Connect’s payments technology add to Hindsite customers?

The integration simplified operations for Hindsite users by allowing them to operate from a single platform, saving them significant time. They also introduced a new feature, ProntoPay, which eased the process of reconciling revenue and managing accounts receivable.

Q: How did Stax Connect and Hindsite align on core values?

Both companies put customer service at the forefront of their operations. They shared the same objective of delivering superior service and ensuring extensive customer support.

Q: What is Hindsite’s plan for the future with Stax Connect?

Hindsite intends to further optimize customer experience and add more features to support their users on the payments front with the help of Stax’s technology suite.

Q: What is Stax Connect’s role in B2B operations?

Stax Connect is an award-winning payment technology leader in FinTech that helps businesses and software companies simplify operations and grow their business. They provide an all-in-one integrated solution for streamlining payment acceptance.

Q: What is the primary benefit of an integrated payment solution for businesses?

Integrated payment solutions, such as Stax Connect, facilitate consolidated credit card and mobile payments into a single platform. They offer quick user enrollment capabilities, deep insights into enrollment, and activity and payment volume as the platform scales.

Q: What is ProntoPay, and how does it help Hindsite users?

ProntoPay is a feature enabled by Stax Connect that allows Hindsite users to store payment information and pre-authorize payments. This feature greatly assists businesses, especially those in the service industry, struggling with high accounts receivable balances.

Q: How has the partnership between Stax Connect and Hindsite impacted Hindsite customers’ experience?

The partnership has extensively improved the user experience for Hindsite customers. The integrated payments solution by Stax Connect has led to time-saving, improved revenue reconciliation, and efficient handling of accounts receivable balances.