Payment processing

Is It Necessary to Implement a Payment Processing Solution?

You have been running your business for a while. Maybe you’re an online startup or a little mom-and-pop shop that has been operating locally for years. You’ve been getting along without a payment processing solution, and you’re probably wondering if it is even necessary to implement one.

The answer to that question is almost certainly a yes.

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How Does It Work?

A payment processing solution allows you to accept more kinds of transactions than simply cash or an online cash transfer service (more on that in a moment). With a processing solution, you receive equipment, such as a terminal or an e-commerce system, that allows you to process transactions.

When a customer makes a purchase or places an order, you send the information to your provider, who then issues a request to the customer’s bank or credit card company. The issuer then approves or denies the request.

When the transaction is approved, the issuing bank or credit card company moves funds to your provider’s account. Your provider then credits your merchant account. If you want to accept credit card payments or even payments online, you need a processing solution.

You’re Already Using One

Chances are, if you offer online shopping, you’re already using some kind of processing solution such as PayPal or a similar service. The question isn’t whether you need to implement a payment processing solution—it’s whether or not you’re using the one that’s best for your customers.

If you operate a cash-only business in a bricks-and-mortar store, however, you still need to consider a payment processing solution. Yes, you may have got along for many years by accepting cash only. But you’ve likely noticed that you have had to turn away more and more business in recent years—a customer comes in and gets ready to pay, only to find out you don’t accept credit or debit.

Flustered, with no ATM in sight, the customer leaves their merchandise and takes their business elsewhere. This can happen even if you do offer card processing—you may not accept the customer’s preferred card, and they do not have an alternate card with them!

Easy and Convenient

Maybe you started out cash only because cash was the easiest way for people to pay. Maybe you signed up with PayPal or a similar service ages ago, because it was the only reputable option for online merchants or because you thought it was the way most of your customers wanted to pay.

Customers want more choice. They want to be able to shop any way they want—and they want to be able to pay any way they want. That means your payment processing solution needs to offer customers more choice: Do they want to pay with credit or debit? What happens if your customer doesn’t have a Paypal account—and doesn’t want to make one? Offering a payment processing solution can offer your customers more choice, which makes shopping with you easier and more convenient.

It Does Not Have to Be Expensive

One of the reasons you may have resisted signing up for payment processing is that you believe it’s expensive. Maybe you think that paying credit card processing fees will harm your business by eating into your profit margin. Losing sales, however, is also a good way to hurt your business. That means that accepting more payment methods is probably in your best interests.

More than that, however, payment processing doesn’t need to be expensive. Yes, you will pay more than if you do not have a solution in place. But that does not mean that you will pay so much that your business cannot turn profit. Find a provider that’s willing to work with your business to find the right solution for you.


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Lisa Gibson

Lisa is the Credit Manager of BNA Smart Payment Systems and has over 18 years of experience in diverse roles of credit and credit risk management. She graduated from the financial program at Boreal College and is an expert in personal loans and line of credit, mortgage underwriting, private label commercial credit cards, small business loans, and merchant account underwriting. Lisa is also an avid railfan and HO scale train modeler, and enjoys curling.

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